how to get an FR-S - have 3 cars, 2 need to go

[extrashaky]

Originally Posted by totopo

PSS it always feels like to me, the people who espouse the financial model to individuals are young people who have just graduated out of college and haven't yet lived through their first economic crash. Older people I feel like who have seen their jobs and savings come and go with the economy I feel like view things as stuff they have, and money they owe.

Originally Posted by Koa

There's a lot of debate about the first couple, but one thing I can't stand is a passive aggressive poster (refer: your last assumption about, in essence, me and people you think are like me)

I'm also a financial professional. I'm a 40-something CPA with a degree in finance and Big 4 accounting experience. I have a background as a SOX auditor for a real estate management company and now work as a senior auditor for an insurance company. I'm also in my second career, having spent ten years working in television prior to returning to school. I am old enough to have experienced lean times and the surprises of life.

I agree with Koa 100%.

This whole debt-is-bad nonsense is borne out of ignorance. Debt is neither good nor bad. It's simply a tool. When used responsibly, it can improve both financial position and quality of life.

When abused, of course it can do a lot of damage. It's like a knife. There are all sorts of knives used for all sorts of constructive purposes. Used recklessly, they can hurt or kill you. Yet most people do not discard all their knives over a fear of getting cut. Can you imagine an entire Dave Ramsey radio show where he constantly repeats that you should throw out your kitchen knives and only use spoons from now on? That mindset is the equivalent of restricting yourself to financial porridge for the rest of your life.

"No, surgeon, don't cut that patient! Knives are bad!"

Originally Posted by totopo

Another problem with cash flow is usually banks and corporations spend cash on stuff to help them make more money, which usually is worth something in and of itself and can be sold for at least something at a future date. Individuals rarely spend cash to buy stuff to help them make more money. You spend extra money, not invest it, which is a huge difference. Cars being a great example. When you go on vacation, you can't sell your memories at a later date if you end up needing some more cash. That money is gone.

That paragraph is really strange to me. I actually do approach my personal finances similar to the way I would manage a company. I think most people do to some extent.

I often spend money on things that will make money for me (or reduce expenses). For example, I view my BRZ as a CAPEX investment that has a pretty good return. Since I drive a lot for work, I needed reliable transportation with low operating cost. Without it, my employment prospects would be so limited that I would not be able to make anywhere near my current salary. So the car "pays for itself" already. This is really no different from a high school graduate buying a hooptie to be able to get to his first job as a janitor. Without some sort of transportation, most people in the US aren't working. That makes transportation an investment.

Because I actually drive my BRZ for work, I am reimbursed mileage, and the mileage reimbursement is higher than the operating cost of the car. I am, in fact, making money tax free on the expenditure. I financed the car at 1.49%. Even with the roughly $800 interest expense I'll pay over the four years of the loan, the car is still making me money. An actual cash return.

If my life is a business, my ultimate return is personal satisfaction. Money is just a way to store happiness for future use. So I make financial decisions that not only lead to more money, but also contribute to my quality of life. I could have bought something even cheaper than the BRZ, but there was value in driving something that gives me pleasure while making me money. I could have bought something more expensive, but the marginal increase in personal satisfaction wasn't worth the extra expense. A brand new Corvette might have made me happier, but certainly not $40K happier.

I could have put more money down on the BRZ and reduced my monthly expenses, but then I wouldn't have been able to sink that cash into my Jeep XJ project, which also gives me pleasure. And the Jeep also has utility, because it can go places and carry things the BRZ can't. That utility turns into monetary value when I can use it to haul other things that make me money or contribute to my quality of life without having to rent a van.

This approach goes far beyond my choice of vehicles. When I was in television, I bought a lot of my own equipment to supplement my station-provided gear to improve the quality of my work. I got into arguments with colleagues who said I shouldn't be spending my own money on tools my employer wouldn't pay for. Yet those expenditures helped me get to the international level and triple my income in six years. Then I took that money and reinvested it back into myself to pay for my finance degree, which significantly boosted my earnings prospects again. I'm currently positioning myself to purchase property, which will reduce some of my living expenses. And I'm saving for another potential round of college that will make me even more marketable.

But I'm certain I'm not unique. Those are the kinds of decisions most people make in their lives to some degree. If you study successful people, you'll find that in general people who prosper and build a good quality of life for themselves follow a similar approach, often by instinct and not even realizing they're managing their lives the way an entrepreneur would manage a company. On the flip side, anybody can experience catastrophe in their lives, but generally speaking the ones who have recurring financial difficulties more often than not never learned to plan for the long term. Just because they never learned it doesn't mean the rest of us can't or shouldn't make use of all the financial tools at our disposal.

[Koa]

Originally Posted by extrashaky

I'm also a financial professional. I'm a 40-something CPA with a degree in finance and Big 4 accounting experience. I have a background as a SOX auditor for a real estate management company and now work as a senior auditor for an insurance company. I'm also in my second career, having spent ten years working in television prior to returning to school. I am old enough to have experienced lean times and the surprises of life.

If my life is a business, my ultimate return is personal satisfaction. Money is just a way to store happiness for future use. So I make financial decisions that not only lead to more money, but also contribute to my quality of life. I could have bought something even cheaper than the BRZ, but there was value in driving something that gives me pleasure while making me money. I could have bought something more expensive, but the marginal increase in personal satisfaction wasn't worth the extra expense. A brand new Corvette might have made me happier, but certainly not $40K happier.

I could have put more money down on the BRZ and reduced my monthly expenses, but then I wouldn't have been able to sink that cash into my Jeep XJ project, which also gives me pleasure. And the Jeep also has utility, because it can go places and carry things the BRZ can't. That utility turns into monetary value when I can use it to haul other things that make me money or contribute to my quality of life without having to rent a van.

nailed what I was failing to underscore.. doesn't matter if it's an organization or an individual, the ultimate goal is the best quality of life given the resources (including time, often over-looked) and forces (our efforts; external ones beyond our control) interacted and enacted upon them

[Dadhawk]

Originally Posted by extrashaky

...I agree with Koa 100%... .

I've read through this a couple of times, and don't have any real disagreement with you except I don't see anything that you can do by borrowing money that is more advantageous than paying cash.

For example, the things you wanted to do to your Jeep you could have cash-flowed from the payments you weren't making if you had paid cash for a car.

Originally Posted by extrashaky

...I could have bought something even cheaper than the BRZ, but there was value in driving something that gives me pleasure while making me money. I could have bought something more expensive, but the marginal increase in personal satisfaction wasn't worth the extra expense. A brand new Corvette might have made me happier, but certainly not $40K happier..

This is also what led me to the FR-S instead of my second choice, a ZL1 Camaro. Had the C7 'Vette been available in 2012, it may have been a little harder choice for me!

[Defuser]

The "smart" rich make their money work for them by leverage. If you can secure a low interest loan, and use that capital to capture a larger percentage of profit, that is just good business.

Many of the uber rich are leveraged, their wealth being largely on paper. If I can put more $ into my 401k, instead of into a cash purchase of a vehicle, I am using a similar strategy.

Paying cash is great, only if you can't get a rate that would make your money otherwise more advantageous.

More wealth is built upon a premise of "other peoples' money" than any other ideology. Reference: stock markets.

[themajesticone]

Originally Posted by Shinchu

So, I have wanted an FR-S since before we even saw the concept. now that its actually available, i have been going MAD trying to figure this out.
I have a 2013 altima that sucks but i am about $5k upside down. a 2013 accord that i love to death and its a lease thats over-miles and been hit twice. and my AE86 that i have pretty much decided will get sold to make room both in the garage and financially for the FR-S as the new money sponge. HELP???

HOW do i get an FR-S!??!

am i just financially pigeon-holed?
if i could get rid of the altima somehow, i would be down. i was going to use money from the sale of my AE86 to pick up some goodies for the FR-S (coilovers, wheels, intake/exhaust, etc.) but i suppose i could use money from that to pay down the altima and hopefully use as a trade in?

are there any members here that are dealers/salesmen that could help me out with some advice?
is there a way to get rid of the altima and NOT have to use money from the AE86? aside from uh, "gee i dont know officer, i came outside and my car was on fire?"

I'm literally on the verge of selling bodily fluids here...

Read a book on cash flow and money management. Learn how to save and not spend more than you have because clearly you do not know how.

[extrashaky]

Originally Posted by Dadhawk

I've read through this a couple of times, and don't have any real disagreement with you except I don't see anything that you can do by borrowing money that is more advantageous than paying cash.

For example, the things you wanted to do to your Jeep you could have cash-flowed from the payments you weren't making if you had paid cash for a car.

But there's also no advantage in paying cash when I can finance the car and use my cash on the Jeep immediately rather than piecemeal as my paychecks come in. I didn't mention that this Jeep project is budgeted at $22K. I could have spread that out by paycheck over the next year. But one thing I've learned about projects is that, when done piecemeal, they cost more and take more time than you anticipate because new problems arise that you're always chasing rather than addressing everything at once.

The advantage for me is that I'm able to get the enjoyment I want out of both the BRZ and the XJ sooner by using leverage. That enjoyment has actual monetary value to me, and that value is actually considerably more than the tiny bit of interest I'm paying. Sure, I have a little more risk, but I'm prepared for the consequences even if everything goes south.

That's another point that needs to be made. Financial responsibility is not about avoiding all risk. Financial responsibility is about understanding the consequences of risk and being prepared to accept those consequences if everything goes south. My risk appetite isn't any larger than my wallet can handle.

[campy]

Trade the AE86 for a new FRS. Trust me, someone out there is dumb enough to trade a new car for one of those over-hyped 30 year old economy rust-buckets.

[Shinchu]

haha okay there is a lot of misconception going on.

yes i am deployed.
i drive 70 miles each way to work WHEN I AM NOT DEPLOYED lol

i have lived in temecula since 2009 and my mortgage is only $1650.
my daughter is only starting school in san diego in january and even then it might be just one year, if more we WILL move back down to san diego and live in base housing. (pocket money from sale of house, looking to sell for about $380K right now, we bought at $245k... CHA-CHING)

so i guess i really started this thread as "thinking out loud, and if somebody overhears and has a solution thats cool".

and yeah i am a 35 y/o E-6, served for 15 years and planning on 20. i have done a great deal of "growing up"? sure i like to spend money but you have to pay to play and i believe in staying young at heart. i get told all the time i look like im 25 so i guess it works haha

so all that said, i DO agree with most of you, and that the best thing i can do is calm the eff down and wait. you guys would poop if i told you how many cars i've been through since i moved back from japan in 2008 haha.
what can i say, i like cars.

thanks for all of your help and interesting sidebar convo. good to hear about others experience as well so its not one big "rag on the new kid" thread lol

so yeah i will just take a chill pill, wait til i get home and see whats going on with moving to san diego, AND FOR THE LOVE OF GOD JOIN A VANPOOL.
i did for the 6+ years prior to this. the last 3 months before deployment increased my mileage significantly. really racked them up on the accord quick. oh and the reason i leased? it was actually cheaper. maybe not in the long-run, but it was a lower down payment (yay!) and, lower monthly payment (yay again!) sure at the end of 3 years i will not have paid as much, but my $350/mo beats the snot out of my wife's $410/mo for a million years. there is a long story behind that altima. my wife apologizes for that all the time.

anyway, thanks for all of your contributions, as hard as some of them were to hear (read?). will keep y'all posted. if you care, that is.

[Dadhawk]

Originally Posted by extrashaky

But there's also no advantage in paying cash when I can finance the car and use my cash on the Jeep immediately rather than piecemeal as my paychecks come in.....

No advantage might be a little strong, but I do get what you are saying.


In the end an individual can do it either way, and I have done both. To me, its a little bit about how folks used to talk about our grandparents and now great grandparents that lived through the Depression, and how it influenced their view of money.


I lived through the corporate leveraged buyouts/takeovers/layoffs etc of the 80's early in my career. I was "leveraging" other people's money when that happened and then got laid off from 3 companies in six years and realized how vulnerable I was.


I decided never again, and have never looked back. If you view it differently, its all good, we'll still be friends, but I can tell you that, for me, there is nothing I need so bad today I can't wait to buy it until I can afford it.