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  #13  
Old 02-17-2011, 07:42 PM
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Re: I might do the unthinkable.

Sounds like a question for Suze Orman....

Anyway, I guess you have to look at what is changing. The Lexus ES300 is paid off....what can you get for it? The change is the difference between the Lexus ES300 and the Jeep. First, you'll have a 4x4 that can get you through the snow (important with a family), unlike the Lexus ES300. Second, you will have a newer vehicle that is safer esp. with the ACC. Third, you'll have a vehicle with a warranty for repairs.

I would first hold off on selling the townhome. You don't need a single family home with a kid under 2. I don't know what your real estate market is right now....but sell the townhome only if you can get a really good price for it and a deal on a new home. If you have a $200K townhome, you'll be out $12K+ to sell it and thousands on the new home.

The other issue is, what have you saved for retirement....if you haven't saved at least the cost of the Jeep in your retirement accounts (not counting your other cash).....then perhaps a shiny new vehicle isn't responsible. Are you saving at least 10% of your pre-tax income now???

If you always live below your means, esp with a $100K+ job, you'll never have money worries and that is priceless....
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Old 02-17-2011, 07:47 PM
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Re: I might do the unthinkable.

Save the car for later and take care of home 1st. Plus your doing yourself a favor for waiting until the WK has been out for a year or so to buy it.
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Old 02-17-2011, 08:16 PM
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Re: I might do the unthinkable.

Yeah there is pretty much no reason to buy a new luxury item if you cannot easily afford to do so. That might have something to do with this mess our economy is currently in.

Where I bought my vacation home a year and a half ago is like foreclosure city now. Almost all the homes in that area are vacation homes and people really stretched out to buy them and I know more than a few who ended up in bankruptcy because of it. The house I bought was in foreclosure, the people originally bought it (new) for 1.6 I paid 630.
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Old 02-17-2011, 08:31 PM
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Re: I might do the unthinkable.

Regardless of whether or not you move forward with the Jeep....do your homework on the real estate.....and you thought car dealers are difficult to work with and are clueless...just wait until you're dealing with Realtardsฎ.

Stay put and save up.....

I moved to Florida recently and was amazed on the crazy stuff that was going on down here with real estate. I rented a brand new condo on the beach for 1/2 the price of the cost of ownership for two years before making a prudent purchase.....1/2 million less than another owner paid a few years back...crazy. So be careful with real estate.
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  #17  
Old 02-17-2011, 08:38 PM
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Re: I might do the unthinkable.

this is going to sound sappy but here it is. as a father it is our job to sacrifice. we do so in hopes to make a better life for our wife and children. i have learned to find joy in putting off my wants for the other money suckers in my life. i look forward to the day they are out of college. i bought my wife a new x and made her happy, plus i get to drive it. welcome to the daddy club. live by dave ramsey and you will be fine. read she calls me daddy and raising a modern day knight and you be even better
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Old 02-17-2011, 08:43 PM
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Re: I might do the unthinkable.

I don't know you personally and don't think a public forum would be the place for advice. But here goes.

Just because you're having a baby doesn't mean you have to buy a big house and get a van. It's just one little baby that will take years to grow. Your current sedan is paid off and fine for a baby car seat. I'm not sure what your recent wife drives but as long as it's a mid-sized sedan, you should be fine. Better if it's paid off.

You've been in your town house only 4 years and not sure if it was new construction. You're probably going to lose money on it if you try to sell. It's probably going to take a while too. I personally know of people with houses on the market for a couple of years.

Keep your car and your town house. Concentrate on the needs of you and your wife while you still don't have any children. Go out. Enjoy yourselves. You haven't had much time as a married couple. You already have pressures of the baby and don't need to add to it with a house and car.

Enjoy your baby and taking care of it the rest of your life. It will be your new job. When the baby is taken care of and things settle down back to normal then you can look at something new.

You probably could get the Overland and trade in the older or less kid friendly vehicle but not the house. It could be the last nice car you get in a while. Just don't get a mini-bus (van), you don't need one until you have at least three little ones unless you can get three car seats in the back seat.

Remember, it won't be a life of DINKs any more.
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  #19  
Old 02-17-2011, 09:03 PM
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Re: I might do the unthinkable.

Thanks very much for all the information and tips guys I do appreciate it. I do want to say just a few more things because a few people commented on how our economy got to where its at because of peoples poor decisions etc etc. Well first off I would absolutely never put myself into a situation where I couldnt afford something, secondly im not necessarily a kid anymore I do have well established credit and do infact have a mortgage on my townhouse that I bought brand new about 4 years ago. I take pride in what I have and have very good credit. So its not an issue of trying to establish credit or being able to make ends meet because everything is fine in that regard. We live comfortably and my gov't job is very secure.
As far as the house goes we are still at that stage where we dont know what we want to do. Our townhouse is basically new and is good size so maybe it would be smart to just stay here for a few more years I dont know. I know I would be taking a hit on my place, but at the same time the place I buy would also be way down as well so its a toss up as far as thats concerned.

I did consider buying a used Overland, but the problem is any used one thats available now or in the not too distant future is going to be a very early built one probably made in 2010 that doesnt have features that I want such as ACC, saddle, or even quadralift for that matter. Thats the main reason I decided to go new.

As mentioned I did NOT buy anything yet I simply put down $250 and nothing more so I can very easily get out of this. As of right now im going to keep the order going as im sure there is still a month or two before its delivered and im going to really think this over and give it a lot of consideration into what you all said.

Dan JGC,
I know you asked about retirement and thanks for bringing that up because I think thats important as well. To answer your question yes I do save for retirement I have been contributing to my TSP/FERS accounts since I started with the FAA in 2006.

Basically, the moral of all of this is its time for me to start being a little more responsible and put others before me especially with a munchkin on the way. Can I afford this Overland? yes Do I absolutely need this Overland? no Does my wife think im an idiot? yes :-)
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  #20  
Old 02-17-2011, 09:27 PM
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Re: I might do the unthinkable.

JTS, Are you Air Traffic control ?! I think we'll need those foreverrrrr hehe But it looks like you have this figured out!
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  #21  
Old 02-17-2011, 10:51 PM
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Smile Re: I might do the unthinkable.

Quote:
Originally Posted by JTS97Z28 View Post
I know I would be taking a hit on my place, but at the same time the place I buy would also be way down as well so its a toss up as far as thats concerned.
This is an important point - since you are already "in the real estate market" as an owner of your townhome, you really shouldn't worry about moving from a financial perspective. If you sell the townhome and buy the SF home, and real estate values continue to fall ... well the townhome's value would have fallen too. Same consideration in reverse.

Base your decision to move on where you and your spouse want to be for the next ten years (don't forget to consider school district quality!)

DanJGC is right about the real estate market - it's a grind getting a good property, but there are certainly values out there.

As for the Overland - my advice is to delay gratification. I'm in pretty good shape financially, but I've been driving a 13 year old Jeep and a 23 year BMW for, well .. 13 years At this point, I'm excited about my forthcoming Overland, but heaven knows I've waited for it.

Unfortunately, new vehicles are one of the worst investments financially. You need to realize that you are paying dearly for the "new car" smell, etc. That's why I try to keep em a long time and really savor it when I do get a new one.

Lastly, Rosewood mentioned Dave Ramsey: I've listened to his show and on balance he makes a lot of sense. Financial peace of mind is a wonderful thing.
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  #22  
Old 02-17-2011, 11:41 PM
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Re: I might do the unthinkable.

The real estate thing isn't as simple as saying all real estate is down so it isn't costly to move. it is costly. More costly than most people realize. And moving is purely an expense....a huge transaction cost that you will never ever recover. Don't listen to real estate agents for investment advice...heck most can't even take a good listing photo.

You'll be paying the 6% (so on a $200K townhome that's $12K) and other costs, plus disruptions in your life. Then there are the closing costs on the new home and mortgage costs if you have a mortgage. Plus you'll want to decorate. And moving costs. Easily total move costs $20K lost. Plus the SFH probably has higher costs, taxes, etc..... However, SFH do tend to hold and build value better than say a townhome or condo...it really is market specific.

The only way it is really worthwhile to move after only 4 years of ownership is if you find one heck of a bargain on the new place and yet can sell your old place for a fair price.

There is a saying that you make money in real estate at the time you buy it, not when you sell it. What does that mean? Well, two things. First, you decide whether or not you want to participate in this real estate market. Then, second, you decide what you want to pay. When you go to sell it, the market decides the price and you have no power over that (as many people are now well aware) plus most people don't have the luxury of deciding when to sell (as many people are also now well aware) since often it is a life event outside their control....change of job, illness, death, divorce, etc.... So, buy it at a bargain price and you will be way ahead of the rest (better off than most but no guarantee of making a profit).

Homes are mostly a store of wealth (for many a forced savings account) that is protected against inflation but has little real rate of return. It is a place to live, not an income producing investment.

Illinois is still a declining real estate market. Will it go down 30%, probably not. But it won't rebound with any significance either. Probably will be a stagnant asset for at least 5 more years.
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  #23  
Old 02-18-2011, 12:18 AM
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Re: I might do the unthinkable.

James,

Congratulations! Its sad to hear you may be giving up the overland but you're making the right decision. My son is turning 6 months tomorrow and I've been married a little over a year now. Nathan just called me today with my VIN number. It looks as though I'm going to head to Chicago after all. We should grab a beer when I'm out there. By the way, do you know what you're having yet?

Albert
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Old 02-18-2011, 07:33 AM
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Re: I might do the unthinkable.

What part of this issue is "unthinkable"? Canceling a factory order for a car? As you go through life your perspective will change in ways you cannot grasp now. You will look back on this decision and laugh at the fact that you even gave it a second thought. I'm not being dismissive of the thought that you're putting into this dilemma, just sharing a glimpse of what your world view will evolve into someday, God willing. Happens to all of us, as it should.

You are on the threshold of an enormous and life-changing event. Congrats on your recent marriage and the start of your new family, James! Your priorities seem to be well in order my friend. Trust your instincts; sounds like your decision has already been made.
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