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Old 09-24-2017, 09:42 AM
 
Location: Columbia SC
8,954 posts, read 7,733,997 times
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I am 75, collecting SS and have been drawing down some from two non-IRA mutual funds. I have not touched my IRA funds except for the RMD. I do not expect to have to touch the IRA's for the foreseeable future but they are there for me when and if needed.

I recently purchased a new, 2017 Ford Explorer. With all the bells and whistles on the vehicle and a trade in on a 12 year old Suzuki Gran Vitara, I walked out the door with the Explorer for $35K. I cashed in some stock (P&G and my only direct stock holding) to pay cash for the vehicle. I expect this will be my last vehicle....LOL

I spent about 6% of my net worth.
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Old 09-24-2017, 12:07 PM
 
Location: SW Florida
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Originally Posted by Tall Traveler View Post
So far, it looks like I'm the only person that considers my wealth as a factor in deciding how much to spend on my cars in my upcoming retirement....this surprises me but I guess this is what makes the world go round, everyone has a different opinion.
I never thought of what we'd spend on a new car as a percentage of our "wealth", we just figured the amount based on what we were willing to spend to pay cash for the car. We just purchased a new 2017 Honda Civic (we like Hondas and currently have three of them) to replace a 2008 Civic we had purchased in 2011 as a certified pre-owned vehicle, which was beginning to cost us more in repairs than we were willing to spend.

We have a savings account we use for unexpected expenses and since our ongoing debt is low and income good we are able to add money to that account every month, and I'd guess we spent about 12-13% of the amount there to pay for the car. As a percentage our total funds I'd say it is maybe 3-5%.
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Old 09-24-2017, 12:26 PM
 
Location: SW Florida
9,745 posts, read 7,030,085 times
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Quote:
Originally Posted by Ruth4Truth View Post
OP, honestly, by the time one is retired, one should be past the stage of wanting "exciting" cars. One should go for what's practical. How long do you usually keep your cars? Until they die, or for a few years, then trade them in? Has your policy in that regard changed, now that you'll both be retired? I think the important thing is to be realistic, and to keep in mind that unforeseen expenses can happen in retirement. Especially in the later years, when one might need home health care, which is very expensive.

My brother and his wife will soon both be retired, and they're planning on buying used cars, only, from now on. She's a nurse, so she plans on putting in a weekend here and there, to keep a trickle of income happening, but they're still battening down the economic hatches, to play it safe. You're at a stage of life when nothing can be taken for granted, even your nest egg. Bear in mind that during the dot-com bubble burst, people lost about `1/3 of their investment funds, just from that. That really hurt people who were retired. Also bear in mind that the Glass-Steagal Act, which prevented debacles like the 2008 home loan and securities fiasco, has never been reinstated. The root cause of that crisis was never addressed. Your nest egg is still vulnerable to another similar crisis, to name only one of many factors that can, and some of which probably will, negatively impact your retirement funding.

It's best to be cautious and prudent in ordering one's priorities and deciding what to spend, and what to spend it on, IMO.
You're probably right about the used cars, and in the past we have gone the "certified pre-owned" route. But this time around, we were a bit leery of buying another used car, as there are so many out there that have at least potentially been flooded in the hurricanes and rainstorms that have hit Texas and Florida, and that information is not always disclosed to a potential buyer. In fact, we discovered with the Carfax report for the last pre-owned certified car we had purchased in 2011, (we were trading it in on a new car), you may not know all there is to know about a used car you purchased even with a Carfax report when you buy it. We knew the car had been in a "minor"accident and repaired, the dealer told us that and I think I recall seeing it on a Carfax report (or the part of it the dealer showed us), but what we were never informed of was that the vehicle had been reported stolen and was recovered-no details on the 2017 Carfax report, so there is no way to know what happened to that car before it was recovered. I don't know if the dealer we bought this car from was aware of it's being reported as stolen, but if so they never informed us, and we went by the portion of the Carfax report they showed us (we should have paid for our own report).

Anyhoo, we decided to go with a new car, in a price range we could pay cash for and not miss the cash all that much.
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