I spoke to a woman who had about $75k in an account that she didn't even know she had.
The lady rents a nice apartment in a nice area for about $1200,00 a month.
When she left her old job she told me that she wanted to buy a used Range Rover for about $50,000.
In this market, people often only stay in the area for three to five years to work on projects at one of the many refineries.
This has caused a huge market for those only looking to rent houses - and the prices for doing so have risen dramatically.
If the woman would have bought the house and used the rent money to pay for her Range Rover - In five years, she would have had a Range Rover and a House (which would still be generating income) both fully paid for.
In the end, the stupid girl just bought the Range Rover.
(On the bright side - one of the woman's co-workers heard my advice and bought two houses for cash and financed a Maxima with money left over each month from the rent collected on the homes to service her new purchases.)
I've got a relative who's long-term unemployed. She's thinking about spending her entire cash savings on a BMW. She owns a great apartment, that's all she has, but she could rent that out & live elsewhere comfortably. But she won't. It doesn't fit her image. In time she loses the apartment, the maintenance is killing her, but she won't deal.
ReplyDeletecars are not investments, they are a tool with an associated expense.
ReplyDeletebrohammas, yes, or a combo of Tool and Toy. $20k buys all the tool anybody needs for getting people around; the other $30k+ that these jokers spend is all toy. Don't know about them, but I can't afford that kind of toy.
ReplyDelete