Jun 10 2010

Admitting to yourself that you can’t afford something

Well it looks like I’m doing it again.

The house

Last year,  for a little while I thought we could afford a house. I fiddled with the numbers on paper and thought we could make it work. Hah! Funny joke.

I saw how insane property taxes are here. And how incredibly old a lot of the houses are here, and how much work so many of them in our price range needed. And how, if I wanted to live in a certain area, I’d have to spend way more than we could afford.

A house we could comfortably afford wouldn’t meet our needs in terms of what we wanted. The location, size, features…it was all wrong.

So rather than buy a house that we didn’t want (or worse — overextend ourselves by trying to get something we liked but couldn’t afford), we opted to keep on renting.

It was a bummer. But I’m glad we made that choice.

The van

Now, it seems that we’re making a similar decision with regard to a new-to-us vehicle purchase.

We thought $10,000 would be a reasonable figure for a van. That’s a lot of money to me! We wanted something with excellent reliability ratings and mileage in the 50-75k range (or less).

I don’t think that combo is really possible. If I wanted a low-mileage van at that price, I’d have to go for a Kia or Chrysler, which both have a number of reliability concerns according to Consumer Reports and random people’s reviews on the internet.

Or, we could go with a more reliable brand — a Honda or Toyota — but we’d need to get something with a lot more miles on it. At least 100k.

Since we are a one-vehicle family, we need our one vehicle to be reliable. I know Hondas are supposed to go forever, but 100k miles is an awful lot.

Our Ford Focus is a good car. We’re the original drivers. It doesn’t quite have 35,000 miles on it.

We started saving for a second vehicle because we figured Shane would need a car to take to work when we moved to Indianapolis. We thought we’d have him drive the Ford to work, and we’d take our savings and buy a van.

But then, I thought, “That’s too expensive of a car for that. What if we sold it while it still had decent resale value and bought the van now?”

It’s already cramped in our backseat with one car seat. Add another, and good gravy that’s crowded. Plus, it’s annoying to have the front seats pushed way up. I like my legroom! But I also like extended rear-facing, and safety trumps my comfort.

The reality check

It wouldn’t be a good idea to compromise on what we wanted. Since we can’t afford what we want, we thought we’d step back a minute to look at our overall situation.

We’re only having one more baby this December. We don’t need a bigger vehicle for the time being. Would it be nice? Oh, of course. But I think we can make it work with our Ford. If we’re able to move to Indy next summer, then most of our family will be within an hour or so of us. We won’t need tons of cargo space to visit them. And I don’t expect to need space to transport family around, since again, they’ll be close enough where they’ll just be able to drive their own cars.

Perhaps I will get a different, slimmer car seat for Johnny. The new baby will get an infant seat and his or her own convertible, and I’ll be sure to get space-savers if possible.

Because truly, even a few really expensive car seats are still cheaper than the sales tax alone on a $10,000 vehicle purchase.

And since we do think we’ll need a van at some point in the future, we don’t want to just get a slightly bigger vehicle, like a crossover or a wagon or a bigger sedan. That vehicle wouldn’t be useful for too long, so I don’t think it’s worth the hassle or additional expense.

I don’t quite know what we’ll do about it in a year’s time. We might move to Indianapolis and have incredible luck and still be able to be a one-car family. Or maybe, we’ll get a cheapie commuter car for Shane. Or maybe, we’ll have him drive the Ford to work, as the original plan, and get the van for me to drive.

I do know that in the next year or two, we want to buy a house. That’s the bigger priority. We’ll be putting as much down as possible, to the point that it might mean we’d need to take out a loan for the van. Yes, debt.

I know Dave Ramsey would yell at me for even typing that, and tell me to keep on renting or to just buy a vehicle that we can pay for in cash. We’ll do that if we can make it work, but if not, we’ll get a short car loan and pay it off as quick as we can and not beat ourselves up over it.

Sigh.

It is truly frustrating to have to admit to yourself (and all your blog readers) that you just can’t afford to go ahead with what you wanted.

You can’t always get what you want…



17 Responses to “Admitting to yourself that you can’t afford something”

  1. But sometimes, you get what you need!

    And I’m sure you will. I think it’s great that you post about what you’re thinking about. You thought about making a big purchase, but when it didn’t work out, you also got to post on why. I think that’s way more helpful than only posting on what you know you can afford. And, of course, it’s great you can admit that you can’t afford it right now and it’ll have to wait. That’s tough to do even privately sometimes.
    .-= Bethany B-A´s last blog ..Fake Bacon =-.

  2. Oh, Kacie. EYE have to admit something. Sometimes, I hate Dave Ramsay.

    There. I said it. He is just SO rigid, and he makes so many frugal folks feel so guilty!

    The truth is, we’re still pretty young and even though you and your husband are providing comfortably for your family, you’re living on a single income and you’re just starting out. You just haven’t had time to amass wealth.

    I just don’t think that ALL debt is the devil. Things like a house and a car, and yes sometimes even a second car, are necessities, and unfortunately our culture has set it up to make it very difficult to buy one without taking on some debt. It’s not impossible, but at our age with so many other goals to work toward, saving that kind of cash upfront can take a LONG time. I don’t see anything wrong with taking advantage of the healthy credit you’ve built to borrow that money at a good rate, especially since you plan to pay it down quickly. You’re not talking about leasing a brand new sports car here. You’re talking about a used, reasonably priced family vehicle that you will drive for years!

    Striving to be debt free is such a great goal, but DO NOT beat yourself up if you can’t get there yet. There are so many people in the frugal community who don’t even wake up and start repairing the damage to their finances until they’re well into their 30s. You’re 25, living debt free for now, and managing your money better than most people. If you need to take on a few thousand dollars of debt for a few years, you’re still doing GREAT.

    You will get to the point where you can buy a car with cash and avoid debt. It just might not be in your 20s! That’s okay! So you’ll save a decent down payment instead, and pay down that debt as fast as possible. No biggie. Don’t let it bum you out or take away from what you’ve accomplished.

  3. Oh, and I said house, but I meant “place to live.” I think it’s smart to wait until you’ve got some money saved to buy a house, but I also don’t think anyone should beat themselves up for taking on a mortgage to buy a house when the time is right. As long as you’re responsible about it!
    .-= Karen´s last blog ..Preparing for baby =-.

  4. What Karen said. Yup. Exactly.
    .-= Mary @ Tips&Treasures´s last blog ..New Huggies Enjoy the Ride Rewards Codes – worth 70 points!!! =-.

  5. My blog ate someone’s comment! I read part of it…I think the commenter’s name is Tammy? Or it starts with a T maybe?

    Anyway, she was talking about Dave and feeling stressed a little…and the next thing I knew, the comment vanished. :(

    If you’re that commenter, please please repost the general gist of your thoughts! I wanted to read what you said.

  6. Hey Kacie

    It was me who commented…I guess it was because I rambled on once again! :) So the system ate my post! LOL! Must be a word limit!

    Just kidding, I’ll see if I remember what I said!

    First off, I totally agree with everything that Karen said! She is a wise woman!

    I have to tell you that I took the Dave Ramsey course, and I had to learn that all of his ideas were not for me. If I had decided to follow his program to a “T” I would have been completely stressed out! As it was we did apply some of his principles to our financial life and paid a 4 year car loan off in 1 yr and 9 months! But if I focused on following the program to the letter I would have been obsessed with our money and thus made it an idol in my life instead of focusing on the great life and family that the good Lord has blessed me with! So while I think his program is invaluable, I do think you have to be wise with it and apply to your own life what works for you. (personally I think every graduating high school senior should take it!)

    That being said, I agree with Karen that not all debt is evil. If you are responsible and manage yourself well, it can be a help to have some credit every now and again, assuming one can control one’s self. Let’s face it, if you live in the northeast or on the California coast, chances are it will be decades before you can save enough money to buy a house in cash…I say this assuming that one has a modest income with only one person working. Yes, yes, I know that people do pay for a house with cash, but typically that is an exception not a rule (I really tip my hat to those who do it…I just know we would have been saving for 15 plus years before it would have happened). I think it is very wise for you both to be saving as much as you can to put down on the house! (I don’t think that was in my original post, but hey I’m going with what I’m lead to write right now.) And you should continue that.

    But, as far as the van. Don’t beat yourself up on not purchasing a van right now. As you said yourself, you don’t know what will happen in a year. The baby isn’t coming right now so you have some time and your need for more space in a vehicle is not immediate. And who knows what will transpire. You could come into some money or you could find that perfect van for $10k! Prayers can be answered! He says ask and you shall receive. So just because you have put the idea on hold doesn’t mean you shouldn’t keep your eyes open for a deal!

    I think it is great that you guys are being so careful financially. Especially at such a young age! I know people in their 40’s and 50’s who still don’t get it and are $40k+ in debt and adding to it everyday. Personally I couldn’t sleep at night…but that’s just me. I think you made a very wise decision in holding off on buying right now…you will find something, but in your own perfect time. So pat yourself on the back! You are doing a great job! And being very wise!

  7. Good post! I’ve been away from this blog for awhile. I’ll say it again, I wish I’d had your sense at your age! It’s really uphill trying to build retirement, etc, at 48! Keep living in the apartment and driving the one car–it really will “pay off” in the end.
    .-= Lisa´s last blog ..What we’re reading & watching =-.

  8. Girl – I applaud your decision not to go into debt to get a car. When my husband started listening to Dave Ramsey I seethed with hatred. I thought Dave Ramsey was ruining my life. Now, debt free, I couldn’t be more thankful we applied his wisdom to our finances. I think you’ll totally get by with one car. That said, I don’t think 100,000 is ridiculous for a Honda – but that’s just my opinion – I am after all driving around a Jeep with 200,000+ miles, so take it or leave it. And, when you finally do get that van you’ll appreciate it so much more for having had to wait for it!
    .-= Laura Stiller´s last blog ..still:image photography – Mandy’s Bridals =-.

  9. Oh don’t be frustrated. You are just being smart. It will all pay off in the long run.

  10. Sometimes realizing instant gratification isn’t the best thing stinks! Boo maturity! I still <3 you though!!

  11. I think it is sad that people don’t realize that the 8k “credit” actually comes from other hard working tax paying people. Not “free” money from the government. At least you have enough common sense not to get in over your head like so many other people and blame everyone else.

  12. The Sunshine Radian has a nice narrow seat. You can fit three across the back…although it is still tight :) If you really want the Toyota or Honda just keep looking around, keeping your eyes open. Sometimes you’ll be able to find the right private sale! It can be frustrating waiting because when you want something, well you want something but the pay off is worth it.
    .-= Crys´s last blog ..Lost in Austen =-.

  13. I think you are making a very wise decision. You will not regret this, but you might have regretted forcing something that wasn’t right. Trust me, I know, we are living that regret every day. We saved $10,000 for a van and needed one then, rather than waiting to pay for the whole thing in cash. So we though we would just put the $10K down on a new van, take out a loan and pay it off within the year. This loan has wreaked havoc on our budget and all our money worries stem from the fact that we have this car payment and this big debt. yes, I know it isn’t that big of a deal, but suddenly when you have a large van payment you can’t cash flow other problems that arise and they keep arising even though you don’t have the money to pay for it.

    so good for you sitting tight and waiting. Everything will work out in the end. Just keep saving your money as best you can.
    .-= Jennifer´s last blog ..June 9th and 10th =-.

  14. Seconding the Radian line by Sunshine Kids for narrow carseats. We have 3 of the Radian 65, which goes from 5 to 30 lb rear facing, and 20 to 65 foreward facing. They all fit in the back of our tiny Saturn. They are not cheap, about $200, but they test out at the top for safety, like the Britax line, and are very streamlined. Our oldest, age 5, is 65 lb and over 4 ft tall, and he is still very comfy in his seat.

  15. I can so relate to this post. Right now, our main priority is retirement savings and paying off our house. We’re hoping to have the mortgage paid off within the next four years, and unless my car completely dies before then, we don’t plan to replace it until the mortgage is paid off. We’re also fans of extended rear facing (we just turned the carseat around last week and our little guy is two), and both of our cars are a little on the cramped side with the throne carseat in the back. And someday we’ll probably have another kid – likely long before the mortgage is paid off. I’ve been pondering the issue, and coming to the same conclusions as you. Technically we could afford to upgrade to a bigger vehicle, but new carseats are a whole lot less expensive. Also, buying a bigger/newer vehicle would take set us back on our mortgage repayment goal. So I think for now I’ll just keep walking with our son in his wagon or stroller and hopefully push that car purchase off as long as I can.
    .-= Frugal Babe´s last blog ..Reducing Our Dependence On Cars =-.

  16. You gotta be one in a million, most people don’t think when it comes to spending money on the kids. You should put together a tool kit, or a check list for people. The “Can I afford it process”
    .-= Bankruptcy Ben´s last blog ..Squeezing Every Last Cent! =-.

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Hey! I'm Kacie, wife to Shane and mother to Jonathan (7), Vivienne (5) and Amelia (2) . I write about my family's finance: how we save money, improve our spending, and plan for the future.

I hope I can inspire and encourage you to improve your situation. See disclosure.

I'm adopting a much slower-paced posting schedule, and treating this as a hobby blog now.

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