How do people afford to...

Discussion in 'The Lounge' started by soua0363, Nov 15, 2007.

  1. soua0363

    soua0363 Master of Nothing

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    Just got to thinking how and what people do to be able to afford a $200k home plus utilities and own a couple $35k+ SUV and truck...some even with a $30k+ boat? My wife and I both make good money and I know that we wouldn't be able to do it and still have money leftover for every day things. Does any one know the secret and is willing to share some information because I would like to own a $40k truck, my wife would like a $40k car, and oh a nice bass boat too but do not forget that I still need to be able to pay for my house? :D
     
  2. seethe303

    seethe303 Senior Executive Member

    they make a ton of money???

    or

    they are up to their ears in debt???
     

  3. Toxic

    Toxic Defensor Fortis

    I owe, I owe, it's off to work I go, I owe, I owe.................:mad:
     
  4. I see alot of people my age (27) with way more than I have as far as better house ,multiple cars, a couple of vacations per year...It has to be that they borrow borrow and borrow. I make $30/hr and have a home, new truck and just about everything I need but refuse to over extend myself so I will not build a $200k house. I use my credit enough to keep a real good rating but dont go all out. Alot of the people my age just buy, buy buy and a couple of years down the road will divorce of whatever from their poor decision making early in life.
     
  5. misfit

    misfit MOD SQUAD

    yep..........both of the above;)
    i know people who actually do make a good living and can afford those things with ease.i also know a few who pretend to be able to afford it and are looking over their shoulders for the repo man every time they walk out the door:D

    then there are yet others who drive big fancy cars,dress to kill,but live in a dump in the slums with kids dressed in rags and eating mac & cheese every day,just to impress the rest of the world:rolleyes:
     
  6. K gonefishin

    K gonefishin Bit by Musky bug

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    Yeah I think a couple of you hit the nail on the head, borrow, borrow and borrow, I have seen alot of people ring up credit cards up to 20K before they even turn 25 and roll negative equity into new car loans, take out second mortgages making there lone to value over 100% and etc.

    People like to have things, fact, but most people don't care they they are over extending themsleves and your right they end up in very bad debt and nasty situations. Look at the forclosure rate on houses in Ohio. it's at a record high and it's only going to get worse IMO.

    People want nice thing but for whatever reason they don't want to work harder or smarter to get them, you can't live everyday life trying to have nicer things without more income being brought into the house. Another thing is the keep up with the "Jones" factor, if you make 75+ per year yeah you can afford a little of that once in a while but can't if you only make 35-40K.
     
  7. #1: Having excellent credit allows you to spend much less over your financing term on any secured loan...house, car, boat etc.

    ****************************************************
    Here's an example...

    Say someone bought a $200k house on a 30 year mortgage @ 8.9% interest
    vs.
    another guy with better credit buys the $200k house next door @ 5.9% interest

    The first guy pays $ 574,162.91 for his house over the 30 years @ $1594.87 per month.
    The second guy pays $ 474,192.25 for his house over the 30 years @ $1317.20.

    Difference over 30 years is about $100k
    Monthly difference: $277.69 (more that half of a car payment on a $40k car)
    *********************************************************


    The same is true for a cars and boats...good credit gets preferencial interest rates on loans and lower rent payments on leases allowing you to redistribute the savings to you other toys.


    Outside of that....given the specifications that you've given, I'd say your friends are probably making a total household income of about $150k/yr and NO KIDS! Or perhaps they may have had money left to them by elders. Or they may have made some good investments at one time or another (real estate, stock, etc). Who knows??
     
  8. alot of it has to do with the fact that it used to be hard to get this and that with credit, yeah its still hard to buy cars and homes and such, but there are so many "O BAD CREDIT NO PROBLEM" "NO CREDIT NO PROBLEM" deals out there now that people get in way over there head trying to keep up with the rest of there friends or people they know, i cant count how many credit card apps i get in a week, and i only have one and its not even a high dollar card, u come to my area pretty much anywhere around the dayton area especially down by miamisburg and springboro or beavercreek and ull be shocked and amazed at the not one or two but 100+ multi million dollar plus homes being built in specialized subdivisions, the question i have is how can an area like the Dayton Area support this when jobs and businesses are leaving dayton faster than u can say were moving, ive asked this question many a times in the past year to many developers and they all say dont know dont care as long as they builder the houses were selling.
     
  9. It's a bit off on the 40K car payment...at 3% you would be looking at a $725 car payment....but no big deal...

    It is crazy in my mind to own 2 cars and pay 40k each...but that's just me. It really isn't that hard to own all of that if you don't have other bills that are racked up. I think that is the main thing....but as said before most of those people are so over their heads in payments and living pay check to pay check...I just don't think it's worth it. The biggest thing is live how you want to live and can afford to live and forget about keeping up w/ the "jones". You'll be much happier in the end. Just my 2 cents.
     
  10. Agreed...but with good credit you could get a 4 year lease on the same $40k car for $500/mo, no problem.


    Take it from me...I've worked for banks for 10 years. People with money and good credit generally don't buy cars, they lease em. They only keep them for a few years anyway, they never have to put $ down, they don't drive long range cuz they fly so mileage is not of great concern.
     
  11. live within your means!!! i make 40k/year drive a 92 4x4 chevy-91 19' thundercraft cruiser-12 fishing boat and a 65k home... none are fancy and all are paid for eccept the house(9 years left) also have ZERO debt!!! AND I"M HAPPY to have that!!! dont worry about the ''jones''' and dont over indulge and things will come in time!!! oh by the way ...i'm 40!!!:p
     
  12. People thinking they have to spend $500/month for transportation in a depressed economy is part of the problem, IMO. What's wrong with driving an older, paid-off vehicle and spending $500/year in maint costs? Americans are just delaying the inevitable -- rethinking their priorities.
     
  13. freyedknot

    freyedknot useless poster

    the more you spend on toys the more you worry about them. live a simple life and don't worry about the jones's they are in debt and their money is going to the wolsteins and mbna.and don't forget the rates of payday loans ,the legal loansharks.
     
  14. 2talltim

    2talltim Bubby wanna be

    here is the question i always ask ...i know people that make just as much money or even more than i do they have just as much or less bills and debt than i do ...but every time i want to plan a trip or go do something they claim i dont have the money.....what do these people blow their money on ? the only thing i can think of is drugs..LOL
     
  15. Money is a talent. If you had 2 people making the same amount of money per year , even if they both spend wisely and try to live within their means, usually one appears to be doing a lot better than the other. I think the answer is just that one is more talented than the other at both making, keeping, and using money. Of course some get a head start from a parent or family member/friend in the beginning and are ahead of the rest from the get go. Then there are those who are deep in debt and it just hasnt caught up with them yet. I dont know how some people do it either it just comes easy to some.
     
  16. Agreed. It all comes down to living within your means. Last year I had to buy a new car because the one I'd driven for the past 10 years was shot. I wanted a flashy car. I decided to buy a 2000 Cadillac STS. I got a sharp, full-size V8 american car with leather and power everything for $200/mo rather than burying myself in a tiny 06 Benz C230 for $450/mo with no horsepower or space for my fishing gear.

    If you can REALLY afford a $600+ car payment a month....go for it!! But I can't...I know it...I'm comfortable with it and I did some homework and found something that makes me happy and is within my means.
     
  17. kids? - They are freakin expensive!
     
  18. Thank God For My Sugar Momma Lol.
     
  19. soua0363

    soua0363 Master of Nothing

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    I guess we're all in the same boat and do not know the secret of making a penny become a dollar bill. :D

    I understand the part about having good credit equals lower payments but still if you consider the costs of things I still do not see how an average couple can do it. Let's say that a couple brings home $4000 a month after taxes and their mortage is $1300 a month. That leaves $2700 for utilities and other expenses. Lets say they own two vehicles with payments around $500 each. That leaves $1700. Now figure $150 for electric/gas, $50 for water, $80for cell phones, $40 home phone, $80 cable, and $40 internet. That leaves $1260. Then lets say $150 a week for gas since they are both SUVs and since both wife and husband commutes. That leaves $660. Oh forgot about car insurance too...thats another $150 for this example. Now that leaves $510for the month without paying for any credit cards, student loans, food, and every day items. Oh yeah...forgot another expense too...daycare. How do people do it? And this example is saying that this couple are both making damn good money...I would like to know how the average American do it day in and day out because I know the majority of the people does not bring home an average income of $4000 a month after taxes.
     
  20. Lundy

    Lundy Staff Member

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    As a younger man with a wife and 3 kids I couldn't even afford to think about what I couldn't afford.

    We got married at 18 and struggled for years to get by. I worked two jobs, 16 hrs a day, six days a week, for nearly 3 years to pay the bills and feed the babies as the came.

    I drove old $200 cars until they were unfix-able then I would find another one. I still remember the Hornet, with no heat, an electrical short that would make the lights blink on and off and the hood latch broke and the hood blew back on the windshield, bailing wire ( no bungee cords in existence yet) held it down until it died.

    During those years we fell prey to the credit card debt trap, we had no choice. It took us nearly 20 years to become debt free

    My wife also worked part time on the weekends. My wife had no car and in fact didn't get her own brand new car until she was nearly 40.

    I spent all of my 20's and most of my 30's wishing I could afford a new truck or a boat or to be able to afford trips or vacations. We just couldn't swing it or justify it. I saw others with what I wanted and wished and hoped and schemed and rationalized going a little more in debt for a boat but just couldn't do it

    We now have been married for 34 years and are in pretty good shape money wise, we take multiple vacations per year, my wife has two cars, I have my boat and my toys and pretty much do or get what ever I (we) want within reason. We have ZERO debt,. we are saving money like crazy for our future retirement and don't have any real financial concerns. We are not wealthy but we are comfortable.

    I guess my point in all of this ramble is that we live today in a want it now society, instant gratification, even if it means ignoring the long term debt and consequences. I feel for those of you that are struggling, I was there for most of my adult life, I know how it feels. We worked extremely hard to get to where we are today, we earned what we have, but it took years and years to get there.