pinkfloyd34
Registered User
- Messages
- 15
oh god, i was actually thinking of doing exactly that, but you have a good quality car for that amount with no repayments, car should last you at least 10 years before you think of even changing it
This. There's no quicker way to turn cash into smoke than buying a new or newer car, I'm speaking from experience
Spending 15k on a car will cost you up to 5k in depreciation over 2 years, all spent on feel-good factor. You should always calculate your overall cost of motoring to include what asset depreciation is costing you.
That said, there's nothing wrong with treating yourself to new wheels or holidays, if that's what you want to do. My point is that you're a mid-earning civil servant, which carries a lot of unknowns for future salary expectations in this climate.
On the rainy-day fund, I'd avoid having a pile of cash that's easy to get to.
I'd consider 3 levels:
1. Put some of it into a term deposit (e.g. 1 year). You can always get your cash back in emergencies, you'd just lose your interest.
2. Put some of it into a notice account like a 7-day or 21-day notice account. Having a 7 day cooling off stopped me making big ticket purchases I didn't need a couple of times.
3. Keep some cash relatively easy to get to, and try to make this a 'current savings' account which you top up where you can month to month. Let this build up before christmas, summer holidays, and let it dip on those occasions, but never too much
This protected a cash pile for me for years. The third level is key. Don't let this hit zero as you'll be back into credit card (and/or dipping into level 2) territory. Hold the line around 2k, and let it go over before christmas, and before the holidays. Think of it as your credit card and savings, which you bring back to 2k instead of a zero balance.
I know from experience how difficult it is to keep a cash pile that size, and I don't have kids! I'm sure you and your dependents are owed a treat, but be treat-wise, and work on never having debt and always having a little savings so you can treat little and often. Which would be better for you, one big trip to Disneyland, or a cheap sunny week in Spain once a year for 5 years.
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