Holding debt while owning a P-car

[Hendog]

I’m constantly torn up over owning my 911 while having a mortgage. We don’t have any CC debt nor any other type of debt.

I raise this issue after having read another thread where people are shedding their CC debt after some time, and they also own these P-cars. As I said, we have no CC debt, we own our three cars and only owe on the Mortgage. I have a good job that earns me “more than most but less than many”. Our credit rating is solid. We took out a 25 year mortgage 4 ½ years ago at a below prime interest rate. We’re making accelerated payments plus some; we have approx 13 years left at this pace. We have no kids. My wife works part time. We’re in our mid-late 40s.

If I sold my 911 and put that $xx on my mortgage I would reduce my principal by $xx along with the accrued interest. So my 911 is actually costing me interest I would not otherwise have to pay on that $xx amount. THAT is what bugs me. Even though the Pcar is paid for, I feel it’s costing me on my mortgage interest.

So I’m torn between being financially practical and enjoying something in life. How do you guys reconcile the two?

[carnutzzz]

Why are you trying to quantify a hobby?

And why are you trying to pay-off a cheap mortgage so soon?

You sound like a bundle of nerves.

[Rikao4]

relax a bit,
your MUCH better of than most folks,
you have a plan,
enjoy something..

Rika

[Dantilla]

I'm also debt-free outside of my small mortgage. In the long haul, real estate is still an appreciating asset. Sure, we've currently hit a blip where things are a bit backwards, but I could still sell my house today for far more than I paid.

I don't mind making payments on my house, and don't feel bad one bit about a paid-for Porsche sitting in the garage. Especially since it's a long-hooded 911, also going up in value.

A Porsche is going to hold its value better than a Toyota. You're wise to buy a house, and wise to drive a Porsche.

No reason to beat yourself up over little stuff.

[Rot 911]

You sound like you have a lot of disposable income. Keep making extra payments on the mortgage and have fun with the 911.

[TheMentat]

Originally Posted by Hendog

How do you guys reconcile the two?

Interest + Maintenance + Depreciation + Gas = The price of the fun you are having with the Porsche. Interest is probably the same as the gas bill when you think about it.

[Heel n Toe]

If you had a gambling addiction, that would be something that should bug you.

Owning a P-car along with all the other elements of your financial picture is not being indulgent at all, the way I see it. Enjoy it.

Our financial picture isn't nearly as good as yours, and I don't have a P-car... nor will there be money any time soon for any kind of "fun car."

Reconcile that.

[MRM]

Dude. Chill. What good is having money if you don't spend any? What good is saving money to spend later if you have to wait until most of your life is over before you feel comfortable spending some of it?

The key is to have ballance. Make enough money to live on, save wisely and spend enough to enjoy yourself (and reward yourself for your hard work) without being imprudent.

[Porsche-O-Phile]

Worst case if something comes up, you just let the hobby sit for a while, focus on your obligations and then pick it up again when money is more available.

And believe me, there will be plenty of opportunity to do projects that just require time or labor rather than $$$ if you believe in doing things yourself. You'll have plenty to do even if you can't afford part "X" that week. Ask how I know.

I never saw it as an issue. I suppose if was your only car or something it would be though.

[scottmandue]

Don't know how things work in BC but I have been advised NOT to pay off my mortgage because of the tax write-off.

Honestly If I hit the lotto (if I played lotto) I wouldn't pay off my mortgage.

[ramonesfreak]

compared to you, i am a disaster. i got so depressed reading this post and the "no CC debt" post that i dont feel like even visiting this site for a while. i spend more on cigarettes per month than i do on all 3 of my vehicle pmts.

one thing ive learned, seeing friends and family and clients die way to young, is to do at least some of things you love, TODAY. If that means not paying your mortgage off early, so what. there are no gaurantees that youll be here tomorrow

[Hendog]

Originally Posted by scottmandue

Don't know how things work in BC but I have been advised NOT to pay off my mortgage because of the tax write-off.

We can't write off the mortgage interest in Canada.

[KFC911]

Originally Posted by MRM

Dude. Chill. What good is having money if you don't spend any? What good is saving money to spend later if you have to wait until most of your life is over before you feel comfortable spending some of it?

The key is to have ballance. Make enough money to live on, save wisely and spend enough to enjoy yourself (and reward yourself for your hard work) without being imprudent.

What MRM said! While you may have read my responses on the CC thread about being "debt free", you also only go around once in life and "ya can't take it with ya when you go". Balance is the key and it sounds like you're already there. Although "debt free" now, I actually used a HELOC to purchase my 911 (mortgage was already paid off at the time) some years back as I didn't want to liquidate other assets at the time. Enjoy your 911 and sleep well at night

[TerryH]

So you make a bundle and have no kids. Are you trying to leave millions to charity when you die? Life is too short. Try and have a good time without feeling guilty about it.

[berettafan]

life is not ALL about paying the least amount of interest.

i might be a slave to 'the man' with my mortgage, car payment, etc. but damn if i'm not having a hell of a time!

within reason of course

[vash]

hike up your skirt man! you may as well cut your own hair, and make your own clothing.

the greatest irony is when we are young, we have all the energy in the world, but zero money. grow old, lose energy, have some aquired wealth. effen lame. i wish we could flip one of those things...but we cant. so all we have is balance. the goal is balance.

[KFC911]

Ain't that the truth! I've not always been "debt free" and have sure had a good time on the journey of life. My take has always been to take care of the "important stuff" first, and then blow the hell out of what's left in my checking account on a regular basis, but never beyond that (i.e. CCs) .

[onewhippedpuppy]

Damn Henri, don't beat yourself up. You're in a damn good spot in life, your 21 year old P-car isn't exactly an indulgence. If you had a bunch of CC debt or had a loan on the car, my answer might be different, but you're in a great spot to justify a toy. I don't have a Porsche because I don't have the spare cash to buy one outright, and have student loans to pay off. I can't justify a toy right now, but you can. Be proud of where you're at in life, and enjoy that 911!

[Hendog]

I feel like I’m a little behind the 8 ball. Only in the last seven years have I started making decent money. When I was young I was told to find work that I enjoy and the money will come, rather than chase a job for money. Well it was good advice, since I haven’t been a high money earner most my career but I have enjoyed my work. I’m 47 now. I’ve always been conservative with the little money I made. Bought a little house when I could which allowed me to build some equity and then move to the west coast and buy high rise condo.

I married my wife nine years ago. She was making more $ than me at the time but had spent it travelling, except she too bought a place of her own. We both owned our high rise condos (not clear titles), which is what we sold to buy the house. The stress in her job took too great a toll on her health, so after some encouragement from me she left her job and now works part time. So, we don’t have much put aside for retirement but “while the sun is shining we’re making hay” and are hitting the mortgage. Our house will likely be our retirement nest egg, but I don’t think that’s good enough, which is why I question owning a Pcar while I have a mtge.

[onewhippedpuppy]

Personally, I would pay the regular payment on the mortgage and put the extra into a good ROTH IRA. Having a paid off house and no retirement isn't a very good scenerio.

Stop for a second and think about the money we're discussing. What's your Carrera worth, $20k? Would that money REALLY make a very big difference in your mortgage? I'll venture a guess and say no. In the grand scheme of things, it's really not all that much money.