Help on deciding whether to stay with a low cost simple life, or to "live life to the fullest"
I'm currently at a crossroads for how I want to spend my next few years. For context I'm 33 and considering whether or not to purchase a vehicle after being car free for 12 years.
I rent a 600 sq foot apartment downtown and walk, run or bike everywhere with the occasional trip on transit. I fill up my free time with low cost activities like gaming, magic (the gathering), disc golf, and usually one paid activity like karate or climbing. I enjoy getting out to the mountains to hike when I can get a ride with a friend or meetup group.
I'm pretty content day to day, I have a good friend group, and it feels great knowing I only have to work for 12-17 more years while I am still young enough to enjoy retirement (If I keep my 50% savings rate). I do still splurge occasionally with a few weeks of overseas vacation.
I am considering getting a car as I feel it would allow me to:
- Go hiking more often, and on my terms. Most of the hiking groups I join are 10-20 people going extremely slowly. I run in a 100 mile trail run relay every year and a vehicle would allow me to train more and see how much I can push my body. Running a 50km, 50 miler, 100km, and maybe 100 miles would be goals that I can see myself training towards.
- Provide rides for people out to the mountains. The most luck I have had in meeting new people is through hiking groups, and being on the provider end and being known as someone that regularly hosts I feel can generate a lot more clout, and is seen as more attractive for the purposes of asking people out for dates afterwards if we bonded during the hike.
- Visit family and work remotely more often. I live 500km away from family, but my work allows me to work from anywhere within 1 or 2 timezones, so I could make 1-3 week trips to visit family and work during the day.
However I have the following reservations:
- Getting a vehicle I feel is a dangerous slope of lifestyle creep. Likely at least $3-5k in yearly expenses on top of the purchase cost, pushing retirement at least a few years back
- Getting a vehicle purely for pleasure as I work from home goes against my current frugal nature. What if I don't feel like hiking every single weekend? Sometimes I like just staying in a playing some games or working on a side project. What if I get an injury or it ends up being too smoky?
- The opportunity cost. Is this the best way I would want to spend my money to enjoy life more if I was dedicated to spending it? I could instead spend months in South America doing a bunch of awesome hiking and traveling there.
Has anyone else that was on track for an early retirement give in and decide to start spending more 10+ years out? I currently don't know what I want my retirement to look like, and a house and family is a huge question mark that I feel is so far off as the longest I have dated someone is just 2 months.
Have you priced out or considered rental options. I assume if you are in a decent sized city with the current access you have, rentals are nearby.
They will be pricey if you do it regularly but you won't have the purchase, insurance, or any maintenance to deal with. You can also budget differently for it. Instead of taking a car what if you set aside $1000 for this purpose. How long will it get you?
I briefly considered rentals, but when I looked at some of the companies in my city even booking a week out everything is sold out.
However it is worth doing a bit more research for me to figure out at what price point would I be willing to rent for 10+ weekends a year, and how far in advance I would have to book in order to get a rental regularly. Thanks for your suggestion!
One other thing on rental cars, I'd recommend checking if your employer has discounts with any rental company. Mine has a 20% discount which really comes in handy when travelling!
In an effort to not sound like an ad, Turo is sort of similar to AirBNB in that you can rent someone's personal car to use for a day or a weekend, and it generally is a bit cheaper and more convenient than a rental service. I have used it before on a couple occasions, and I also have a friend who started working for the company kind of recently. Could be worth looking into for your situation.
IIRC this is called "carsharing" and there's a number of different apps for it depending on where you live.
Go for it.
You can always sell the car if it doesn't work out the way you hope.
A few years added to working what seems to be a nice job isn't going to kill you. You get to enjoy the retirement activities now instead of waiting until you're 45.
This is my logic. I’ve had years in my 20s where I was able to live far better than most people ever will in retirement while still saving money. Sure I could work really hard or be really stingy and save some more money, but I won’t be able to do certain things if I save my recreation for when I’m older.
We don’t like to remember that we’re mortal, but your life plan should include considerations that you might drop dead from an aneurism a few months from now. So plan for the future, but also make sure to live it up in the meanwhile if you can.
I wouldn't worry too much about this because if you die, you die. There will be no regrets because you are dead.
There will be people saying "that guy saved so much money and ended up dead", but you won't care since you are dead anyway.
You can go do checkups every six months or yearly for this anyway.
I don’t know about you, but I have a bucket list (and anti-bucket list) and a number of the items on my list affect other people in a positive way. So if I am working a miserable job when I could be searching for something more meaningful that will also give me the emotional capacity to do more good in my free time then I’m doing things wrong.
I don’t think life has any inherent purpose or meaning. But if there is something to life then it will involve helping people and making them happier.
If you live in an area that has a service like like zipcar (car rental by the hour), you kind of get the best of both worlds. You might need to walk a few blocks to the car, but it sounds like that’s something that could fit easily into your lifestyle. You don’t need to fill out a thousand forms and stand in line every time you need a car, you also won’t feel guilty about not using your car as much as you’d hoped. You’ll also have the option to get a truck or bigger vehicle if you need it once in a while.
I used Flexcar when I first moved to the city - the two companies have merged. I lived in a neighborhood where there were usually plenty of cars available and I liked the flexibility without having to worry about maintenance, gas, or car insurance.
Yeah there is one in my city. I just did some comparisons and found that a 3 day trip where I travel 300km would only cost me ~$200 including gas.
That would be roughly $600-$800 a month if I used it every weekend. However just owning a car I'm not using at all would be $200 a month at least in parking and insurance, plus probably $150-$200 in gas.
So the car sharing service is 1.5x to 2x as expensive to use, but has no maintenance or upfront cost. I think that is a pretty fair deal and it would be a good experiment for at least the first year. If I end up using it consistently, then I can consider getting a car afterwards. Thank you for your advice!
I wish I could retire this early, so don't give in too soon. At 3-5k annual cost, there are some other options depending on where you live.
Rental
I've had good experiences with rental companies. When I didn't have a car, I'd sometimes rent one for a weekend. This was in the Boston area, so there were plenty of rental companies to choose from. They all had some form of weekend deal. Prices were reasonable, something like $100 for a weekend.
Car sharing
In essence not very different from a rental company. In Boston I also used Zipcar. It came at a monthly fee, which also counted towards car rental. If something like this is available in your area, it might fit your needs. For me, it wasn't cheaper than a regular rental. This is why I used both at that time. I love the idea though: sharing a car makes a lot of sense.
Car sharing DIY
My parents and sister (with her family) are living in the same city. Neither family requires the car on a daily basis, so they've figured out a way to share the car between them. They have a shared calendar and split the costs. To make it even cooler: they have a shared bike too to get to the car! You take the bike to the other person's home and take the car, when you're done with the car you park it in front of your own home. Next time the other person wants the car, they have the shared bike to get it from your home. They've been doing this for the last 5 years and are happy with it.
It sounds like you know a lot of people. There might be some interested in this experiment. It does require easy going people, willing to make some sacrifices. Buy a Camry from the 2000s and figure out insurance.
Alternatively, you could lease a vehicle for 2 or 3 years. Several states have some impressive ev lease help (if youre interested in an EV) and leases are cheaper than buying outright (or loan). It's like a long term rental.
Shop around, test drive, etc.
All that being said, if youve gone this long without needing one, I'd probably not. Also the extra cost (license, insurance, registration, and upkeep) varies a fair amount from state to state and person to person even.
Also in the US, people who don’t qualify for EV incentives when purchasing do qualify when leasing, and while some cars that aren’t majority sourced/built in North America don’t qualify, some manufacturers have put forward their own incentives to take the place of federal/state incentives in order to be competitive.
Leasehackr is a good resource for finding good lease deals and lease brokers in the various regions of the US.
They also have pre-negotiated deals that you just click a button to take advantage of, for example right now they have a top trim Nissan Leaf available for Colorado residents for $0 down, $109/month for 24 months. That comes out to $2,616 total spent which is incredible for driving a brand new car for two years and not having to think about repairs or gas costs.
I was going to say this. Definitely test the waters before buying anything! Leasing gets a bad rap but as far as I'm aware from the people I know, the pricing is really quite competitive compared to outright buying.
I don't know about your location but around here you can lease cars anywhere from 6 months at a time to signing on for years at a time.
I believe there is a little asterisk there, although I can only speak for leasing in my country. This is mostly true when comparing leasing to buying a brand-new car.
Testing the waters is still a good idea. For which a second hand car might also be a good choice as it will not deprecate in value nearly as much as a newly bought car would and will be cheaper initially either.
Which do you want to prioritize?
Retiring incredibly early, or dating and maybe ending up with a life partner?
You may not be able to achieve both.
I don't know 100% if I want a life partner as I don't have much relationship experience, but I do want to spend time dating to find out, and meeting more people through one of my favourite activities is the best way I know how to.
So for now I do want prioritise dating, and spending money on things like this is going to be a part of that! Thank you.
OK, so because you are FIRE and are frugal, you are putting limits on
I can't give you advice. That is your decision.
I can say that some of the most interesting people I ever met spend their weekends driving out to somewhere in the middle of nowhere to party or hike or kayak or mountain bike or ski or simply camp out with someone cool. Some of the best (and some of the worst) experiences I ever had was with those people.
The downsides are there are a lot of hidden costs in buying or renting a car.
You can minimize total cost of ownership by buying a three year old corolla or civic, hold it for the long term, but you need negotiate hard for a good price against folks way more experienced than you, and you need to be careful to not buy a lemon. You could buy a ten year old car but you need to figure out a way to maintain it yourself, or find a mechanic you trust, or deal with the potential break downs in the middle of nowhere.
The biggest hidden cost is insurance. And you aren't factoring it into the price of rentals. The rental guys lure you in with a cheap price, and then ask if you want to be liable for a $25k car if it is stolen or damaged. Now you are paying $120 instead of $60. Because you don't have car insurance. Your credit card may provide some coverage, but it doesn't cover everything, and in general all companies make their money by finding reasons not to pay out cash. Not sure how zipcar works.
I've driven without full insurance, which was fine, until I found myself trying to get cash out of another persons insurance company. My insurance company is fantastic, but once they determined it was between me and the other guys insurance company, they were no longer involved, and I no longer drove without full insurance.
Also, you are liable for medical. Even with full insurance, there are limits to medical. Higher limits mean higher premiums. If you have significant assets you want to protect, you now need umbrella insurance.
The biggest long term cost, is you might find yourself wanting a car into retirement. Now you have to budget for more money when you retire, and you are saving less money now, because you also want a car now.
The biggest unknown cost is that a car is a gateway drug. You might find yourself happily partnered with house and kids and no money.
Lastly, there is the cost of buying the wrong car. Sales tax isn't cheap. Getting a good price for a used car is extremely hard. If you buy a civic, but then decide you want a van for camping, that will cost you.
All that said, I suggest you stop worrying about it, rent a car for a full weekend, pay for the full coverage, plan go someplace fun, and plan to invite others along. And then let us all know how it goes. Because you have walls of written advice here.
I'm actually on the other side of this where I'd like to live close to work and just sell my car to drop the extra cost and baggage.
If I could manage to simply cut the costs by just owning my vehicle outright and going for absolutely minimal insurance I'd be cool with keeping it - unfortunately I don't have that freedom in my budget, and while I need it for work I can't justify cuts. That's honestly the biggest thing for me - I like the freedom it provides, I just hate the cost.
That being said, if you can find a cheaper but reliable vehicle that's probably a valid expense if you have space for it.
I say go for it! But more importantly if you can afford it, stop putting off joy for later if you can experience it now. Early retirement sounds nice and all, but I have had the unfortunate experience of knowing several people who unfortunately passed away in their 50s and early 60s. It's really lit a spark under my own butt to get healthier (which you already seem to have well covered!), but also to make sure I'm enjoying life now and not slave away too hard for the sake of an uncertain future state.
Obviously, it's good to make sure you are spending your money within reason, but it's important to live while you can.
"I fill up my free time with low cost activities like magic (the gathering)"
Made me smile :D thanks
My read on it is that you mostly want a car for occasional use. The use cases you've described aren't daily activities, so if you owned a car you'd either start to drive a lot more or it would sit unused most days. Both of these seem like poor outcomes.
My friends group is mostly car free, and so when we do a hike or camping trip we'll rent a giant vehicle with four wheel drive that's suited for the specific thing we're planning on doing rather than trying to pack everything into a vehicle intended for city driving. I'd break your use cases down into individual scenarios. What vehicle is best to get you alone to a local trail to do a practice run? What vehicle is best for hauling a group of people to the mountains for a hike? What vehicle is best for giving you flexibility when you visit family?
A lot of these answers will depend on your specific situation. Are there easy short term vehicle rentals in your city? How much does it cost to rent a big SUV for a day? Is cycling to the local trails for your run feasible? Can you borrow a family vehicle when you visit?
For us, we've decided that the cost and complexity of owning a vehicle isn't sensible when it would sit in our driveway 95% of the time. Maybe that's the choice you'll make, maybe not, but I think that breaking it down into individual use cases will help you decide if owning a car is a good solution to fit your varied needs.
One of my favorite car channels sometimes shows off cars that they feature by using them to ferry hikers on their segment of the Appalachian Trail. A car might open up some social opportunities to you, if it helps you look at it past the economic side.
I'm pro-car (much to my own shock here!). PantsEnvy beat me to it, but it sounds like your basic reasons are:
So much can change with the social aspect. Even if you don't find a partner, what if you find an amazing friend who moves to a different state? (Where I live, it's common for people to leave in their 30s for cheaper places-- I'd be interested in moving where my friends do.)
It really does depend on why you want to FIRE, your general ability to push it back, and whether you can (ideally) find a regular car to rent. But, if you did get a car, I imagine your lifestyle could change too. So instead of hiking occasionally, you can do it weekly, or get a further out apartment. Plus, to my understanding (as someone who's never owned a car), it's a decent resale market for cars, right? So you're not stuck with it.
For me, this decision was changing to a bigger apartment (from the smaller, cheaper apartment I was in-- think a very small studio). Part of my reasoning was just not feeling confident in that apartment (along with practical reasons like lack of light and space). It did make a big difference for FIRE, but also did make a big difference in my confidence level when dating, and I think I wouldn't be with my partner today if I hadn't gotten over it (so therapy might have worked, but getting an apartment helped with more certainty). On the other side of things, my lifestyle also changed more. I don't pay for late night taxis going home anymore (mixture of less going out and walking distance to new things). I always cooked in my old apartment (which had a smaller kitchen), but it now feels less like "I'm saving money" and more "I'm cooking in my cool apartment." So perhaps it'll also change your general lifestyle and change the opportunity cost.
You never mentioned if you have a place to park or store a vehicle. I also don’t know what your weather is like (colder climates can be rougher on parked vehicles if there’s a lot of snow/salt). Those factors would influence my decision, personally.
Anyway, I know cars can be black holes for money, but also I see cars as long-term “opportunity” investments. Keep in mind, I live somewhere more rural, so cars are basically necessary. Still, when I buy a car (which is rare), I keep them for a long time because I drive them sparingly (I also WFH, I try to find alternative means of transportation, etc.). This is intentional so I can preserve the life of the car.
I’ve had one car for nearly ten years now. There’s a good chance I’ll have it another ten. Sure, I’ve incurred costs. But I prioritize reliable models over flashy, etc. I paid a reasonable price for that car, paid it off in three years, and have spent the remaining seven years mostly paying for gas, insurance, and occasional maintenance.
So, I’d consider doing the math long-term. Do you think you’d be able to find a car and it keep it for 10-20 years? What would the impact to your retirement be if you put away a consistent amount each check that could cover all inevitable costs?
I kinda look at a car as "how much per year" but I would also consider "how much per kilometer/mile" in your case. Have a look at it that way. If you spend considerable money on buying a car, try and predict how long it will last and how many kilometers/miles you think you will do in its lifetime. Then it's as simple as looking at price for a mile and considering if you are ok with it. You have to include running cost and also service and insurance for the vehicle in this calculation.
Also - having a car will likely make you a bit lazy, you will drive where you used to bike etc.
We have two cars in family. One is new that will probably never repay itself in its lifetime (as it will hardly run 30 yeara from now) and the other one is used and if it runs for next 5 years, I'm ok with the money we spent on it and will hapilly buy another one like that. The used one will probably last more than 5 years, I reckon 10, at which time it would become excellent buy!
Personally speaking, I wouldn't own a car if I didn't need it. They are a cost sink in ways that are not entirely obvious - especially in time. EVs don't have a ton of mechanical maintenance but you still have to spend time regularly filling the tires with air and cleaning it. And of course you will have to spend more on license, registration, and insurance regularly. But it sounds like those would not be a big deal to you; you mentioned it already.
My general recommendation is to not spend money on things but to spend it on experiences. The most miserable people I know are the people who try to buy their way into the "instagram lifestyle". But the stuff you buy is only going to make you happy so long as it stays novel, and that novelty wears off quickly. On the other hand, buying a ticket for a concert or a convention is a memory that will bring you pleasure for the rest of your life. That's where buying a car can be complicated. My personal opinion is that owning a car doesn't actually enable most of those experiences insomuch as they alter them slightly. That doesn't mean the convenience factor isn't important, though. Maybe consider getting a license and then just renting?
I can’t tell you if a car is right for you or not, but I wanted to touch on the lifestyle creep and yearly costs you point out. That’s accurate if you buy something relatively new. However, you can pretty safely buy a $5000-$10000 Honda CR-V or something (2nd gen, ideally) and it’s going to be reliable as hell. If you buy with cash, you won’t have a loan, and even if you take out a loan, that’s a lot cheaper than if you buy something relatively new. Working on those is cheap and if you’re willing to learn to do your own oil changes and brake service, it’s even cheaper, but even without learning that, it’s one of the cheapest cars you can own.
I think assuming a car will cost you $3k-$5k yearly is a very high estimate considering you don’t need to buy a newer car. Of course insurance and gas are variables, but as a car person I just wanted to let you know it’s perfectly fine to get a 20 year old car. Something like the CR-V I mentioned can easily go to 300k miles (of course there are other makes/models, I just love Honda). Hit me up if you ever have car related questions, almost everything I drive is 20+ years old and despite owning three cars right now, my yearly costs are well below people who have a single newer car.
I dont see a car as an expense. Its a 'freedom machine'.
Want to visit a friend who lives 100 miles away? Make the decision and be on the road 5 minutes later. Sure, you can rent a car, but that destroys spontaneity right there. Spontaneous trips spark joy and life is about finding as much joy as you can.
All the reasons you gave for wanting a car seem to be for sporadic events. You can just rent a car for those. Cars are also way more expensive than you would expect when purchasing your first one. Make sure you fully take into account costs of insurance, maintenance, parking, etc...
Are there any car sharing services around where you are? They are quite ubiquitous around here and allow people without a car to easily and for a reasonable cost (cheaper than rentals) get a car whenever they need one.
Admittedly we now have a car. But before we had one we used a car sharing program. They have various cars parked nearby and one was always available.
Edit: sorry, should have read your post better. While car sharing programs are pretty neat, they are still expensive when used for prolonged periods like the example of visiting family for several weeks.
Visiting family more often was just an example if I owned a car outright, and I can still visit them by bus.
I posted my thoughts on car sharing at https://tildes.net/~life/1ihi/help_on_deciding_whether_to_stay_with_a_low_cost_simple_life_or_to_live_life_to_the_fullest#comment-djbk and I think that is what I am currently leaning towards for at least the first year to test the waters!
Depends on how much use you'll get out of it. I think you did a good job listing all the reason how you will use that car.
I agree with another poster that leasing or rental might be more attractive option since it allows you try out for set amount of time. Better if you can split the car use and cost with a family member or a roommate that you trust. Another tip is you can try to simulate car payment every month and see if justifies the cost of the car.
Personally, I asked the question, will my husband and I use the car more than 7 days out of a month? And the answer ended up being yes for us. However the answer might look different to you espicially since your single.
IMHO, if I were in your shoes, I actually wouldn't get a car. Only worked for us because my husband and I took turn parking or used the car separately. Being solely responsible for a car is kinda a pain between the maintenance, cost, and parking.