Job Free Wannabe

NorthernMonkey1

Well, the first spanner was thrown in the works today. A call from the garage to say the car isn't just unwell, it's terminal. There is a lot of metal in the oil, and it's either a new engine, or scrapping.

Its on 06 plate VW polo, and its only got 77k on the clock. I expected a lot more from a VW. I also just put 4 new goodyear tyres on it last month expecting it to last a fair while.

I now have to pick from 2 options. Do I either splash out £9000 on a Nissan Leaf, or look for another sub £1000 car on Facebook marketplace/gumtree. A leaf would save me £90 a month in petrol, but cost about £160 a month over 5 years.

Zola.

Nice thread.

Cheap run around all the way. I have a 2002 VW with 246,000 miles on the clock!

MallyGirl

There are a few 'early retirement' type discussion threads in the pensions section these days. I am certainly another Job free wannabe and am putting 50% of my salary plus the employer 10% into my pension via salary sacrifice at the moment to make that more viable. I wish I had started earlier as I wouldn't have to be so aggressive now but hey ho! I am 52, was aiming for 60 but am now hoping for 58. This is with a decent enough amount accrued to be able to do some serious travelling in the early years of retirement.

NorthernMonkey1

60% is a really awesome amount to be paying in. I always like to think that instead of buying crap, I'm buying days of freedom. £1250 a month is about £41 a day. For every £41 I don't spend, and manage to invest, I've bought myself another days freedom.

I find it really easy to not buy crap when I think of stuff in terms of how many days freedom is that worth.

I signed up for a Monzo account on monday to help me track my money. Someone at work sent me a referral link for a fiver, and as the card turned up today. I then transferred £200 in and enabled the card on my apple watch so I can use this for all my spending, and track accurately where all my money goes.

katsu

On the car, how much do you normally spend on garage bills in a year? How long do you expect a £1k car to last?

The Nissan Leaf will also have cheaper road tax as well as savings on petrol - I have no idea how the insurance costs compare?

NorthernMonkey1

I've done pretty well out of 'bangernomics' for the lest 10 years.

I'll probably go to the bank to borrow the 9k (9k over 5 years at 3.3% from HSBC) even though there is significantly more than that in the ISA. Having the money in the ISA as my 'what happens if i get sacked or something bad' happens helps me sleep, and the returns on a S&S isa are likely to be >3.3% anyway, so this makes sense.

In the past I've been pretty bad with money, and getting into more debt gives me the heebejeebies, after the battle I had to get out of debt years ago. It's a head vs heart thing. My head is saying this is a sensible, frugal thing to do, my gut is screaming 'debt? - are you insane'

SuperSecretSquirrel

Just stumbled across your new thread NM - nice to see another early retirement thread pop up You should post a link to this on your old thread - bring any subscribers over for part two of the journey!

Your plan looks great, just wish I had a 60k+ salary so I could match your pace!

On the subject of cars and borrowing, I'd not feel comfortable without a cash emergency fund held separately from the S&S ISA. Something to cover a car replacement, boiler replacement, a few months off work - the expected unexpecteds if you will. Saves having to cash in S&S at a low point. I suppose uninvested money comes at a cost too though, so horses for courses really.

In your situation I'd consider getting one last banger, and saving cash to buy a leaf before the banger goes bang. If that doesn't appeal, 3.3% doesn't seem too heavy a price to pay. What's the deal with the leaf? How old is it, is the real world range sufficient, what's the battery situation (leased or owned), what happens when battery capacity drops, what's the servicing situation (nissan only or are local independents equipped to handle it), etc?

NorthernMonkey1

Hey SSS.

I know we disagree on the cash fund aspect of savings. I don't have any cash at all. I've got £1500 overdraft available, and a CC with £10k limit. Between the two that should deal with any emergencies. I can get money out of the ISA to then re-pay those if it's a bigger bill.

Having enough cash to buy a new car just say about seems a bit wasteful. At a 5% gain, its £500 a year opportunity cost to have £10k sat in cash holdings.

The £60k job is nice in some ways, but I often feel promoted beyond my abilities. It's really stressful, and my anxiety about being 'found out' was the cause of my initial mortgage free drive, and now my second drive to make sure if I do lose my job, I've got a financial cushion.

NorthernMonkey1

The car that I was going to look at has now been sold. There aren't a huge number available within 60 or so miles of where I live, and I'm also getting ridiculously stressed about spending that much money.

Before joining this board, I had a big battle to become debt free, and the thought of launching myself into debt just for a car makes me really uncomfortable. I don't want to take the money out of my ISA, as I see this as my cushion incase anything happens in my work, and as I said before, my job is something I worry about quite a lot.

Maybe I should just get myself another banger.

NorthernMonkey1

After talking to Mrs NM, she has convinced me that I probably shouldn't be driving car in rubbishy old cars. I've splashed out £12,000 on a Nissan Leaf. It's magic compared to the rubbish I've driven in the past, and I'm convinced electric is the future. I can charge it at work, so with a little bit of planning, my electricity bill wont increase too much, but I can save £80 - £100 a month in fuel and £15 a month in car tax.

Its been paid for by a £11700 loan over 60 months at 3.3% That means that most of the £211 loan repayment is off-set with savings. I guess I need to hand in my debt-free badge now

The plan is to keep the loan for the full term, not diverting any S&S Isa payments into the loan, as expect the isa return to be >3.3%

I've done a quick tot up of account balances as of this morning, to keep track of where I am on my JobFreeWanabee Journey

Car Loan -12694.53
HL ISA 55154.33
Vanguard ISA 1264.04
Pension 206163.40

Total 249887.44