Major Purchase Now?

[JoeWras]

What about buying a vehicle in the next few months? Good deals ahead?

 

[Ready]

What about buying a vehicle in the next few months? Good deals ahead?

Good question. Most US manufacturers just shut down their plants today. Tesla is operating at 25% capacity for now. So while people are likely postponing buying new cars, supply may dry up if the factories stay shut down for an extended period of time.

 

[JoeWras]

Good question. Most US manufacturers just shut down their plants today. Tesla is operating at 25% capacity for now. So while people are likely postponing buying new cars, supply may dry up if the factories stay shut down for an extended period of time.

Yeah, I guess this is uncharted. My dad always talks about the craziness of car buying after WWII. But that was complex, and required new training of workers, and retooling.

 

[pb4uski]

I'll have to pay half the balance when they break ground and the rest when they finish. ....

I would definitely renegotiate the payment terms so that your money out is never very much ahead of the work. Too many homeowners have been burnt with 50% deposits.

I built a house in 2010-11 and a two-car garage with loft in 2013. On the house the contractor gave me a bill for his materials and time and I paid him within 10 days.... long before his bill for the materials was due to the lumber company. Ditto on the garage other than I did concede to paying for custom trusses in advance.

We recently had new flooring installed and the vendor wanted a 50% deposit when we agreed to terms and the other 50% on completion... stock flooring... I refused.. told him that I would do a 15% good faith deposit and the rest upon completion of the 2-day job. He decided that was fair.

 

[Jerry1]

Yeah, I’m going to have to do something. I sure don’t want to get stuck with having to try to find someone to complete the job if this guy can’t. Finding a concrete guy is hard enough. Finding one that knows how to deal with a pool would likely be next to impossible.

 

[copyright1997reloaded]

Good question. Most US manufacturers just shut down their plants today. Tesla is operating at 25% capacity for now. So while people are likely postponing buying new cars, supply may dry up if the factories stay shut down for an extended period of time.

There are plenty of cars on the lots and sales have fallen off the cliff. (I can't find where I saw the actual numbers, but it was a big drop off in the last week.)

 

[Ready]

There are plenty of cars on the lots and sales have fallen off the cliff. (I can't find where I saw the actual numbers, but it was a big drop off in the last week.)

I’m not in the market so I have not been following the data. But I do keep a close eye on the Tesla community. There is a huge backlog of orders and Tesla just announced a 75% reduction in production capacity and people are freaking out about when they are going to be able to get their cars. But Tesla is a niche product with virtually no competition so you can’t compare it to the Toyota/Honda/Ford world.

Only time will tell how this all plays out. The longer we are on lock down as a country the less need there will be for cars since nobody will have anywhere to go beyond their local grocery store.

 

[RobbieB]

I'm thinking seriously about postponing the landscape job. I'm liable for the plan (another $800) but the 40 grand for the work can wait me thinks.

 

[Running_Man]

I'm close to 50/50. For people who read that and say "hey Jerry, you said you were at 60/40", that's true for my main brokerage account but my overall is closer to 50/50. I think the reality is if the market goes down another 10%, I'll be going from the comfortable, no worries about money retirement to the I need to be careful retirement. Another 10% and I'll have to tighten my belt. That doesn't change too much if I get the pool because I'm financing it and with the financing, staying within my original retirement budget. It's the lack of cushion that's getting me nervous.

get the pool then you’ll enjoy it and I can tell you want it, it’s worth far more than what you can be charged

 

[BarbWire]

So much here is couched in terms of the financials: good investment, can you get a lower price if you wait or negotiate or ....

Not all investments are financial. If you can afford this, and if it would make you happy, then make the investment in yourself.

As long as you aren't doing something self-destructive, then remember WHY we worked so hard for our assets.

"Invest in yourself" and "invest in your happiness" are things I frequently have to remind myself of....

 

[REWahoo]

I'm thinking seriously about postponing the landscape job. I'm liable for the plan (another $800) but the 40 grand for the work can wait me thinks.

Hey, "Blow that dough!"

 

[RobbieB]

Already down a half mil. Not worried, but would like to conserve cash during the low.

Blow dough when the sun shines and the iron's hot!

 

[Running_Man]

So much here is couched in terms of the financials: good investment, can you get a lower price if you wait or negotiate or ....

Not all investments are financial. If you can afford this, and if it would make you happy, then make the investment in yourself.

As long as you aren't doing something self-destructive, then remember WHY we worked so hard for our assets.

"Invest in yourself" and "invest in your happiness" are things I frequently have to remind myself of....

Barb makes a sharp point I like it,I think snagged the best idea!

 

[RenoJay]

I would delay. It’s not clear yet if the current financial storm is going to affect new home construction, but if it does, there’ll be a lot of hungry laborers willing to work for much less than they were a month ago. I did a full kitchen remodel in 2011 for like $15k. I had a general contractor who did great work (but who had a lousy personality) working for $25/hour. Most of the cost was cabinets, flooring, appliances and counter tops. I’d hold off on the pool.

 

[RxMan]

My wife and I were really close to buying an RV a couple of times in the past month and a half. Things just didn’t work out both times and it would have been $50000-$75000 depending on which RV we would have bought. One the financing fell through and the other we decided was too much money.

We’ve both said how thankful we are that we didn’t buy an RV. It wouldn’t have been great timing. As others have said about the pool I’m wondering if there will be better deals in a couple of months. Either way I’m thankful we are debt free and I’m thankful that I’m able to work remotely from home so my job hasn’t been disrupted.

If you have the money and it’s something you’ve wanted then go for it. I’m personally thankful I don’t have a lot of new debt right now even though the cost of borrowing money is pretty low currently.

 

[Katsmeow]

I think I’d be fine as long as things stabilize. I could even probably deal with the market going down another 20% before I’d have to think in terms of tightening my belt of taking SS a little earlier than planned. But of course, this current situation make one pause. So, how to evaluate going forward?

Note, I’d probably lose about $8K if I cancel. But of course that’s a lot less than making a $100K mistake.

I'll have to pay half the balance when they break ground and the rest when they finish.

I would definitely cancel. FWIW, we just completed a major home remodel and were planning to spend several thousand dollars for window coverings and new furniture/TVs. All of that is on hold now for us. We will just wait.

Your situation is more complex. If I was you I would ask for a delay without having to pay the $8000.

The part about things stabilizing...do you mean financially or with Covid-19? I don't know where you live but honestly I don't see this really stabilizing for months. I am actually astonished that anyone is able to do that kind of work right now. Most stuff like that is being cancelled or delayed either by governmental action or because the businesses can't ensure personnel.

Leaving aside whether they come in your house that crew is going to be hazardous to each other. One person gets sick and they likely give it to others in the crew. You really have a huge risk that you pay 50% of the total amount and the company can't complete the work.

I would personally not want to have a lot of people on my property right now at all. But even if that didn't bother me there is absolutely no reason for you to think that when this project starts they will be able to actually complete the work.

 

[eytonxav]

If you don't think you'll need the money, and considering you already made a down payment, I would go for it.

 

[Jerry1]

there is absolutely no reason for you to think that when this project starts they will be able to actually complete the work.

Thanks to everyone for their comments. This conversation has taken my concern from being financial to whether or not the job will be completed. My desire is to go forward. I want the pool, I’m in good shape so far financially and I’m not too keen on giving up my $8K deposit. However, as the job progresses I will be evaluating my financial situation before the next step (finalizing the permits) and actually breaking ground. I do think I will need a different contract to go forward in order to ensure completion. Of course I will also be evaluating the COVID19 situation and how people working on my property might effect me and DW health wise.

 

[Katsmeow]

However, as the job progresses I will be evaluating my financial situation before the next step (finalizing the permits) and actually breaking ground. I do think I will need a different contract to go forward in order to ensure completion.

Also consider what will happen if the job is shut down by governmental action (as a non-essential business for example). Given the amount of money at risk in the project you might want to run the contract by an attorney competent in that area of law in your state so that you are adequately protected.

 

[foxfirev5]

Already down a half mil. Not worried, but would like to conserve cash during the low.

Blow dough when the sun shines and the iron's hot!

Just curious what does your FA guy say?

 

[Jerry1]

Just curious what does your FA guy say?

I gave him some worse case numbers to run and will hear back from him on Monday. I'm sure that the thing that we'll need is the thing no one has - the answer to how bad this will get. If it stopped now and things stabilized, it will be fine. A little more - okay. More than that - it would be better to keep the money in house. He'll set up some breakpoints and we'll discuss.

I also e-mailed the contractor today asking him to confirm what would happen if I cancel and what the possibility is of deferring the work, maybe even putting it off until next year.

 

[DrRoy]

We are in the midst of three projects, so could not stop new. Fortunately, I raised the cash to pay for it all in Dec. The total was 1.1% of NW then, maybe 1.4% now.

 

[SeattleRocks]

Boy the car dealers are really in a tough position. I was thinking of buying a new car (Audi) literally the day the market dropped it's first 1000pts. I was negotiating pricing but eventually backed away and held off.

Well, both the sales person plus the general manager both reached out to me this week and basically said their business is falling apart and that they just want to move inventory and will accept pretty much any deal.

Their emails were desperate. Now it could have been sales people being sales people, but I read today that cars are going to do 1.4M sales less this year because of the crash. So perhaps they are desperate.

Well, I still need a new car so I may actually take advantage of this fire sale if they are really serious about just trying to get inventory off their lots. Still thinking it through

But if you are in the market for a car, I would guess all dealers are hurting badly and its a buyers market.

 

[Ready]

Boy the car dealers are really in a tough position. I was thinking of buying a new car (Audi) literally the day the market dropped it's first 1000pts. I was negotiating pricing but eventually backed away and held off.

Well, both the sales person plus the general manager both reached out to me this week and basically said their business is falling apart and that they just want to move inventory and will accept pretty much any deal.

Their emails were desperate. Now it could have been sales people being sales people, but I read today that cars are going to do 1.4M sales less this year because of the crash. So perhaps they are desperate.

Well, I still need a new car so I may actually take advantage of this fire sale if they are really serious about just trying to get inventory off their lots. Still thinking it through

But if you are in the market for a car, I would guess all dealers are hurting badly and its a buyers market.

How do you plan to determine what price constitutes a fire sale?

 

[COcheesehead]

We bought a lot. Engaged with a builder we finally trust. We got what amounts to the lowest cost construction loan in recent times.
If the markets fall another 20%-and it could- we still have 34 times our planned retirement expenses.
We are moving forward. This too shall pass.