Aside from the interesting New Zealand accent (only a hop, step and a jump away from my own Aussie accent) – and, the fact that the Porsche Cayenne costs NZ$260k (or a little over USD$189,000) making them ridiculously expensive in the Land Of The Long White Cloud – I think this video is misnamed.
So you forgo the car and invest the money (as you probably should, while you are trying to work towards your Number) and get back $1.8 million after 20 years … what do you do then?
Well, isn’t the Real Value of Money based for spending? Am I missing something here?!
What you spend it on is up to you: you could give it all away or you could go out and buy yourself a Porsche Cayenne.
And, if you’re going to buy a Porsche Cayenne then, why not buy it now (if you have reached your Number and/or can afford it within the 5% Spending Rule)? 😉
Still, the message is clear: don’t go out and waste your money on ‘stuff’ if you are still trying to work towards your Number!
When you reach your number will the things that you forfeit still have the same value?
@ Ill Liquidity – No; I’d value a Ferrari (even a Maserati) much more than a Porsche nowadays 🙂
“Well, isn’t the Real Value of Money based for spending? Am I missing something here?!”
With respect, I’m not sure if I can agree with this. The “real value” of money is not the spending but the knowledge that you have the money to spend should you chose to do so – in other words the real value of money is the security and freedon that having (enough of) it can provide.
“Still, the message is clear: don’t go out and waste your money on ‘stuff’ if you are still trying to work towards your Number!”
Absolutely – but you need to be careful with statements like this. People who don’t read your blog as often as I do mught think you are advocating a “save your way to retirement” approach to personal finance and end up confusing you with Suzie Orman. 🙂
@ Trainee – … until they see a side by side photo. Suzie scares me … on SO many levels 🙂
But – at least, according to my personal philosophy – we build up our funds until we reach our Number. Why did we choose that Number? To allow us the required SPENDING level to live our Life’s Purpose.
But, on the way, it’s nice to spend a little, too. Even if it does cost us $1.79 million for a car 😉
Did you notice that he had car loans at 9.5% and it seemed that you could get guaranteed 5.5% return on some investment accounts.
Were they similar to cash? Have people tried to open similar accounts in other countries (with some hedging for exchange rates I would expect). In the US any parked money returns virtually nothing.
(who is enjoying a new car, but still obeying the 5% rule).
@ Neil – Guilt-free enjoyment of ‘stuff’ …. aaahhh!
Just another side benefit of the 7million7years Way 😉