Money Mom Podcast

43: Big Purchases: Behind the Scenes

• Rachel Coons • Season 1 • Episode 43

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In this episode of Money mom, I'm taking you behind the scenes of one of the biggest financial decisions many of us make—buying a car. We'll talk about how we decided it was time to make the purchase, how we chose which vehicle to buy, and the conversations my husband and I had when our car-buying priorities weren't the same. Tune in for real talk about one of life's most significant purchases!

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Rachel

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Speaker 1:

Hey there, welcome back to another episode of the Money Mom Podcast. It's me Rachel, and today's episode I have been meaning to record for weeks and weeks because it was something that was kind of a hot topic when I shared about it on my Instagram and I had a lot of really cool conversations with people in my DMs and I thought it might be a good idea for me to come on the podcast and record an episode that dissects the way I think we should go about making big financial decisions. At some point or another in your life, you will have to make a big financial decision of buying something or investing money in something and so giving you tools to be able to make that decision. I think, from a place of power and intentional spending can make all the difference when it comes to stress and tension between two people in a partnership and how you go about making financial decisions. And because I recently experienced this and went through this process, I wanted to come on here and share my experience with Brad and I and how we made a big financial decision, and then talk about some ways that you then can go do this as well and feel peace and empowerment in these decisions. So, sharing a little bit about our experience. We have always Brad and I have always been very frugal with our money and not to say that we're always about restricting spending money but we are very careful about when we purchase things that are not necessary and how we go about making that decision For the longest time, brad and I got married when we were in college, in our undergraduate career, and so we didn't have any money when we got married and we really didn't have a steady income until we got through graduate school.

Speaker 1:

Brad went to dental school and that was really expensive, and so we didn't have a lot of money coming in, just like odds and end things that I was doing on the side, but I was also having children, and so we didn't make a steady income until 2018. That was just seven years ago that we finally made money in our marriage, and so for the longest time, we were always about getting the best deal, making the best financial decision for our future and really being careful about how our money left our bank account. So that's where our marriage started and, as we have been able to increase our income and taking care of the basic needs of life that you have to take care of, like the bills, the rent, electricity, the food, all of those types of things. As we've been able to have a little bit more money to buy things that are more of a want and not a need, we've come into a new problem, I would say, in our marriages how do we go about making these decisions that might not be necessary? There's a lot of guilt that can come with purchasing these other items that are not necessary, but still we want them, and we've worked hard to create a financial situation where we can purchase them. So that's where we're at, and we've been really trying to be very careful about coming into this situation, because you all have probably heard of lifestyle creep, and that's a very real thing that as people start to make more money, their lifestyle starts to get more expensive as well, because they're purchasing things that are not necessary but then force them to continue to make more money because they're not being careful with the money they are making, and lifestyle creep can happen very fast, and it can also happen really gradually, and so there's nothing wrong with increasing the want things that you buy, but being really intentional about stepping into that and making sure that you have the financial backing for all of these decisions so that you don't get into debt, even with a solid income. I see that so often with people who make a really good income and still don't have any extra money or they're going into debt. It's because they have stepped into that lifestyle creep. So we've been really intentional about when we purchase things. Do we actually have the money to do it and is it going to stretch us financially or can we afford the payments? Can we afford the big chunk of cash to purchase those things? Anyways, that's a long backstory for what happened recently.

Speaker 1:

Last year, we had started talking about purchasing a new car for our family. Brad and I purchased our two cars that we have back in 2018. When we finally had an income, we were able to get not new cars, but they were new to us. They were older cars. We bought a van because we had three children and I couldn't fit all three kids in my teeny SUV anymore, and we bought him a car so that he could commute to and from work. And we bought those vehicles for very affordable prices because they were old cars. Both the cars were 2010 and 2011 year and we bought them in 2018. So not new at all and both of them were under $20,000. We paid cash for them, we saved up for them and we kind of just decided that we would probably run these vehicles into the ground.

Speaker 1:

Well, fast forward, seven years later and our van had about 180,000 miles on it and was starting to have a lot of problems, and you know what I'm talking about. If you have a vehicle that is older and pushing high mileage, things start breaking. You have to start doing repairs, and that's been the case with our. It's a Toyota Sienna. That's been the case with that car for a long time. We put quite a bit of money to keep it going, but it was just, you know, a thousand dollars here, a thousand dollars there. It wasn't crazy expensive and the cost of having to purchase a new car was way more. So we thought we'd just continue paying to keep up this car running.

Speaker 1:

So last year, when we ended up putting a lot of money in this car over $6,000 we put into this car in one calendar year Brad approached me and said hey, I think wewheel drive be able to tow those types of things. We live close to the snow and we head up to the snow quite often and Brad doesn't like that the Toyota doesn't have four-wheel drive. So, anyway, there's just all these things that we were like maybe it's time to start thinking about it. Well, my personality, like I said before, is like no, no, no. You don't purchase expensive things if you don't have the cash up front. It's very much a want. We didn't need a new car. We had a car that was working and it just felt a little bit like that was stepping out of what felt good to me financially.

Speaker 1:

So this was like July of last year and Brad continued to say say hey, like we're both doing well with our businesses. We're both, like, feeling good financially. We've invested, you know, all of the money that we want to invest every single year. We've hit that 20 percent and more, and like we're hitting all of these financial goals. Like maybe it's time for you to start thinking about treating yourself to this new car, this, maybe it's time for you to start thinking about treating yourself to this new car. This would be something fun for you.

Speaker 1:

And I just kept saying no, no, no, no, no, like it doesn't I feel guilty about buying myself a new car. I feel guilty because I have a car that works, and it wasn't until I actually sat down with my accountant in December and we had some, you know, talks about taxes and things like that, and he brought up this idea. He was like hey, have you thought about purchasing a new car before the end of the year so we can significantly decrease your taxable income in 2024? And you know, it wasn't until my accountant said something to me that I actually kind of was like, oh, maybe that's something I should think about. So I got off the call and talked to Brad and I was like, hey, brad, my accountant also thinks that maybe we should purchase a car. And you know, brad's eyes light up and he's like I've been telling you this for months, we should be doing this. And so I said, ok, brad, go research, go think about you know what kind of car we would get. You know, start getting the numbers on how much it would cost us and you know how much could we sell our current car for and all of the things, cause I just wanted to make an informed decision. And so that was a couple of weeks worth of him. He went and test, drove cars. You know he's he's a really. He really likes to research things and dissect the purchase and crunch the numbers and all that stuff, whereas I am more of like just tell me what car we're gonna get, I'll drive it, make sure I like it and then we'll make it happen. Um, so he did that.

Speaker 1:

And you guys? Car prices in 2025 are insane. This is, I guess, this is end of 2024, but they are insane. They are insane. When we were car shopping in 2018, they felt expensive. Fast forward to now and it's like how, why and how did cars get so stinking expensive? And it like made me sick to my stomach to think that we would be going in. We're not, obviously we're not going to buy the car outright. When we're purchasing like a 50, 60, $70,000 car, we don't want to put all that cash towards a brand new car, so we would finance it, which means our finance, our monthly cost is going to be like around $1,000 a month just for a car payment.

Speaker 1:

And when I tell you I dug my heels in the ground about purchasing this car, it was like constant Brad was. You know, we were both not on the same page. I felt bad about it and he felt strongly about it, especially given the fact that our Toyota started having even more problems at the end of the year. He was like Rachel. This is a sign Like this means that this is really time for us to think about this and, being the stubborn wife that I am, we had a lot of real deep discussions I'm not going to call them arguments, discussions.

Speaker 1:

We had discussions about how to approach this financial decision and it was way stressful, and one of the things that my accountant had said was that if you're going to do this, you have to do it before the 31st of the month, at the end of December, because if you purchase, it has to do with, like tax code and whatever who knows Taxes kind of make me want to vomit but if I purchase it January 1st in 2025, the write-off amount would be significantly less than if I purchased before the 1st in 2025, the write-off amount would be significantly less than if I purchased before the 31st of December. And so he was like you can do it, but if you're going to do it, you got to do it before the end of the month, which also led to more stress, more tension and just feeling like we have to make this decision. Do we want to make this decision? Is this the right decision? How do we go about doing this? Are we being crazy for purchasing this brand new car that's so expensive, or are we being smart by purchasing the new car so we don't have to put all this money into the old car? I mean, you can just tell, probably by listening to this, like the dichotomy of thought, with what we processed and how we went through this. And this lasted for weeks and the turning point for us was we finally decided, after weighing the different options, we finally decided that purchasing a car that was about three years old was probably the best decision for us financially, not purchasing it brand new, because you know the depreciation right when you drive off the lot is insane. So buying it three years old, you know, kind of cuts down on that depreciation but it's still a nicer, newer car, it can still be in warranty and you're not going to have as many repairs on it. So that's kind of what we brought it down to. I still, at the same time, was like no, I don't want to purchase a car, but if we're going to purchase a car, let's. Let's do the three-year route.

Speaker 1:

Well, one day after church this was like what was it Like? December 28th or 29th, brad had found a car that was three years old, was low mileage and was in really good condition and it was also very under market value for like the Kelly Blue Book. You know, comparing prices, this was like a really good deal. It was thousands of dollars less than like the going rate for this car. And because we were purchasing on my business, I had to apply for the financing, I had to put all my information in and Brad gives me the phone and he's like, hey, fill out the financing, let's just see what kind of interest rate we can get, let's just see what the numbers look like. And I turned to him and I was like I don't want to do this, I don't want to buy a car.

Speaker 1:

And this was after us having decided that we were going to buy a car. And Brad got really upset and led to another discussion air quotes where in the car outside of my parents' house, having this discussion of like he is like you're putting me on this roller coaster of an experience where I thought we were purchasing a car and now we're not and you keep dragging your heels. And I felt like he was kind of putting me through this roller coaster of emotion of like trying to buy the car, trying to not. And this ended up where we are both in tears in the front seat of a car. You guys are getting like the full picture of what was happening. I'm giving you all the TMI details and Brad's probably going to kill me that I'm sharing all this but like, okay, so we're sitting in the front of our car, we are in tears about what the decision is, what the right decision is.

Speaker 1:

I mean, there's so much emotion wrapped up in just a stupid thing like buying a new car, and you probably can relate how we get so wrapped up in these emotions of this and we just have no idea what to do. We're kind of stuck in like how do we make this decision? How do we go about making this decision? And I mean we're very we're Christians. We believe in a higher power, we're very prayerful, we're very mindful, and we had been, when I say we had been praying about this decision and trying to make this decision for weeks, like it felt that way. And so we're both in tears.

Speaker 1:

Brad goes to put the car in the ignition and the car won't start in the ignition and the car won't start. It's dead, like 100% dead. And we both look at each other and we just start laughing. I mean again, we went from like crying and feeling so frustrated to literally sitting in the car laughing and being like, if this is the sign that this car needs to go, I don't know what else is. And unfortunately that was the point where it was like, okay, I have the piece that I need to move forward and get the new car and feel like it was the right decision for us, and so that's what we did. We applied for the financing. We got the interest rate we wanted. I mean, we shopped around for interest rates. We wanted the lowest interest rate possible. We got the warranty. We talked to the dealerships. You know we tried to get everything that we could out of this car. We did the test driving, we made sure the auto mechanic that it was running correctly and ended up purchasing the car at 8 pm on December 31st, four hours before the deadline of when we could purchase this car.

Speaker 1:

Going through this experience was, first off, such a good learning experience for both Brad and I and how we communicate and how we can make better decisions in the future. So it doesn't lead to us sitting in the front seat of the car in tears, but also the peace and the feeling that I've had after making the decision and having the new car and using this new car has been like, oh my gosh, we made the right decision for us, for our finances, for all of it. I feel so much peace about this car. Now I tell you this experience because I think there's a lot of things we can learn, first off, in what we didn't do, things that we didn't do, that you should do when you are making a financial decision. And then also, how can you go about making financial decisions so that you feel empowered and can look back and feel peace, so that there's no stress, that there is no financial stretch going on.

Speaker 1:

So first, the thing that I think I need to like tackle and get out of the way and this is maybe just for my own peace of mind, not for anybody else, but I know that I'm in a space where we talk about money, we talk about budgeting, we talk about saving, and talking about purchasing an expensive vehicle comes from a place of privilege and I don't ever want anybody to think that I have to justify my spending or how I use my money, because I'm not here to do that. I am here to stand in my power and say, yeah, we purchased the car, that was the right car for our family and all of the things that we needed to checkbox. We got the checkboxes. But I know that making big financial decisions, like buying a car, doesn't feel as heavy as like trying to pay off debt or just trying to hit your mortgage money every month. So when we talk about the things that I'm talking about, this doesn't just apply to these like frilly things, but also to just running your money in general.

Speaker 1:

And how can you purchase things and be in control of your money, so that you feel like your money is going in the correct direction and that you're in control of it. And one of the most important things you can do is to be an intentional spender. An intentional spender means that everything that you purchase, whether it's big or small, everything that you purchase, whether it's big or small, anytime money is coming out of your bank account, it is aligned with your priorities and your values. And I think that's where Brad and I came into a lot of dissonance with this decision is because my values, the things that I want, didn't feel like that car was going to give it to me. My value is family. My value is experiences. My value is being at peace and feeling that freedom.

Speaker 1:

And at the time I didn't think that the car would fill into those values. Now I was wrong 100%, because the time that my kids and I spend in the car together is really special time and we could do that in a Toyota Sienna or we could do that in the new car. But it's not taking away from that value. The freedom that I feel in our finances isn't any less now because we can afford the car. It's not a stretch for us, it's not like we don't have the money to pay off of it.

Speaker 1:

But one thing that I really missed out on in this intentional spending piece which I feel like could be the difference between a couple that gets along financially or struggles with money talks is that I forgot to weigh in what Brad's values are and what his priorities are, and we didn't have conversations about the deeper values that we hold, where we just were talking about buying the car but we didn't say, like, why do you want to buy the car? What's the deeper reason for you in this? And once I realized what Brad's values were, what his decision behind it was, and it's a little bit. Something that I'm just going to keep close to my heart that I didn't realize was his deeper value in this was so powerful, and once I was on the same page with him, it wasn't until we were sitting in the stupid car crying in the front seat that I realized what his noble intent was for this car was. It shifted everything for me, and I feel like, had I understand his deeper priority and his deeper value, it would have been. I would have respected his decision and felt good about his decision much earlier on.

Speaker 1:

But when you are deciding to make a big purchase, there are four questions that I think you should ask yourself. And if that purchase does not align with these questions, or you can't come up with answers to these questions, it might be something that you want to reevaluate, and I'm. What is the benefit of this purchase? So what am I going to get for it? Does it solve a problem? Does it bring me just joy Maybe I just need a little bit of joy or does it align with my values? So what is the benefit? What am I getting from this purchase?

Speaker 1:

And then number two are there alternatives that could save me time or money? Is there something else that I could purchase to then have the same thing that I was looking for from that benefit, but it's not as expensive. So making sure that you explore all options. And then, once you've explored the options, are you okay with the trade-off? So every purchase has a trade-off. And is the purchase that I'm making? Is it a good trade-off? Is it a bad trade-off? Am I okay with that type of trade-off? And then, number three what is the purchase that I'm making? Is it a good trade-off? Is it a bad trade-off? Am I okay with that type of trade-off? And then, number three what is the time and resource cost of these alternatives? So just kind of unpacking that. Second question If I do decide to go with something different, more affordable, saves me time, saves me money, is it worth it to me? Does saving the money cost more in stress or time or energy later on? So you have to weigh out those decisions. And then, fourth, and probably the most important, is does this purchase align with our financial goals in the future? Is buying this thing going to get me closer or further from my long-term goals? And you may be saying anytime you purchase something that's a want that's expensive is taking you away from your financial goals in the future, and I would just question that that maybe your financial goals for the future aren't actually having a certain amount of money saved, but they're having a lifestyle that you also want. So you have to decide what do I want in the future, and is this going to help me get there?

Speaker 1:

Big purchases should always be evaluated in the context of your overall financial health. You know your finances or you should know your finances better than anyone, and you know what your long-term goals are. So nobody can tell you whether purchasing a new car or a new toy or a new house or whatever it is, nobody can tell you whether or not that's a good purchase or not. Any financial coach should never say that to you. What they should say is do you know your financial landscape? Can you afford it? Is it worth it to you? So you have to decide that for yourself. I'm never going to tell anybody what they should or shouldn't buy. That's not anybody else's place. Not for cars. That's not anybody else's place. Not for cars, not for groceries, not for anything.

Speaker 1:

That's the work that you have to do, but what I do think someone like me or somebody else in the financial world that what they can do is they can give you tools to evaluate what are your financial priorities, what are you needing to accomplish in the next three years, in the next five years, in the next 10 years? And then how can you feel empowered to make a financial decision that's right for your family? So it needs to come from a place of abundance. It needs to come from a place of empowerment and not scarcity and not feeling like you're not in control of your money. That's where we really get to that piece with making purchases and something that and as I was going through this experience with Brad, this was really one of the first experiences that we've had where we didn't see eye to eye on making a big purchase. Everything that we've come up to up to this point, we've both been 100% on board and felt like it was the right decision. And this one we had to weigh a little bit more and there was more discussions, there was more, you know, bending to the other person and really trying to be on the same page so that we could both jump in with two feet and feel good about this decision and making it move us closer to our long-term goals. I feel like this was.

Speaker 1:

I shared a lot in this episode about our decision, but I do think it's so important for people to realize that everyone is going through this. If you're struggling with making a big financial decision, you're not alone. Like a lot if not all marriages at some point or another are going to have to make these decisions and have these conversations, and sometimes it's as simple as hearing about somebody else's experience and what they went through to really feel like you can step into your power and make decisions as well in a partnership. So I'd love to hear what you thought. If you took away anything, or if you've ever had an experience like this, shoot me a DM. I want to hear about it. Hopefully, you feel like you can now go make some decisions in a better position make good financial decisions for you and your family. All right, that's it for today. I'll see you next week.

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Rachel Coons

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