What is Retirement ?

[greypiggi]

For myself, I've never felt the need to impress people, so that may explain why I never desire for nice cars, or even a car in the first place.

frankly, how many people spent less than 10% of their annual income on their transport expenditure owning a car if u add all the above costs?

This is interesting. I just bought a fun car lately. Reason? Always drove boring cars and figured its now or never while still relatively young. Like musicwhiz, i more inner scorecard type person so never saw it fit to impress others. But as years go by and social circle expand, i also realize sometimes too inner scorecard also put people off and it is fun to drive a technologically advanced machine. Now i finally know what people mean when they say hugging the curves and quick acceleration. So guys if can afford, try it as it is quite worth the fun and even the COE. The attention is not negative esp since there are so many super cars and sports cars on the road nowadays.

Key thing is can afford. I think 10% of income spent on car expense is very fair. Before i made my retirement money, i spent probably about 7-8% of household income on all transport expenses including annual deprecation of the car values. And it was very comfortable. No stretch. For car loans, what i did was to just take 1 year loan to minimize the interest paid.

However, I think once one has accumulated enough wealth, should use a percentage of net worth or assets. I currently subscribe to allocating not more than 2.5% assets (include liabilities) on depreciating stuff like cars and totally lifestyle assets like watches, jewellery, time shares, club memberships etc.

The 2.5% is arbitrary... i derived it from the fact that i do not put 2.5% of asset in any one investment regardless of how good i think it is. The only exception is property which has too high per unit value to do that.