Some common phrases I hear when people buy a new car include variations of: “It was more expensive to repair than to buy new,” or “The repair cost more than the car.”

I’m going to debunk these claims. But before I do, let me say this—if you can afford a new car, go for it! New cars are great. They reduce stress, eliminate hassle, and, for some, bring real enjoyment. But it’s rarely an economical choice.

To be fair, I’m writing this while waiting for our old Toyota Highlander to finish its 100,000-mile service, plus some extra repairs—costing more than $1,300. So, maybe I’m just trying to make myself feel better about the expense…

Most pre-retirees I meet with for the first time have a fairly good estimate of the regular monthly expenses. However, the area that is hard to predict and plan for is the unexpected costs. One exercise that I like to do that brings clarity to this is to review actual expenses for the past few years. We often find that irregular expenses are the culprits – helping a daughter with her car, an HVAC replacement, or a dental procedure.

It can be tempting to assume that these expenses will mostly vanish in retirement, but they don’t. These one-off financial obligations can put a significant dent in your retirement savings if you're not well-prepared. While there can be a lot of surprise expenses, I found that they typically fall into four key areas…

Maybe you’re considering renovating your master bath or kitchen – or doing something simple like changing out the toilets or garage door. There are plenty of reasons to do projects like these but one I hear most often is “to increase resale value.” But does it really do that?

According to the Cost vs. Value 2022 report, below are the national averages for what you can expect to recoup from various home renovation projects…

One of the most difficult parts about sticking to a savings plan is that no month looks the same. It’s easy to budget for fixed expenses like your mortgage, phone bill, and subscriptions. With time, you can estimate some variable expenses like eating out and groceries.

But it is much more difficult to plan for irregular expenses like out-of-pocket health care expenses, replacing an HVAC, a big vacation, or a broken transmission…

“A banker is a fellow who lends you his umbrella when the sun is shining, but wants it back the minute it begins to rain” - Mark Twain 

Individuals in the process of buying a home with financing usually get a “maximum loan amount” from the bank. Some assume this is a reasonable estimate for what they can actually afford…