At 32 and 31, my husband and I have spent the past 10+ years driving cars that our parents gifted us (thanks parents!). We knew we’d have to replace my husband’s first as it was truly a piece of junk. We decided on an amount based on Dave’s guidelines (spend no more than half your annual income on things with a motor – so we limited ourselves at a quarter of our combined incomes since we need 2 cars). After a few years of patiently saving and months of researching cars, we finally paid cash for a really nice, new (to us) car at the beginning of this year.

Two stories to go along with this:
A few months ago when we told my husband’s parents that we were expecting our first baby, his dad asked if that would mean that getting a new car would have to be put on hold. To most people (including his parents), buying a new car translates to adding a new monthly payment. When you pay cash, you either have the money or you don’t…you don’t have to decide if you can take on another monthly payment. So when we hit the right amount in the car “envelope” (ie bank account), we could confidently buy the car without worrying how it would affect other financial decisions like getting rid of the mortgage, saving more aggressively for retirement, or having a baby.

And secondly:
I have always been the saver/planner, and my husband the spender (luckily, he’s excellent at following any rules I put in place!). I think experiencing the benefit of patiently following a plan has really encouraged him to “live like no one else.” For the first time this year, we sat down TOGETHER to come up with a new budget. We tightened it up in preparation for the baby, and he’s very enthusiastic to stick to it!