Financial Storytelling

Hi Chris,

Meet Carl.

Carl’s an up-and-coming millennial A-player who’s been setting himself up for success since he walked onto his high school campus as an awkward freshman eight years ago. (He finally stopped having those dreams where he showed up for class three months late, or that he didn’t study for a test that had been planned for weeks.)

Carl isn’t much different than you.

• Got accepted to college. Check.
• Graduated from college. Check.
• Got a professional job making a great salary. Check.
• Bought a new car. Check.

Carl made a critical mistake though—a financial blunder that he’ll never realize will prevent him from building wealth, and equally important, possibly prevent him from saving for retirement. He took on a car payment.

Here is where you stop being like Carl.

Did you know?

• The average car payment is over \$500. Five. Hundred. Dollars. Say what?
• A new car loses 20% of its value in the first year (and 10% the day you drive it off the lot!)
• $500 a month invested with an average 10% return for 30 years is roughly $1,040,000.

A $500 car payment for 30 years works out to $180,000. They don’t point that out at the car dealership, where they are happy to set you up with a monthly payment ‘you can afford’. And after five years, they’ll help you do it all over again.

Newbie buyers who strap themselves in to sixty monthly payments of misery learned from their parents, who in turn learned from theirs. Growing up with a car payment as a regular part of household expenses has become the American way. Car loans are wealth assassins looming to kill any chance you have at building a large nest egg.

Why are we telling you this?

Because changing this car-buying-on-the-dark-side behavior could move you to a lane of retirement savings success early in your adult life. Consider driving an older car now, and slowly move up in cars as you can afford them (translation: pay cash).

Picture yourself investing \$500 a month toward your retirement instead. You’d be happy-dancing down the road of a million-dollar stash toward your retirement (from one investment).

Imagine how that would feel.

What if when it’s time to retire, you’re able to travel to destination weddings anywhere in the world; or to high school and college graduations anywhere in the country? Or how about if you could buy a second home somewhere you’ve always dreamed about getting away?

These are real possibilities when you plan for your future and make wise financial decisions now.

So don’t be like Carl. Pull on your adulting pants, exercise car payment restraint, start building wealth (or step up your game), and plan for your retirement.

Ask a financial advisor from Pacific Life about how you can create a plan to build wealth for your retirement. Do it before the sun sets today. You won’t be sorry.

Don’t worry. We’ll make sure you can still enjoy your life and your hard-earned salary, and even be able to say yes to the guacamole once in a while. 😉