How should I prioritize

[Flava_babe]

I am seeking opinions on how to prioritize some of my immediate goals.
Right now I want to do the following
*Pursue my MBA degree
*Rent a bigger more convenient apartment
*Lease a car
*Save towards purchasing my own house

My problem is, I am not able to accomplish all of them simultaneously.
If i do the MBA, i cant afford anything else on the list until after 2 years when I have completed the degree. If i relocate now I will have to buy a car as commuting to and from work is not possible unless i take a cab daily which is very expensive. The cost of owning a house in my country is very very high and even with a mortgage I will still have to find a hefty portion from my pocket to cover deposit and closing cost so the house option seems like the biggest and longest task.

How do I decide what to do in priority order? Your opinions are really appreciated.

[maat55]

The first thing I think of is that we need more information.

What are the numbers involved?

In general, which is more important? Will taking on higher debt/cost endanger your priority?

IMO, you want too much now, if your education is your first priority, make the others fit it. As far as buying a home is concerned, do not be in a rush. Prices are not going up anytime soon, you will likely benefit from waiting longer.

I highly recommend that you not lease a car. Many people never reach their financial goals due to worrying about how they look getting there.

[Flava_babe]

The first thing I think of is that we need more information.

What are the numbers involved?

In general, which is more important? Will taking on higher debt/cost endanger your priority?

IMO, you want too much now, if your education is your first priority, make the others fit it. As far as buying a home is concerned, do not be in a rush. Prices are not going up anytime soon, you will likely benefit from waiting longer.

I highly recommend that you not lease a car. Many people never reach their financial goals due to worrying about how they look getting there.

The prices will seem very high from my end as I am not in the US.
The tuition for the MBA is 1.3 million (approx 15,000 USD)
Car approx 1.5 million which will be financed on a 10% interest rate loan
Renting a more convenient apartment - approx 30,000 per month. I currently pay 19,000/month but I and having major inconvenience issues with my unreasonable landlord so that's why I have to relocate.
Buying a house approx 10 million and that price is on the lower end of the scale.
My annual salary before deductions is 2 million

[dawnwes]

Do you need a car? Do you have one now? Do you take public transportation? I would NOT get a new car, nor would I accept a 10% interest rate.

Do you have a job? Do you need an MBA? Will the MBA equal a better salary? I would start here if it will help you.

You need to move, but does it need to be a bigger, more expensive place?

[disneysteve]

It is somewhat difficult for us to address your questions because you are not in the US. The rules that apply here and the recommended percentages for spending may not apply where you are.

For example, I would never recommend someone take a 10% car loan, but that may be the norm where you are. I just don't know. For buying a home, the rule of thumb here is to spend no more than 3 times your annual income. You are talking about spending 5 times your income. That wouldn't work here - you'd probably never get a loan - but it might be more normal where you are. And I never advise leasing a car. If you can't afford to buy it outright, you probably shouldn't be getting it, but things may be different where you are. I just don't know.

[Flava_babe]

It is somewhat difficult for us to address your questions because you are not in the US. The rules that apply here and the recommended percentages for spending may not apply where you are.

For example, I would never recommend someone take a 10% car loan, but that may be the norm where you are. I just don't know. For buying a home, the rule of thumb here is to spend no more than 3 times your annual income. You are talking about spending 5 times your income. That wouldn't work here - you'd probably never get a loan - but it might be more normal where you are. And I never advise leasing a car. If you can't afford to buy it outright, you probably shouldn't be getting it, but things may be different where you are. I just don't know.

Yes I agree with you. The figures will look unreasonable from your end but they are quite the norm in my country. a 10% loan is the lowest as its an employee benefit by my employer, most persons dont get that benefit. The normal interest rates are like 18% and above. The average cost of a house in my country is about 20 million dollars and based on your income and age you are given a mortgage and most time the amount you are qualified for is not sufficient to buy the house.

I am leaning towards forgetting about buying a house for now. The MBA will benefit me greatly career wise so I will hold that as priority 1.

[disneysteve]

If the MBA will advance your career and lead to better employability and higher wages, I would focus on that first. Doing so will make the later items on your list easier to accomplish in the future.

[maat55]

The prices will seem very high from my end as I am not in the US.
The tuition for the MBA is 1.3 million (approx 15,000 USD)
Car approx 1.5 million which will be financed on a 10% interest rate loan
Renting a more convenient apartment - approx 30,000 per month. I currently pay 19,000/month but I and having major inconvenience issues with my unreasonable landlord so that's why I have to relocate.
Buying a house approx 10 million and that price is on the lower end of the scale.
My annual salary before deductions is 2 million

I'm guessing your income in US is roughly 22k and you are wanting to buy a 115k home. I cannot think of any country on earth where 115k is the low end of housing.

In reality, you need to lower your expectations for now. Surely you can buy a used car for far less as well.

As far as the order of priorities, you should prioritize your ability to earn decent money in your market place. This may include a MBA or learning a trade.

Finding a balance between home, car and saving are your next issue. You certainly want a home that is safe, but it does not have to be expensive. A car is a means to travel. It should be lowest on your scale of priorities. Being able to save money at any income is a must. What you save the money for is subjective to your current goals.

[jordanjanet47]

Getting a car would be my last priority. If you can rent a house near your work place or college, I would make MBA my first priority, unless I am getting paid well for my current job.

[DebbieL]

I'm guessing your income in US is roughly 22k and you are wanting to buy a 115k home. I cannot think of any country on earth where 115k is the low end of housing.

You cannot think of any country where $115k is the low end of housing? How about Canada? The average for Canada is somewhere around $350k, and where I live (Victoria, BC, Canada) it is over $600k. I would think there are many countries where $115k would be the lower end of housing costs.

[DebbieL]

OP, given your income, renting in your area is extremely cheap - I would keep doing so. Even if you move to the new, more expensive rental it will only be about 18% of your income. I would continue renting and saving up your money for an eventual house purchase. I cannot advise on the MBA since I don't know how much it will help your earnings, etc.

[maat55]

You cannot think of any country where $115k is the low end of housing? How about Canada? The average for Canada is somewhere around $350k, and where I live (Victoria, BC, Canada) it is over $600k. I would think there are many countries where $115k would be the lower end of housing costs.

I have and could live in a mobile home if necessary. I'm betting I could find a decent place to live in Canada for well less than 115k. I understand that there are different markets, but no decent market forces those earning 20k to pay more than they can afford.