My truck was totaled, now what?

[emanon1501]

Before I give you some background for your feedbacks to help us make better decisions. My family and I love to go camping. In a perfect world, we would pay cash for the truck and the camper. That is not possible and the idea of getting a loan bothers me, but having memories with my kids are priceless.

I had a 2004 F250 with 70K miles that was bought cash 3 years ago. On the way to pick up new to us camper, I hit a black ice and totaled the truck. I was the only one in the truck and I hit my head on window hard. My glasses flew to the back seat despite the fact that I hit the guard rail head on. The insurance gave me a check and I can easily find an older truck and pay cash for it. But, with the way I hit my head on the window, I am wondering if I should buy 2008 or newer and take out a small loan on the truck in order to have a truck with curtain air bags to protect my kids?

I am trying to figure out the best way to do what we love to do without getting too much in debt or have payments that will be too hard on the budget. I have been making extra payment toward to my wife's car and then I planned to tackle the home improvement loan that was taken out to cover unexpected problem. With the wrecked truck, this will have an impact on the plan.

Here is my run down of current budget in percentage. I really don't want to give dollar amounts, so I will use percentage, which is how I do my budget anyway. You will notice that my loan % is lower than what is recommended. For example, bank pre-approved us to buy a house for 350,000, but we bought a house was 130,000 less than what we were pre-approved for. We try to live below our means.

Below is a percentage of Gross Pay
Mortgage 18% (including tax and insurance)
Wife Car 3%- 8,800 left
Home Improvement Loan 4% - 23,000 left - This loan is the one I hate the most.
Retirement 23%
Various bills(Cell, electric, water, etc.) 6%
No CC debt (never carried a balance since 2007)
20k Cash in liquid state including what was given to me from my totaled truck
Plenty in investment



This is what would add to our budget if we decide that camping and memories are more important then being in less debt or debt free.
Camper 2% of gross pay 11,000 loan
New to us truck about 2% of gross pay around 5,000 in loan


If I add up the percentage for truck, camper, and my wife's car, it adds up to 7%, which is below the 10% rule for one car payment. Now, if I use take home pay instead of pay, it will be right at 10% rule.


Normally, I would not ask for feedback as I handle the budget well, but I am torn between doing what we love and create memories vs. staying out of debt or avoid accruing more debt. Wrecking my truck not only messed up my head, it pretty much messed up our budget and dreams.

Any feedbacks or suggestions will be greatly appreciated.

[JulieAlbright]

I really only had time to quickly scan your numbers so this is just my gut reaction.

My advice to you would be to put the money into the upgraded truck. It seems like what you are considering is a solid, used, reasonably priced truck. I'm not an expert on the cost of those but if you need a small loan, then take the loan and pay it off quick.

Then - hold off on purchasing a camper for a little while until your finances stabilize. Tent camping or rent a camper as needed for a bit while you save up the money. Then purchase the camper you want.

[autoxer]

I wouldn't make a decision on the basis of being able to fit the loan payment into the budget, that is only part of the picture. You also have to consider the length of the loan and interest rate, because this decision is going to have a long term negative affect on your wealth. Car payments don't have to be a fact of life, they are a choice. Ultimately everyone spends their money on what they value. If financing these toys adds more value to your life than financial stress, then you don't have to feel torn about the decision.

Do you already own the camper or is that part of the decision?

How long would it take to save up enough money to pay cash for the truck and the camper?

[emanon1501]

Good News. I found another truck like mine. I will be able to pay cash for it, so my budget will remain the same. Fingers crossed.

[snafu]

I hope you've fully recovered from the ghastly accident with no long term medical issues. Black ice is a huge problem. If you live in winter conditions, do you change out tires? Are chains legal in your region? Since you were a single vehicle crash, were you charged for driving too fast for road conditions?

Caution, does truck have safety features like airbags? I hesitate to mention as airbags likewise have potential to injure small children. What can be done to help prevent injuries that result from say, a rear end hit since family rides in truck's cab, not ever in an adjacent camper.