Okay... so this may sound bad... but I am going to skew my ratio. Currently it is about .62% but I am car shopping. I was going to just mothball my current vehicle... a 2006 VW Jetta TDI with 325,000 miles. I know that sounds crazy... please someone tell me that is crazy. I guess you need to hear the whole story to make a recommendation.
I am shopping for a Dodge (or Freightliner, or Mercedes) Sprinter Cargo Van to convert to a stealth camper to travel full time around the United States and hopefully up into Canada and down into Central and South America in. My budget for the entire conversion is about $15,000. My takeoff date (hopefully) is August 15th. My income is mostly passive and I feel like my expenses on the road will be comparable to off the road if not lower because I am paranoid about running out of money still. I will also have the added income from renting my primary residence. If things get tight I will pull over and get a restaurant or bar job - free food and fast cash.
So... I want to keep my car for about the first three months that I am on the road (in a barn on the family farm - no cost) to make sure that I like being on the road before I sell it. Should I just go all in and sell it before I go? I realize I can "store" it on Craigslist, but I also know what has been done on this car in the past two years. I shouldn't have to put any money into it for at least another two years. Almost everything has been replaced, I won't find another with this mileage as meticulously maintained.
On the flip side... two vehicles is silly especially if one is not being used.
Okay... so I just re-read this. I sound like a crazy person. In the first line I say, "I was going to just mothball my current vehicle." Seems like subconsciously I had already made up my mind. I am going to go with that. I will store it on Craigslist. If anyone wants the car it is $6,000. But you have to wait until my camper is done. I'm going to a dealer auction to look at a Sprinter tomorrow. They are estimating a sales price of $6300... I want to see it first, but I am hoping to get it for about $5,000. I guess that will make my ratio lower technically... the $10,000 on the conversion would be housing value vs. net worth right?
So my current car value is $6,000 we will call my replacement car value also $6,000. So that is a wash.
My current home equity is only about $15,000 (pulled out most of equity at 3% interest as a downpayment on 6 rental homes - trust me... the numbers are good.) I would value my finished camper at about $25,000 based on what I am looking at as a base vehicle and what I have seen... I feel like the value will hold between $18 and $22k for 1 to 2 years depending on mileage. So while car wise this is a wash, it does have me tying up more cash in my "home."
I increase my equity $10,000, but I increase the money I have in my home from $15,000 to $19,000 to $20,000.
Okay... that is all really negligible. But I do thank you Mustachians for listening to my nonsensical dribble long enough for me to decide I need to sell my current car.