10 Amazing Retirement Locations, My Podcast Debut, and Living the Hallmark Christmas Movie Experience

Leaf covered path bridge

My mind is definitely wandering toward travel if these links are any indication. I think it’s the knowledge that winter is upon us up north and I will be seeing way more of the inside of my home. This dread coupled with the promise of a vaccine before too long has me thinking about the next trip. What I’ve been reading:


Retirement

Find out where you measure up when it comes to 401k savings – (U.S. News & World Report)

If you reach $1 million in your 401k by the time you retire, you’ll be ahead of the pack by many multiples. Start saving aggressively, and increase the amount every year. If you can meet the 401k max, you’ll be in good shape.

 

The top 10 countries to retire in – (Business Insider)

Have you ever dreamed about retiring overseas? It’s never too early to start scoping out potential locations.


Investments

I had the privilege of joining Kyle Hill, CFP®, on his podcast – Personal Finance from the Hill-Top. We talk about the basics of stocks, bonds, diversification, and more.


Travel

It’s going to be a long winter – embrace it! – (The Washington Post)

“Friluftsliv…translates to open-air living and exemplifies the tradition of making time outdoors part of daily life — whatever the season.” Take it from the Norwegians, because they know how to do cold. When you get tired of the indoors this winter, make the outdoors your friend.

19 hotels you’ll want to book just for the bathtub – (The Points Guy)

I haven’t take a bath in 40 years. Yes, I said it! I’m solidly in the shower camp, but I could change my mind if I had these views.

Towns to visit in Pennsylvania if you want to feel as if you’ve been dropped into a Hallmark Christmas Movie – (Travel Awaits)

This might not be the best year for a Hallmark Christmas Movie experience, but save this link somewhere special, and when travel conditions improve, you’ll have a Christmas destination mapped out.


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    Financial Advisor David Tuzzolino

    David Tuzzolino, CFA, CFP®, is the Founder and CEO of PathBridge Financial, a firm that specializes in providing comprehensive financial planning and investment management services for clients that are nearing retirement and love to travel.

    146 Minutes of Fame

    Personal Finance

    Some people get 15 minutes of fame, I got 146 of them! It was my pleasure to join Kyle Hill, CFP® on his podcast – Personal Finance from the Hill-Top. 

    I put on my CFA cap and we walk through the basics of stocks, bonds, diversification, and more. You even get to hear me try to pronounce foliage.

    Click on the link below to listen!

    Personal Finance from the Hill-Top Episode #6 – Diving a Layer Deeper into Investments


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    Financial Advisor David Tuzzolino

     

    David Tuzzolino, CFA, CFP®, is the Founder and CEO of PathBridge Financial, a firm that specializes in providing comprehensive financial planning and investment management services for clients that are nearing retirement and love to travel.

    How Much Do You Need to Retire (and Travel), What Makes You Happy in Retirement, and Soup – Links

    Path bridge through the woods with leaves turning colors

    Now that Halloween and Election Day have passed, is it too early to put up the Christmas tree? The old stand-by of waiting until Thanksgiving is over doesn’t seem to make sense in 2020. 

    The most common question I hear from people who reach out to my firm is – “How much do I need to retire?” I walk you through the process for do-it-yourselfers who want a quick answer. Also included below, the best of what I’ve been reading on retirement, travel, and, yes, soup. 


    Retirement

    How Much Do I Need to Retire (and Travel Like Royalty)? – (PBF)

    I walk you through a quick-and-dirty way of coming up with your number, using readily available online retirement calculators. If you’ve ever asked yourself – “How much do I need to retire?”, this is the article for you. If you enjoy traveling, I also discuss why it’s crucial to incorporate travel expenses into your budget before and after retirement.

    Over 55? Your retirement is more uncertain than ever before – (Forbes)

    It’s a warm and fuzzy feeling when you have a well-developed comprehensive financial plan. That is until your age 65 retirement suddenly, and without your consent, is forced upon you a decade early. Moral: always plan for retirement conservatively, erring on the side of an earlier than expected retirement. You may not have to retire at 55, but it’s nice to be prepared if it’s forced upon you.

    What makes you happy in retirement according to financial advisors? – (U.S. News & World Report)

    No earth-shattering surprises here, but a good reminder that it’s a mix of financial and social factors that will make you happy in retirement. If you ignore either side, your happiness will likely suffer.


    Travel

    Holiday Travel Report – (ThePointsGuy)

    Are you traveling for the holidays? Mix a little Mad Max with ER. Ok, it’s probably not going to be that bad, but I have to imagine stress will be elevated even more than usual, and everyone will be concerned about health.

    Financial Independence / Abbreviated Retirement – (New York Pilot)

    Think mini-retirement coupled with life-changing adventure. I believe we’re going to see a huge spike in this once the coronavirus is under control. We are all learning the valuable lesson of not waiting to do things you love. Do it now; you might not have a second chance.


    Soup

    26 soup ideas for the upcoming winter from around the world – (MSN)

    It’s that time of year! Are you ready to get your soup on! If you’re looking for ideas, here are 26 recipes to keep you warm.


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    Financial Advisor David Tuzzolino

    David Tuzzolino, CFA, CFP®, is the Founder and CEO of PathBridge Financial, a firm that specializes in providing comprehensive financial planning and investment management services for clients that are nearing retirement and love to travel.

    How Much Do I Need to Retire (and Travel Like Royalty)?

    A white castle rises out of the forest, clouds in a blue sky

    A Simple Retirement Calculator

    One of the most common questions in planning for retirement is: “How Much Do I Need to Retire?” And since I specialize in working with travelers, travel always comes up. The question may be, how do I travel like royalty, a rock star, or just, well?

    The answer is incredibly simple: “It depends.”

    You can start with a quick-and-dirty analysis that won’t take you more than fifteen minutes. NerdWallet.com has a solid, basic retirement calculator here, but the following concepts will work with any calculator you use.

    The initial inputs are straightforward: age, income, current savings, and the amount you save every month. The retirement calculator then illustrates how much you will have at retirement compared to how much you will need to retire. Simple, and not a bad start, but there are ways to refine your results further.

    On the NerdWallet calculator, click “Optional.” Additional inputs appear.

    The first input, “Monthly retirement spending,” is automatically set to use 70% of your pre-retirement income. A common rule-of-thumb is you’ll spend approximately 70-80% of your pre-retirement income once you retire. However, I have found this number can be low, especially when working with clients who expect to travel extensively. Consider bumping this number up to 90-100% if you’re doing a quick calculation. If you’d like to refine this number, put together a detailed budget for retirement, keeping in mind the significant changes that can occur when you tackle your bucket list and medical expenses grow.

    The next input is “Other expected income.” This includes Social Security, pensions, annuities, and other income sources you may have in retirement.

    The default age of retirement is set to 67. Change this to your desired retirement age. Also, have some fun with it. Increase your age, lower it, and see how it affects the numbers. Your final number should be conservative, perhaps a few years before you’d like to retire. This will build in some extra cushion to your projections. Many people retire earlier than they expected due to layoffs, early retirement packages, or health issues.

    Life expectancy is automatically set to 95, a reasonable number. However, maybe you have a family where everyone sails past 100 in excellent health. You can always make adjustments, and the bigger the number, the more conservative your estimates will be.

    The “Investment rate of return” default is 6% pre-retirement and 5% after retirement. These rates of return assume your portfolio will become more conservative post-retirement. These are reasonable estimates, but you can adjust the pre-retirement return, either up or down, to see how your results change. Just be realistic and don’t stray too far to the upside.

    How does it look? Are you on track? If you are, fantastic!

    You’re not quite done, however. Play with the numbers and create some worst-case scenarios. What happens if you have to spend dramatically more than you anticipated? How do you look if your investment returns are lower than expected? If you are still on track to retire, try nudging down your retirement age. You may not want to retire early, but it’s nice to know the option exists.

    More Detail

    The quick-and-dirty option above is acceptable for some. However, if your life is a little more complicated or you want to get more granular, consider the information below.

    Expenses

    Let’s refine the “Monthly retirement spending” part of this model.

    Put together a detailed list of your expenditures. There are hundreds of budget spreadsheets online. Find one that does a good job of breaking out spending into categories that will help you organize your expenses. If you’d like the spreadsheet that I use with my clients, please send me an email at david@pathbridgefinancial.com. Double-check your spreadsheet with bank statements. Does the spreadsheet expense total equal what is coming out of your bank accounts? If not, figure out why and adjust.

    Next, focus on retirement. Make a copy of your spreadsheet and start reducing or eliminating expenses that might change once you’re retired. What commuting expenses will go away? Will you continue to need a second car? Will your mortgage be paid off? Do you have life insurance policies that you will no longer need?

    Unfortunately, not all expenses will decrease. Health care costs will grow as you age. Projections vary greatly, but a 65-year-old couple should expect to spend approximately $11,000 a year on health care in retirement. Fidelity Investments has a health care cost calculator that will take you about three minutes to fill out.

    Now, the good stuff. In retirement, travel and leisure often increases in frequency and duration. Dream vacations to exotic locations, the purchase of an RV or boat, a summer in Tuscany, the lake-cabin you’ve always dreamed about – let your mind wander. How much would you like to spend on travel? Go into as much detail as possible.

    How you like to travel will affect your travel budget. Do you prefer 5-star luxury resorts on the other side of the world and dining at Michelin-star restaurants?

    A chef uses tweezers to complete a fine dining meal

    Or do you find most of your vacations are within driving distance of your home where you stay with friends, and you pride yourself on scouring farmers’ markets to prepare home-cooked meals? Odds are you’re somewhere in the middle, but dive into your travel deeply and try to put together a realistic travel budget.

    It’s easy to get caught up in dreaming about once-in-a-lifetime trips, but there’s something that most people find even more important – family. You’re likely to have much more leisure time in retirement, which usually results in more family time. How many trips are you going to take to visit your loved ones? Grandchildren especially can be an irresistible draw. Don’t forget to add these trips to your retirement travel budget.

    Don’t hold back when estimating expenses. We’re talking about traveling like royalty here! Err on the high side, and don’t be afraid to include some extravagant extras. It’s better to reach, and save some extra money, then underestimate and not have enough. You can always reduce some expenses or eliminate some of those extras when the time comes. A key concept when planning for travel in retirement – be flexible.

    Income

    If you’re going to adjust the “Other expected income” amount in the calculator, keep in mind that this will increase income every year between retirement and death – a limitation of this model.

    In reality, there are ways to increase income for a portion of retirement, including part-time employment or renting out a home, but these are unlikely to last your entire lifetime. There are also one-time income sources that might make a huge difference, such as selling a house or an inheritance. If you are running into too many one-offs, consider consulting a financial advisor who has software that can accommodate any non-standard inputs. I discuss this later in the article.

    The Answer

    By now, you should have a reasonable answer to your question: “How Much Do I Need to Retire (and Travel Like Royalty)?”

    You should have a good idea of how much you need and how your current situation looks in comparison. Are you coming up short? The best way to address this is to save more if you can. Even a few hundred dollars each month can be meaningful if you adjust course early.

    If saving more is impossible, nudge your retirement age higher. Working an extra year or two might be the solution to your shortfall. Spending less in retirement will stretch your nest egg as well. Remember, being flexible is key.

    However, don’t be tempted to increase the investment rate of return just to meet your retirement goals. It’s conservative for a reason, and you should keep it that way. A balanced portfolio of stocks and bonds isn’t going to return 15% a year over the long-run, just because the calculator allows the input.

    retirement travel illustrated by a tablet and statements

    If you’re unsure of what rate of return to use, Vanguard has a website that illustrates the average investment return for stock/bond portfolios over 90+ years. There are no guarantees that the future will deliver the same results, but it’s an excellent place to start. Remember, it makes sense to be conservative.

    You May Need a Financial Advisor

    There are many reasons you may decide to contact a financial advisor. The most important reason – your question: “How Much Do I Need to Retire (and Travel Like Royalty)?” was not answered adequately using online resources. Also, consider the following:

    • Would you prefer more detail in your retirement projections?
    • Does your situation involve a level of complexity that an online calculator cannot handle?
    • Would you feel more comfortable talking through your important retirement decisions?

    If you answered yes to any of these questions, you might want to talk with a financial advisor. Where do you start? I recommend reading this article from the CFP Board: “Ten Questions to Ask Your Financial Advisor.” Or, if you’d prefer a little humor with your advisor search, please take a look at my article: “How to Spot a Terrible Financial Advisor You Can’t Trust.”

    Now that you’re armed with what to look for in a financial advisor, I recommend the following directories:

    Find a CFP® Professional

    The National Association of Personal Financial Advisors (NAPFA) Find an Advisor

    Summary

    The answer to the question, “How Much Do I Need to Retire (and Travel Like Royalty)?” is – it depends. It depends on your wants, needs, and resources. Whether you tackle this question with an online calculator or with a financial advisor, make sure you’re comfortable with the results and have a clear understanding of what it will take to achieve success.


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    Financial Advisor David Tuzzolino

     

    David Tuzzolino, CFA, CFP®, is the Founder and CEO of PathBridge Financial, a firm that specializes in providing comprehensive financial planning and investment management services for clients that are nearing retirement and love to travel.

    A Haunted Hotel, How to Deal With an Unexpected Retirement, and 34 of the Best Travel Podcasts – Links

    The figure of death walks across a pathbridge

    The next week is going to be action-packed with Halloween and the election. Take some time this weekend, turn off the onslaught of political ads, and enjoy the first full moon in 76 years! Enjoy it while you can, because you’ll be waiting for nineteen years to see the next one. Happy Halloween!


    Retirement

    “Paying too much attention to politics can be harmful to your wealth.” – (Forbes)

    Elections can be stressful times, and the stock market has a history of volatility during times of perceived uncertainty. However, if you’re investing for the long haul, you have nothing to worry about.


    Unexpected Retirement – (Vanguard)

    Unfortunately, many people don’t work as long as they had planned – especially given today’s coronavirus-fueled layoffs. Vanguard has put together a solid list of steps to take if this happens to you.


    Early Retirement – Steps to Take – (Forbes)

    Planning is easier when it’s broken into two phases – pre and post-retirement.


    Travel

    Staying in a Haunted Hotel – The Terror and the Humor – (PBF)

    Happy Halloween! Ever stay in a haunted hotel all alone? This is my story.


    34 of the best travel podcasts – (Travel Massive)

    If you’re looking for a travel podcast, I got you covered!


    Would you fly if everyone on the plane is tested for COVID before takeoff? – (CNBC)

    A vaccine would be fantastic, but small things like rapid-results testing add up and might be just as important to getting life back to normal.


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    Financial Advisor David Tuzzolino

    David Tuzzolino, CFA, CFP®, is the Founder and CEO of PathBridge Financial, a firm that specializes in providing comprehensive financial planning and investment management services for clients that are nearing retirement and love to travel.

    Staying in a Haunted Hotel – The Terror and the Humor

    Haunted Hotel with large orange moon

    It’s a cold, blustery October day in Pennsylvania, a few weeks before Halloween. Lori and I enter Hotel Saxonburg under a swinging sign that proudly reads: Fine Dining & Elegant Rooms Since 1832.  The 200-year old hotel has charm, history, and an unsettling reputation for being haunted. We are about to spend the night here – completely alone! (Cue scary clap of thunder.)

    When I started this blog, I wanted to include some of my 2020 travel adventures. The year looked promising with trips to Budapest, Vienna, Bratislava, and Alaska planned. Not to ruin the ending, but – all canceled.

    Never fear, however! I dug up a story from my past with special significance as Halloween is only a few days away. A haunted hotel, paired with a windy, snow-blown night. What could be better? I hope you enjoy.

    Lori and I were in Saxonburg, PA, to take a food tour. It was a birthday present from Lori, who knows me well. Mix food with a little history, and I’m pretty darn happy.

    A brief history before I continue – Saxonburg was founded by John Augustus Roebling.

    John Augustus Roebling designer of the Brooklyn Bridge

    He was an engineer turned farmer who wanted to build a German settlement in the western part of Pennsylvania. It was a bad time to be a farmer, and the Panic of 1837 pushed Roebling back into engineering, where his claim to fame was designing the Brooklyn Bridge.

    A black Brooklyn Bridge outlined by an orange sky and moon

    Unfortunately, he didn’t live to see it built. He died from tetanus after his toes were crushed by a ferry and then amputated—a scary story in itself.

    Back to Hotel Saxonburg.

    We are led up the stairs to our elegant room by the friendly manager. The hotel’s second floor consists of six bedrooms, each decorated to preserve an 1800’s feel. Historic? Yes. A little creepy? You bet!

    As we walk down the corridor to our room, I notice that each room’s door is wide open, giving us a view of the dark interiors. Each room looks like it would have nearly 200 years ago. I half expect to see guests sitting on the antique beds, dressed in 1800’s garb, but they are empty.

    We then receive news that makes my blood turn cold and raises the hair on the back of my neck. There is a communal bathroom. (Cue scary clap of thunder.)

    The manager tells us that we will be the only guests in the hotel during the night. And once the bar staff leaves at 2 am, we will be all alone in the building.

    We spend the evening dining out and then return to the hotel bar where a friend’s band is playing – a strange coincidence. All of our cares melt away as we enjoy the festive atmosphere in the warm, cozy room.

    The band finishes up about midnight, and the bar starts to empty. We decide to call it a night and walk up the stairs to our room. I try to suppress the thoughts that keep entering my head – rumor has it that the Hotel Saxonburg is haunted.

    Throughout the years, there have been eerie reports of objects moving mysteriously, names being called by an unknown voice, and ghostly sightings of people dressed in clothing from the 1800s. The hotel has even been the subject of an investigation by Steel Town Paranormal. The following video was filmed in the Hotel Saxonburg as the group tried to unearth evidence of a paranormal presence. Trust me. You have to watch this, and it’s less than 90 seconds long. 

    Terrifying! After watching this video, we made sure to keep flirtation to a minimum during our trip and create an especially dour atmosphere.

    Late in the evening, one of the scariest moments of our stay occurs. Lori exits the bathroom after getting ready for bed and walks across the hall to our room. She feels a presence. Out of the corner of her eye, she sees a dark figure in one of the empty hotel rooms, slowly rocking back and forth in an antique chair. A blood-curdling scream rises in the back of her throat until she realizes it’s just me messing with her. Ha! Sorry, Lori.

    I awake at three in the morning, and I am greeted by silence. The buzz from downstairs is gone. We are the only souls, I mean people, left in the hotel.

    The silence is all-encompassing, and I have to go to the bathroom.

    I arise from the warm bed and shuffle toward the door. I stumble into a chair that has been wedged under the doorknob. I later find out this was Lori’s work, but at the moment, my sleepy mind wonders if this was a ghostly act.

    I am in the bathroom, and I look out the window. Snow is building up on the frame, and wind rattles the glass. There is a dripping sound from an unknown source.

    I wash my hands, turn off the light, and enter the hallway.

    A long scary hallway
    Not the actual hallway, buy a close approximation.

    My eyes struggle to adjust to the darkness.

    There’s a light switch somewhere, but I can’t find it.

    The floorboards creak.

    The wind’s howl intensifies.

    I cross the hall and reach out for the doorknob to our room.

    To my right is the long hall filled with open doors.

    I don’t believe in spirits, ghosts, or apparitions, but…

    If I was ever going to have a run-in, it would be now.

    My heartbeat picks up.

    I slowly turn my head.

    And glance down the hall.

    Darkness.

    Silence.

    Nothing.

    I sigh with relief and enter our room, climb into bed, and drift off to sleep.

    The Hotel Saxonburg may be haunted, but we were spared during our stay. However, the hotel is on the creepy side when you’re the only guests in a 200-year-old building on a windy, snowy night. I will always look back fondly on our trip to Saxonburg. And while I won’t avoid haunted hotels in the future, I will do my best to avoid repeating the most terrifying part of our adventure – booking a room with a communal bathroom! (Cue scary clap of thunder.)

    I hope everyone has a – Happy Halloween!


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    Financial Advisor David Tuzzolino

     

    David Tuzzolino, CFA, CFP®, is the Founder and CEO of PathBridge Financial, a firm that specializes in providing comprehensive financial planning and investment management services for clients that are nearing retirement and love to travel.

    The Problem with Living on Social Security Alone, Longevity and Retirement Savings Disconnect, and Missing the Airport – Links

    A wooden bridge spans a small brook with colorful trees in the background

    I know you have other things on your mind right now, but don’t forget about retirement planning. If your only income is from social security, it’s going to be a lean ride.

    Are you missing the airport? Yeah, me too. There’s something about the energy, the potential, the anticipation of the next adventure.


    Retirement

    Can you live on social security alone? – (USA Today)

    Of course, it depends. But if you do, don’t expect much extravagance in your life. How you can supplement your retirement savings.


    The retirement savings disconnect – (Barrons)

    “Americans’ optimism about their longevity comes at a time when planning for retirement has become more complex.”

    Along with this longevity comes a healthier and more active retirement. Make sure your savings keep up with this new reality.


    Travel

    A lifelong traveler takes a journey inward – (The Washington Post)

    I hope that we will be able to travel, interact with, and witness the world again shortly. When we do, it will certainly seem strange. But when has travel not been strange?


    There’s a second wave of COVID-19, so be careful where you travel – (Chriselliotts.com)

    Use common sense and avoid crowds. The article contains some useful links if you’re researching a location. It’s going to be a long winter, folks.


    Missing the airport – (The Points Guy)

    I miss the buzz of an airport. I miss the mass of people in motion to see loved ones or going on vacation. I miss the anticipation of far-flung destinations. Now, if I could only get there without going through a metal detector.  


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    Financial Advisor David Tuzzolino

    David Tuzzolino, CFA, CFP®, is the Founder and CEO of PathBridge Financial, a firm that specializes in providing comprehensive financial planning and investment management services for clients that are nearing retirement and love to travel.

    Is It Ever a Good Idea to Buy a New Car?

    Dark car park entrance exit

    I feel like I need to whisper this to you in a dark parking garage with my face obscured by shadows, but, “I’m a financial advisor who buys new cars.” And I will argue that, yes, sometimes buying a new car is a good idea despite the many financial pundits that will tell you purchasing a new car is one of the worst financial mistakes you can make. Here are the top five reasons you should consider buying a new car instead of one that is used.

    Getting Exactly What You Want

    Have you ever found yourself wandering the aisles of a used car lot or scouring a website searching for the perfect car? Rarely do you find exactly what you’re looking for. One car has every feature you could dream of, except it has a metallic-mustard paint job. Another vehicle is perfect in every way, except your history of backing into poles makes the absence of a backup camera a non-starter.

    Buying a used car is often filled with compromises. However, if you decide to buy a new car, you can have it delivered the exact color, and with the exact features, you desire. Some of these choices can also save you money. Buying a used car can result in being stuck with expensive options you don’t necessarily want.

    My last car-buying adventure was eight years ago. Three decisions I remember clearly were All Wheel Drive (AWD) or Rear Wheel Drive (RWD), standard or automatic transmission, and whether I needed a navigation system or not.

    I bought a new Lexus, and the experience is still fresh in my mind. One feature I was happy to skip was the navigation system. I remember staring at the price tag and then my phone. Price tag. Phone. I couldn’t justify the price versus the free navigation system in my hand. Thank you, Google! I’m not sure exactly how much I saved in 2012, but if you decide to skip the navigation system on a new Lexus IS today, you’ll save $1,670.

    Most of the cars on the dealer lot had AWD. Safer? Perhaps, but also more expensive. I could have saved approximately $2,000 by selecting a RWD car. For someone who has a short, or no (thank you coronavirus), commute, and rarely needs to drive in poor weather, this option could be attractive.

    My first car was a 1976 White Datsun B210, and it had a stick-shift. I still have an affinity for manual transmissions and only recently bought an automatic.

    Stick shifter in black and white

    You can save between $1,000-$2,000 by going old school. Unfortunately, the stick-shift is dying out, but it’s another example of a feature you can select in a new car to lower the price.

    There are dozens of places to save money on a new vehicle. Don’t like leather seats? Order cloth. Would you be happy with a 4-cylinder? Downgrade from the V6 engine to save money. Not everyone wants a moonroof. If you can do without, you might be able to save some money.

    All of these extras add up, and if you are buying a used car, you will be stuck with the features already decided for you. If you order a new car, you can drop unwanted options and potentially save thousands of dollars while getting exactly what you want inside and out.

    A caveat here is if you strip out options that everyone else wants, you’ll likely get a lower price when you sell your car. However, if you’re like me and you plan to drive your new car for a dozen years or more, this will matter less. And if your new car is perfect in every way, you’ll be less likely to begin eyeing up the new models after a few years.

    Technology

    The speed of technological advances is accelerating in society, and new cars are no exception. There may be advanced features on the latest model that are absent from older cars – technology that is important to you. One area of emphasis is safety. New technologies include lane-keep assist and automatic emergency braking. If this is a brand-new feature and you want it, buying a new car is the only way to go.  

    Is parallel parking the bane of your existence? Would you rather walk three blocks to pay a valet $30 to avoid parallel parking for free in front of a busy restaurant? Self-parking technology alone might be worth buying a new car if older models don’t have it. There are many features that may make purchasing a brand-new car attractive depending on the model you’re considering. 

    Low Interest Rates

    The average credit score in the U.S. has been around 690-700 over the last 15 years. And according to Bankrate, the Annual Percentage Rate (APR) people pay for a new car with a score in the range of 661-780 is 4.68%, versus 6.04% for a used car.

    As reported by Edmunds, the average length of new and used car loans have increased over the last decade to 72 months. Let’s take a look at the overall cost difference of buying a new versus a used car.

    The best-selling, non-pickup truck for 2020 is the Toyota RAV4. Using pricing and depreciation data from Caredge, I calculate the total cost with a 72-month loan to be $34,094 for a new RAV4 and $30,998 for a one-year-old model. That’s a difference of just over $3,000 for the six-year length of the loan.

    White Toyota Rav 4

    The loan’s overall cost for the used RAV4 was lower due to a lower purchase price, but the used car owner paid over $600 more in interest charges due to a higher rate. Always keep in mind that the APR difference between new and used has a cost.

    If you have excellent credit, there are often opportunities throughout the year to get an even lower rate. For example, Toyota is offering 0% APR, as I write this article, for 60 months and 2.9% APR for 72 months. You won’t often see rates this low on used cars. Just remember to always check the fine print on any loan.

    Negotiations

    This may be the best reason of all to buy a new car. It’s not a monetary win, but there is a tremendous value gained by not having to haggle with a used-car salesperson. I have accompanied several friends to buy a used car and my experiences, unfortunately, matched the used-car salesperson stereotype. I sat through high-pressure sales, a focus on payment and not price, and frequent huddles with the manager.

    The difficulty of negotiating the price of a used car is – no two are alike. Options, condition, and mileage differ between every vehicle. These differences put you at a negotiating disadvantage.

    The beauty of negotiating for a new car is each one is identical. Yes, options can vary, but each car you purchase should be in showroom-floor condition with a handful of miles. And if you can’t find a vehicle with the exact options you want, you can order a new one from the factory. This uniformity allows you to more easily negotiate the price of your new car with several dealers.

    Not a fan of the negotiation process at all? Let me introduce you to the Internet Sales Manager. Without even stepping into the dealership, you can get the price for the car you want simply by sending an email. Contact several firms that each have the same car (or can get you the car), and lower your price by having them bid against each other. Only when a price is finalized will you have to stroll into the dealership – your negotiations complete.

    Admittedly, you can also negotiate used-cars by email. However, negotiations tend to be more difficult when you’re not comparing apples to apples.

    Private Sellers

    If you plan to buy a used car from a dealer, this won’t apply to you. However, to get the best price on a used car, you’re going to have to buy it from a private seller.

    Safety is always a concern when buying a car from a private seller. A dealership may have its faults, but worrying about your security isn’t one of them. There is no telling who is on the other end of a private sale.

    A man in a gray suit menacingly points a banana

    You’re also going to have to take care of the transfer of ownership paperwork and complete it yourself. The details for each state will vary, but most involve some legwork. In Pennsylvania, you will need to take a trip to the Department of Transportation as an agent will have to witness the transfer.

    When you’re buying a used car from a private seller, you have little recourse if it turns out to be a lemon. You want to have it inspected by a mechanic you trust and ask a lot of questions about its history. Obviously, this involves time and money.

    Is a new car from a dealer looking better to you now? You can avoid most of the private seller headaches by purchasing a used car from a dealer, but you’ll pay extra for the privilege, and the spread between new and used car pricing will narrow.

    Summary

    Don’t immediately assume a used car will be the right choice for your next car purchase because that’s what you’ve heard from the experts. Investigate the used-car inventory in your area. Compare new and used-car pricing. Then compare these options with ordering a car from the factory with precisely the features you desire. Weigh the differences in pricing, interest rates, technology, and your comfort level with negotiations to make your final decision. You may find that by cutting a feature you don’t want, sticking with a car that depreciates slowly, and scoring a low interest rate, a new car will be just as, or more, attractive than a used car.


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    Financial Advisor David Tuzzolino

     

    David Tuzzolino, CFA, CFP®, is the Founder and CEO of PathBridge Financial, a firm that specializes in providing comprehensive financial planning and investment management services for clients that are nearing retirement and love to travel.

    Fall Foliage 2020

    A covered path bridge surrounded by an explosion of color fall foliage

    Fall is in the air and I’m in planning mode for a socially-distanced tour of Gettysburg. We should be treated to a colorful ride as we head east out of Pittsburgh. Pennsylvania is known for having the longest fall foliage season on earth so I became inspired and put together a short fall-foliage resource guide. Retirement links will return next week. 


    Travel

    This travel portion is all about fall foliage. I am planning a trip and it’s just about the perfect time of year to see the changing colors in Pennsylvania. My apologies to everyone that missed the peak season in their area, as I am a little late with this.

    Fall foliage map – (Smokymountains)

    A phenomenal map of the entire United States that predicts the best time to travel to each area. You can change dates to move forward in time, and the map shows detail down to the county level.  The site also has some basic science on the entire process. Memorize it, so you don’t look like a fool when a three-year-old asks you about Chlorophyll.


    A guide to every state’s fall colors – (tripsavvy)

    Every state’s peak time and the colors expected to make an appearance are listed. Each state’s fall foliage hotline is also listed – who knew such a thing existed?


    Places to see stunning fall colors – (Recreation.gov)

    Which locations are worth visiting? Here’s a list with national parks heavily represented.


    11 fall foliage road trips to take in 2020 – (Jetsetter)

    If it’s epic road trips you prefer, here’s eleven of them that won’t disappoint. Make sure you talk someone else into driving, so you don’t miss a thing.


    Planning a Trip During a Pandemic – It Just Might Make You Feel Better – (PBF)

    My research for this Gettysburg trip is what motivated me to compile articles on fall foliage. Are you feeling down? Try planning a trip; it will likely make you feel better.


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    Financial Advisor David Tuzzolino

    David Tuzzolino, CFA, CFP®, is the Founder and CEO of PathBridge Financial, a firm that specializes in providing comprehensive financial planning and investment management services for clients that are nearing retirement and love to travel.

    Planning a Trip During a Pandemic – It Just Might Make You Feel Better

    Pandemic

    Lori and I have named the two chipmunks that jump through the flowerpots on our patio Blue and Schnickelfritz. This is what passes for our entertainment during the pandemic. It’s time for a vacation.

    Chipmunk eating a blue flower

    It’s been about a year since I planned a trip that wasn’t canceled. It was New York City during Christmas, something I highly recommend you do once in your life. We took a short trip to Ellicottville, New York this summer, but Lori did most of the planning.

    I’m excited to begin!

    Planning a Trip and the Joy it Brings

    “To the most beautiful moment in life – better than the deed, better than the memory – the moment of anticipation.” – Jacques from The Simpsons

    Jacques wasn’t talking about taking a vacation, but he might as well have been. There are more than a few studies pointing to the pleasure of merely planning a trip. Often the positive feelings of planning a vacation can be the same or greater than the journey itself. From personal experience, I agree.

    Gettysburg

    Where to begin? The destination.

    As soon as Lori suggested Gettysburg, I knew we had our answer. It checks all of the boxes. There’s a historical component that I find fascinating, it’s within a four-hour drive, and neither of us has ever been there. Best of all, this may surprise some, but – the whole darn Battle of Gettysburg took place outside! Social distancing? Not a problem when you’re hiking and reading plaques in a vast field.

    Gettysburg

    Admittedly, my knowledge of the famous civil war battle is limited, but I’m ready to correct this. Before most vacations, I try to read a fiction and a non-fiction book about the destination. And when I don’t feel like breaking out the Kindle, I like to watch movies, documentaries, and YouTube videos to get a feel for the history, people, and culture of the place I am going. For this trip, my travel-media list looks something like this:

    • The Civil War by Ken Burns (at least the episodes that directly deal with The Battle of Gettysburg as I’ve seen it before and this is just a refresher)
    • Gettysburg – the 1993 movie
    • Gettysburg – the non-fiction book by Stephen W. Sears
    • The Killer Angels – the Pulitzer Prize-winning novel about the battle by Michael Shaara

    At the same time that I’m diving into the historical part of Gettysburg, I’m reading through reviews, blogs, and travel guides to get an idea of what to expect on our trip. Where to stay? What sights to see? Where to find a good cheesesteak? (I can’t be this close to Philly without indulging.) Yes, I’m the analytical type, and by the end of this process, I’ll have an extensive spreadsheet.

    I’m not militant enough to put together a schedule of events with a strict timeline, but I like to have options. I want to know what restaurants, sites, or tours are open each day and what hours they operate. I also created a resource list for planning a trip in this uncertain time, which you can access here.

    Plan a Trip Today

    “This virus can stop our travel plans, but it cannot stop our travel dreams.”- Rick Steves

    Travelers – I encourage you to take dreaming a step further.  Begin the planning process. Immerse yourself into a good book, movie, or vlog about your dream location. Plan for the trip you might take next month. Plan for the trip you might take a year from now. Trust me (and academia); you’ll feel better.


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    Financial Advisor David Tuzzolino

     

    David Tuzzolino, CFA, CFP®, is the Founder and CEO of PathBridge Financial, a firm that specializes in providing comprehensive financial planning and investment management services for clients that are nearing retirement and love to travel.