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Rich Jeepers

txj2go

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All comes down to what you consider wise use of your money.
My wife tends to prioritize house payments, insurance payments, car payments, grocery bills, ...

It’s true that people allocate money towards what’s important to them. For example, keeping my wife happy by spending all my money on her is important to me
We do spend some money on home improvements. We put new kitchen cabinets in our 35 year old house and next week we start painting the dining room, living room and den.

I started work at age 15 and I've worked ever since, even during high school and college. I got a good job out of college, saved when I could, didn't spend excessively. I've always driven old cars that I bought used. I don't have any expensive hobbies, no boats or motorcycles, I guess it's all relative- my hard work allowed me to spend $30k on a used JLU Sport, and have a little left over to pay for gas. Oh and do my mods- I spent $560 on tires and lift. In the 15 months I've had it I've made 2 trips to Utah to do trails and 3 trips to Colorado to do trails. And on those trips I was camping and eating PBJ sandwiches, I wasn't doing hotels.
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WilhelmSR

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Don't think that some of these people are in serious debt for what they have done to their Jeep. This IMO is the worst thing to do. Be smart and reasonable. Never charge what you can't afford. Set a budget, you are young. Financial wealth doesn't come to most people until 30+.
 

Walker Texas Wrangler

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Since this is open forum, I state that this is something I completely disagree with. Cash is not always king and certain not in this economy. Economy is plush with money right now and actually debt is the way to go now. To summarize and not get into too much detail, you don’t want too much cash at the moment with the inflation rate being crazy. Take on as much as debt as possible. In the mortgage business you would be ahead of you took on debt for at least the near future. Good luck and cheers.
Either way. Debt or cash Jeep’s are fun
Cash will always be king, but I get what you are saying.....money is very cheap to borrow right now. There have been many times where I took advantage of very low or 0% APR. I've financed my Jeep at 2.19 APR and my Mortgage is 2.125 APR. But, there are plenty of people who fall into your line of thinking and get in over their head. So let's just say that debt is cool for you, but it's not for everyone. The same can be said for cash. But, I started my business with cash and run on cash. I don't take on debt and buy my materials/hardware with straight cash. I could have a nice line of credit, but I don't want to work that way. But I do have a personal line of credit that I am responsible enough to keep for emergencies. If you want to be particular, in this current economy, you should be throwing some money into precious metals or investing in commodities.
 
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Walker Texas Wrangler

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You and I should talk... ;) I work in the Graphics industry, we are a commercial offset & digital print shop with amazing capabilities...


My wife and I both came out of prior marriages where the spouse didn't contribute financially AT ALL to the marriage... Now, we enjoy buying each other things and taking trips, spending time together, etc.
I'm in sales, and she's a Traumatic Case Manager at the local hospital.
That's right up my alley. I have a couple of printers that I do regular work for. Turns out the young guns don't have as much experience getting files fit for print, that gets me some good business sent my way. I worked for a commercial printer for a while and had to do my own pre-press. I was working next to one of the 3 first Indigo presses in North America back in 2000. Check out my website in my profile, shoot me a message!
 

Andrews jl

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It’s Miller time!
eat me? are you that guy that eats all those hot dogs?
Not really a hot dog eater… so, I’m going to say no. You must be thinking about someone else..
My moneys earned the old fashion way
 
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Andrews jl

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It’s Miller time!
And this has been one of the “myths” of traditional 401(k)s all along……

when you put money into one, you might have a marginal rate of 15 or 20 or 25%…… so, that’s tax deferred….. cool.

now, 40 years later, your investments have grown and you have a TON of capital gains inside the 401(k) but….. but….. oops….. it’s all going to come out as Ordinary Income at a rate (thanks to min distribution calculations) that may actually be HIGHER than the original taxes “deferred’……. I.e. “pay less taxes now to pay MORE in the future.”

you are trading saving taxes now on “small amounts” but Not getting capital gain treatment on (potentially large) gains in the future.

don’t get me wrong — 401(k)s, if available to you, should be used — ESPECIALLY if there is an employer match….. but many folks would benefit from some tax planning regarding roth conversions, back doors, etc. the new 401-Roth might complicate the situation further for younger workers.
I’m wondering if you are considering the tax rate difference between what you’re paying now. Versus what you will pay when you retire. When you retire you’ll probably have much less debt, your kids will be grown and moved out,your mortgage will be paid off. Your cell phone bill and car insurance will be cut in half ( kids!,) and your real expenses will be greatly reduced.
For example, If you’re working and earning $120,000 per year you can expect the federal tax rate on $120,00 to be about 28.6%…the federal tax rate on 45,000 is about 18.7%
That’s a big difference! ($34,300 vs $8400) per year
There’s your jeep payment!
Of course I could be way off on these assumptions..
Just my .02
 

Steve JLUR

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High School Principal. I’ve been saving for a lift and bigger tires for awhile. I live vicariously through the posters here and their endless supply of money.
Or loads of credit…
 

Beaching631

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Wife and I are in our early 40's. Both of us work, and I literally have 3 other part-time jobs in addition to my "real job," Those side gigs pay for vacations, restaurants, the Jeep, etc.
Something that a lot of people overlook is that my JLUR is the result of a cycle of purchasing, taking care of, and trading-in several vehicles that retained their value. Went from a Ranger to a Tacoma, to a Tundra, to the Jeep. Each trade made the next purchase cheaper and cheaper.
Long Island is extremely expensive so we do have a lot of home debt, but the good news is that we own more than 50% of the house at this point.
OP is in his 20s right? I would echo the repeated advice in this thread of putting as much as possible into 401k/403b, also putting some cash into a brokerage account and buying some ETFs and blue-chip stocks, putting more cash aside as an emergency, etc.
 
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MSparks909

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30, divorced/no kids, pilot, own some real estate rental properties too. Not super debt adverse (hence the rental properties), selling my paid off current DD (14’ F250 6.7) for my 392XR. Do I need a $88K Jeep? Absolutely not. Do I want it? Oh yes.

Can’t take $ with you when you die. Passive income is wonderful if you can work it into your life. Start small and work up!
 

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WranglerAz

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But I will say this, it's not necessarily how much money you make, it's what you do with it. Cash is king. Prior to my new JLUR, I drove a Honda Accord for 13 years. I hated it, but I was willing to sacrifice for the greater good.
Well said, congrats to you. I drove a 2000 TJ for 18 years, while too small for my comfort, I saved money. I was able to pay cash for a 2018 JLUR, and then give my TJ (just 90K miles) to my daughter when she graduated university. It wasn't important that I saved and bought, the coolest part is she learned several life lessons from this to use in her own life, and thus found a husband who saves and likes Jeeps.
 

wibornz

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As long as I can physically work, don't have any intention of retiring - I am a PCD machine tool salesman/application guy. Love doing what I do.
Are you aware that there are many cool things to do other than working that you can't do while working?
 

basinite

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Most people you think are Rich are actually "Fake Rich". The wealthiest people I know give off an appearance of simple middle class (usually houses excluded), while a lot of middle class people I know attempt to give of the appearance of being Rich.

This is typical and pervasive in the American culture, hence the term "Fake Rich". The sad part is, these Fake Rich people are 1-2 pay checks away from not being able to meet their monthly financial obligations.

Dave Ramsey did the largest study on millionaires ever produced. Guess how many millionaires bought new vehicles??? Almost none. They buy vehicles that are a couple of years old and let the Fake Rich middle class take the depreciation hit.

If you want to build wealth, start creating passive income streams; real estate, equities, limited partnerships and etc. Do not fall into the middle class trap of trying to impress others with being Fake Rich. Nobody cares about your designer clothes, latest iPhone, fancy jewelry, eating out adventures and never ending vacations.
 

Dkretden

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I’m wondering if you are considering the tax rate difference between what you’re paying now. Versus what you will pay when you retire. When you retire you’ll probably have much less debt, your kids will be grown and moved out,your mortgage will be paid off. Your cell phone bill and car insurance will be cut in half ( kids!,) and your real expenses will be greatly reduced.
For example, If you’re working and earning $120,000 per year you can expect the federal tax rate on $120,00 to be about 28.6%…the federal tax rate on 45,000 is about 18.7%
That’s a big difference! ($34,300 vs $8400) per year
There’s your jeep payment!
Of course I could be way off on these assumptions..
Just my .02
I think that your hypothetical numbers actually show what I am trying to articulate. the Dollar that went into your 401(k) 40-years ago likely went in at a marginal tax rate of 15% because you were young and not earning much. It doubles 4x during that period. All of that “capital gain“ which should be taxed at 15% cap gain rate (using your example above) is actually taxed now on the margin at ~19% Since it’s all “ordinary income” (Note, I think that the hypothetical person above has a marginal tax rate of 22% for 2021….. https://www.morganstanley.com/content/dam/msdotcom/en/themes/tax/2021_federal_tax_tables_final.pdf) So, your person above is paying MORE tax on the original dollar invested AND paying more tax on the “capital gain” since it’s ALL treated as ordinary income.

there are a million ways to work the numbers here and all depend on personal circumstances but consider this:

many single Americans will have income of less than $40k per year in retirement. If that’s true, their marginal ordinary income tax would be 12%….. all money coming out of their 401(k) will be treated as ordinary income. BUT, if They were allowed to treat that income as capital gain (which most of it is), their tax would be ZERO On most of that money. So they pay more tax….. then flip the script and consider those folks with a much larger 401(k) and other investments……. The same issue arises, the RMD of a 401(k) along with other sources may put them into the 28% or higher bracket in large part because the 401(k) RMD is all treated as ordinary income.

don’t get me wrong, a traditional 401(k) is a solid choice for folks, especially with an employer match and I think all folks who have the option to signup for one should….. Roth 401(k)’s help to fix this taxing “problem’ but there are likely complexities there too.

hope all of that makes sense and, OP, sorry for the hijack.

For the record, I’m an early retiree from a Fortune 500 having spent years in M&A and Venture Capital.
 

Ridgway Jeeper

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Where I live we have a LOT of "Actually Rich" people. Ralph Laurens ranch is down the road, Charlie Ergen, Dish Network CEO has a ranch down the road, Telluride is just over the hill and Oprah is building a 50 million dollar plus home right now. Average price of a home on the market in my small county is closing in on a million and a half. Other than Ralph, who is a massive car enthusiast, almost nobody is running around flaunting wealth. Newer vehicles for sure, some Tesla's for show because they really don't work well in rural areas but given the massive amount of wealth that I know exists, the point is well taken that they often are not the ones with a pile of expensive toys. There are tons of Jeeps around but most of the modded up ones are coming in from other places and are not owned by multi millionaires but working people with passion for their hobby.
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