161–170 of 185 posts
The #1 expense over your lifetime won't be your house, your entertainment, or your cars. It will be TAXES. If you build a career path that can take advantage of tax breaks you wind up with a huge advantage from the start. For tech entrepreneurs - focus on building your enterprise value. Reinvest profits into GROWTH so that you wind up paying the bulk of your taxes in capital gains vs. personal income tax. On $1m or 2…
Earlier quoted context omitted.
For what it's worth, I just bought a new car for $35k. Came with a 5 year interest free loan with nothing down. If you can get that type of loan, you don't want to pay it off quickly.
You bought a $35,000 depreciating asset on finance, and one that is substitutable by something for $5000. If you had to sell the car in a year's time then it's very likely that you may not even make back the value of the loan. Meanwhile you could have taken the $30,000 difference, and automatically paid those earnings that would have otherwise paid off the loan into savings, a 10K or a start-up. Yu could also have pu…
You might be able to get that money other way but it will take so much time that you won't even have few minutes for yourself to brag about your success on reddit.
Earlier quoted context omitted.
> you have to be pretty lucky if driving a 20+ year old car is a net gain. I can't imagine a 20+yr old car which is a gain, and I'm a fan of classics and owner of an '84 BMW. In terms of money eating vintage cars are worse than gold-diggers unless you let them rot. One must be overentusiastic by their hobby not to see that's a sinkhole, been there done that ;)
I drive a 22 year old nothing special, original owner. That's four cars that I didn't buy, at 5 years, 10 years, 15 years and 20 years. Four expenses avoided, four consumptions of steel and other resources avoided. I get 36 MPG, plus or minus a few. I don't know if that's lucky, but I think it's worked out very well. I am, however, not rich.
Earlier quoted context omitted.
Kids are cool to have whether you have money or not. Well, if you decide to have kids, anyway, and are responsible for the act of raising a family, either poor or rich or somewhere in between, then its great whether you're saving for your first million or not saving at all .. no amount of money will ever buy the pure joy of raising ones family and watching the growth daily, hand in hand. Its something all humans have…
Kids are cool to have? Nah, I have too much emotional burden to even become a father figure. It is a lot of responsibility, and I bet the joy of having kids is priceless. Cool? not so much.
Earlier quoted context omitted.
I blame politics. A lot of young people are emotionally invested in the idea that "the System" is responsible for some people being poor and others being rich. If you acknowledge that some choices are good and others are bad, it challenges the view that wealth is predetermined and that income inequality is caused by fate/bias.
I don't think blaming it all on good choices/bad choices is any more reasonable than blaming it entirely on "The System". They both play a role in where someone will end up.
But if you spend a lot of time arguing that fate/bias determines a person's life, you are going to be less likely to invest the effort in making those good choices. Optimism and pessimism can infect a culture or an age. Lots more things are possible in ages of cultural optimism, it's self-reinforcing! We're definitely entering an age of pessimism.
Earlier quoted context omitted.
There's a middle ground between not spending and spending extravagantly. So many people with large incomes just waste it away and end up with nothing at the end. We're not talking about a single $500 iPad. We're talking about a $500 night at a club.
How is it even possible to spend $500 in one night at a club? That's 50 drinks, at least!
Earlier quoted context omitted.
with cars you can just buy them used and sell them before they depreciate too much. Buy a 3 year old car, keep it for 1-2 years, then sell it. (if that's still too rich for your blood...get a 5 year old car and keep that for 2 years) Just look at the cars as the cost to own...not actual price you pay. So even if a car depreciates 20% in that time period, you can still drive something decent. A $10,000 used car...will…
While your calculation is correct, you do not include a rather important fact. Owning a car which you intend to sell in a couple years is a risk. Even though the cost of ownership of a $100k car and $40k car might not be much, it will turn out to be significant at the moment you crash it. Which will then inevitably lose you the full value.
but a lot of times the crashes don't affect the value that much...not many people actually use carfax.
Earlier quoted context omitted.
with cars you can just buy them used and sell them before they depreciate too much. Buy a 3 year old car, keep it for 1-2 years, then sell it. (if that's still too rich for your blood...get a 5 year old car and keep that for 2 years) Just look at the cars as the cost to own...not actual price you pay. So even if a car depreciates 20% in that time period, you can still drive something decent. A $10,000 used car...will…
While your calculation is correct, you do not include a rather important fact. Owning a car which you intend to sell in a couple years is a risk. Even though the cost of ownership of a $100k car and $40k car might not be much, it will turn out to be significant at the moment you crash it. Which will then inevitably lose you the full value.
Not even close. Insurance will reimburse you for the loss (minus a deductable).
Earlier quoted context omitted.
6) Avoid expensive hobbies/activities that consume a lot of time and don't contribute much to your marketable skills. If a hobby requires spending a considerable chunk of your monthly income, reconsider whether it's really worth it. I only have an issue with this remark. But perhaps it's because when I "reconsider whether it's really worth it", I consistently find that yes, yes it is worth it. I rather enjoy extreme…
The real question I struggle with is related to this. Quite simply, what use is a million bucks just sitting in the bank? Once you've got your retirement, mortgage and rainy day fund covered, money you never use is a piece of your life you traded away for... nothing. So I guess what you could say is, if you grow to a million in net worth because you have a booming business with great returns, that's wonderful. But I…
(Back of envelope: Suppose you reckon you can safely spend 5% of your initial retirement fund per year, without running out before you die. And suppose you want $50k for medical emergencies, because you're in the USA and aren't sure Medicare will (1) still exist and (2) cover everything. And suppose you want $30k/year of effective income after retirement, which doesn't seem insane. Then you need $650k in that fund. Note that that 5%/year figure depends on the overall growth of the economy and how long you expect to live after retirement.)
Yes, saving a lot of money can just be pointless avarice. But I think the level at which that becomes a reasonable suspicion is rather higher than "total assets of $1M".