BigOxley Posted September 10, 2015 Report Share Posted September 10, 2015 im in "step 6" of baby steps still trying to figure out what to do: pay off the house like crazy and living like a monk or living normally and paying off the house in 15 years. couldn't imagine spending over $30k for a car/truck right now Quote Link to comment Share on other sites More sharing options...
Supplicium Posted September 10, 2015 Report Share Posted September 10, 2015 Yes, Savings account. Mainly because I wanted to keep it easy assess to pay for school. Needless I kicked ass in school and got scholarships and stuff and have needed very little of it. Maybe 2-4 grand at certain points that has basically been replenished from scholarships. I am looking at buying a house in the next 6mo or so... but debating if I should dump it into a Mutual fund? I do have a IRA, but I am not sure that is doing anything. When you open an IRA are you suppose to invest that into something? I am rather lost on all of this. I bank though USAA if it matters. IRA is an account not an investment. You have to fund the account then make investments. Roth means the money you put in is already taxed before the investment is made. That way when that money grows over 30-40 years when you are ready to pull it out and spend it the money comes out tax free. Traditional IRAs the money is put in pre-tax from your paycheck (more $ upfront to invest ) but when your 100$ turns into 1000$ over time and you go to pull that 1000 out it is taxed. So when you open the IRA account did you set up funds to be transferred every so often into the account? Did you submit investment choices like mutual funds or index funds? If not you need to setup fund transfer schedule that you can work with and choose investments. I suggest a Target Date fund which you just choose the year you want to retire and it manages all the investments for you or just a basic total stock fund or SP500 index fund. Remember: "The problem for millennials is it's hard to think long-term," "The unfortunate reality is that time and compounded interest are an investor's greatest asset, yet so few are able to leverage it." 1 Quote Link to comment Share on other sites More sharing options...
Supplicium Posted September 10, 2015 Report Share Posted September 10, 2015 im in "step 6" of baby steps still trying to figure out what to do: pay off the house like crazy and living like a monk or living normally and paying off the house in 15 years. couldn't imagine spending over $30k for a car/truck right now New car average cost in 2015 in the US is $33,560 The goal is to pay yourself first those payments of that 30k car then once you have it go buy that car. In my case, I made the mistake of leasing my girls car for 3 years, then had to eat the buyout bc of the .09% offer along with the car was in mint shape with only 20k miles after 3 years. So I make the 225 payment to VW, 250 payment to myself (for future car so I dont have to get loans or lease) at the same time. Over the course I now have 18k aside for her next ride. 12 or so months the 225 will go away, the payment becomes 475 to myself and in no time I will have that 40k needed for a new ride (aslong and nothing crazy happens to our Tiguan the next 2-5 years. As someone who saves a large portion of my income and strict about not touching it, there are days and months of living like a monk and others feeling more normal and even fortunate. Quote Link to comment Share on other sites More sharing options...
coltboostin Posted September 10, 2015 Report Share Posted September 10, 2015 Not so simple. The calculations that have been used aren't just what you spent but how much you make on investments. I noted that in my first reply. If you have any mechanical ability, you should never buy a new car-its a huge hit day one, and a monthly loss due to interest. Even a poor performing mutual fund will make 2-4% a year. Even if your paying a nominal 2% interest rate, you have a net loss of 6%, and that's a worst case scenario!! Unless your talking about what you make on the sale of the car? In that case I assumed it was a given in that calculation. In 99.5% of cases, the new car is still going to be the losing bet. That .5% being the people that bought a Ford GT new. Quote Link to comment Share on other sites More sharing options...
Jewtoys Posted September 10, 2015 Report Share Posted September 10, 2015 This whole conversation is going to be completely different for everyone, a pointless video. Sure if you have some knowledge and mechanical skills, you could get lucky purchasing old crap and selling it for more or breaking even. But life is short, it's nice to have something new, with a warranty, and no worries of having to dick with it when it breaks. Worrying about socking away a minuscule car payment every month is looking at it completely wrong. If a small car payment is make or break its time to focus on a different career or figure out another source of income. Quote Link to comment Share on other sites More sharing options...
Tindall2006 Posted September 11, 2015 Author Report Share Posted September 11, 2015 IRA is an account not an investment. You have to fund the account then make investments. Roth means the money you put in is already taxed before the investment is made. That way when that money grows over 30-40 years when you are ready to pull it out and spend it the money comes out tax free. Traditional IRAs the money is put in pre-tax from your paycheck (more $ upfront to invest ) but when your 100$ turns into 1000$ over time and you go to pull that 1000 out it is taxed. So when you open the IRA account did you set up funds to be transferred every so often into the account? Did you submit investment choices like mutual funds or index funds? If not you need to setup fund transfer schedule that you can work with and choose investments. I suggest a Target Date fund which you just choose the year you want to retire and it manages all the investments for you or just a basic total stock fund or SP500 index fund. Remember: "The problem for millennials is it's hard to think long-term," "The unfortunate reality is that time and compounded interest are an investor's greatest asset, yet so few are able to leverage it." So I have to be putting money into it each month in order to invest it in mutual's? I am going to have to look more into this, but you clarified what I thought was correct. Thank you very much! Quote Link to comment Share on other sites More sharing options...
RC K9 Posted September 11, 2015 Report Share Posted September 11, 2015 My dad used to do this crap though. Buy an old chevette on the cheap, drive it for a year, turn around and sell it for what he paid or more, with minimal work. Just pretty much oil changes and such. Did the same thing with a corolla, and a few others. It can work if you have some kind of mechanical inclination to do easy stuff and have an eye for a good deal. Quote Link to comment Share on other sites More sharing options...
Exodus Posted September 11, 2015 Report Share Posted September 11, 2015 My dad used to do this crap though. Buy an old chevette on the cheap, drive it for a year, turn around and sell it for what he paid or more, with minimal work. Just pretty much oil changes and such. Did the same thing with a corolla, and a few others. It can work if you have some kind of mechanical inclination to do easy stuff and have an eye for a good deal. This is how I got into cars. I started when I was 16 and just kept flipping cars for more. I've never had a car payment ever. I'm not interested in having debt lol. Some cars I bought for 800 and sold for 1k, other cars I got for 200 or even free, drove for a few months and sold for 2k. I've told these stores to my friends and they think I'm some sort of bad guy for being able to turn a profit like that. I don't get it lol They are like "I wouldn't't pay what you are asking knowing what you paid for it" As if it's some sort of crime to make money. Quote Link to comment Share on other sites More sharing options...
ForeverMaker Posted September 11, 2015 Report Share Posted September 11, 2015 This whole conversation is going to be completely different for everyone, a pointless video. Sure if you have some knowledge and mechanical skills, you could get lucky purchasing old crap and selling it for more or breaking even. But life is short, it's nice to have something new, with a warranty, and no worries of having to dick with it when it breaks. Worrying about socking away a minuscule car payment every month is looking at it completely wrong. If a small car payment is make or break its time to focus on a different career or figure out another source of income. Yea I don't understand all this. Why can't you buy a new or used car and still put money away? So many other factors to life and what people are spending money on other than some small car payment. The same people driving around in beaters making $200 flipping a car could be dropping $500 at bars every month. Although money spent at on alcohol is always worth it. Quote Link to comment Share on other sites More sharing options...
zeitgeist57 Posted September 11, 2015 Report Share Posted September 11, 2015 The same people driving around in beaters making $200 flipping a car could be dropping $500 at bars every month. LOL. I do think about the "bravado" that comes naturally with these "living well" discussions... Be Tim: talk about making $24k on money that could've gone towards a car, then blows $32k on landscaping and a camera. Quote Link to comment Share on other sites More sharing options...
TTQ B4U Posted September 11, 2015 Report Share Posted September 11, 2015 LOL. I do think about the "bravado" that comes naturally with these "living well" discussions... Be Tim: talk about making $24k on money that could've gone towards a car, then blows $32k on wife and kids. Fixed Quote Link to comment Share on other sites More sharing options...
RC K9 Posted September 11, 2015 Report Share Posted September 11, 2015 This is how I got into cars. I started when I was 16 and just kept flipping cars for more. I've never had a car payment ever. I'm not interested in having debt lol. Some cars I bought for 800 and sold for 1k, other cars I got for 200 or even free, drove for a few months and sold for 2k. I've told these stores to my friends and they think I'm some sort of bad guy for being able to turn a profit like that. I don't get it lol They are like "I wouldn't't pay what you are asking knowing what you paid for it" As if it's some sort of crime to make money. People are ignorant haters. You getting a good deal and being wise is not a bad thing. They are just jelly that they aren't as resourceful. That's why I never tell people what I pay for something if I know I am going to sell it. It's none of their business what I paid and has no bearing on the value. That's why you have never had a car payment and they do. I do have car payments. Am working on keeping that from happening again. And I still applaud you. That's how it should be done. Quote Link to comment Share on other sites More sharing options...
kirks5oh Posted September 11, 2015 Report Share Posted September 11, 2015 there is more to life than fiscal responsibility. If there wasn't, this forum wouldn't exist. I am not saying everyone should buy new cars always and what not but my wife has never bought a new car and her next car is going to be brand spanking new and I don't care the depreciation hit. Why? just that experience of driving something new once is kind of worth it to me and her. I've already had it - bought a new car when 17 and still driving it, she has not. If you approach life from the always safe position you'll cheat yourself out of some great experiences. Life is all about picking and choosing the right things for the moment and if a new car is the right thing for you - then why should a video about how not financially conservative it is stop you? who kidnapped geeto67 and is posting from his account??? i agree 100%. cars for me is a hobby. some people spend money on cars, some spend it on drugs, alcohol, cigarettes, boats, women, real estate, i could go on and on. as long as the percentage you spend on your hobbies is not a problem, i don't see an issue. i love being able to essentially buy a new car every year, have a full warranty, and enjoy the latest sports cars. i can't remember the last time i kept a car long enough to need a brake job or battery. i know there's a hit i take as the initial owner---doesn't matter to me. anyone want a 'lightly used' c6z?? :lolguy::lolguy: only sharted in twice. never seen rain, never revved past 3500rpms, (never spun out on my driveway and ended up 50' into my neighbors front yard). i'm looking at GT350's and new z's. just kidding, but not really Quote Link to comment Share on other sites More sharing options...
RC K9 Posted September 11, 2015 Report Share Posted September 11, 2015 I want GT-R. Priorities...I have them. Quote Link to comment Share on other sites More sharing options...
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