The game is rigged. 100k is still not enough, and that is crazy.

[™BlackPearl The Empress™]

Whatchu do shawty?

Manage

 

[dark_magic]

I promise you this is not a brag thread but one to open the eyes of people pining for that six figure salary. It truly is not much at all to break 100K. I make well over 100K and it still takes me an incredible long time to amass any type of formidable capital, other than financing it. Which just should not be the case. If the crucial things in life, for example, a house (or any property, condo, etc.) and a car, require the vast majority of people to have the money loaned to them, something is very much wrong. I couldn't imagine doing it on my salary let alone half.

Several issues here:

1) Most people accumulate capital in the "wrong" vehicles.
2) Most people will not have access to tap the capital if they wish i.e. 401k(s) and other qualified retirement plans.
3) Most people do not know how to accumulate capital in the most efficient manner possible.

Borrowing money isn't "bad" per se, but when utilizing the capital of others, it is imperative that you know what you are doing as well as have safeties in place for the debt or debt service.

The fastest way of acquiring capital is to borrow. Leveraging is also the fastest way of acquiring assets.

If a person is a working stiff, the most efficient way to build capital is a very high savings rate, say 50%+ of your net income saved.

Accumulation is a slower way of building capital. Velocity is a much more rapid way of building capital. The usage of both is what one may seek in their personal economy. Most people focus exclusively on accumulation. Velocity escapes them.

I have it in a spreadsheet and track everything in and out. On a base level, after all expenses I am able to save $2000 a month. That's with maxing out my 401K. I also put $500 a month into the stock market. $2000 a month is $24000 a year. The average cost of a house last year was 280k. The average cost of a car is $40k. Sure you can buy the car used but who is going to buy the new car so that it becomes "used?" You're or someone else is forced to take a loan from a bank that you'll be paying on for YEARS and be plagued by interest.

What you are becoming aware of is the accumulation of capital in a vehicle that you can't access (liquidity) or leverage (borrow).

Control over capital vehicles, flow of money, and contractual terms can go a long way towards increasing the efficiency of your personal economy.

 

[Mr Rager]

I understand the OP.. I was in that position before until i figured out you have to invest all your extra money. I remember i was saving 40-50k/year and only investing like 20k.. Once i started investing all the extra money that's when my money became financial steroids. If i could go back I would have at least 2m.. Now I'm creeping up on a M but it's only because for years i had idle money doing NOTHING.. Your salary really doesn't matter, your investments do.

I just realized this last year that my money was just parked in savings doing nothing

 

[Mass]

I learned a lot from this thread.

 

[Antwon Mitchell]

No offense, but a lot of you guys are just clueless and immature (living above your means) with money. $100K not enough? Shyt reminds me how a month or two ago somebody in a thread tried to make an argument that $500K wasn't enough nikka making nearly half of $1M and talking about “it's not enough” a lot of you wanna live like millionaires/billionaires when in reality your not.

 

[Mr Hate Coffee]

Mind you, only 10% or so of people make 100K or more in the US. What is everyone else doing? How is everyone else surviving?

breh I ask myself this all the time. My wife and I both make $140k plus. We just bought a house and the market was crazy. Plus we’re about to have our first child. I know we’re in like the top 4% of HHI. How the hell are regular folks affording this?!?? I’m guessing everyone is in debt. Smh

 

[Mowgli]

Buy a 200k house in the boonies. Whats the issue.

 

[Mr Hate Coffee]

I think this is OP's general concern. Even in his bracket he feels like at any moment he could lose it all so how in the world are people that actually make around the median income even functioning.

This thread is why the term "survivors remorse" exists. I've grappled with this feeling as well on many occasions.

This. I real sorry for @The Realist Perspective because clearly nikkas in this thread can’t read. Even if you make $100k, you’re one major hospital bill away from being BROKE. Knowing that will have you wondering how people with 1/3 the capital can even sleep at night. How is any of this sustainable???

 

[Mr Hate Coffee]

One more point I want to make. At $100k you’re getting squeezed from both sides. You make too much to qualify for many types of assistance (stimulus $$, student loan interest deduction, etc) and you don’t make enough to truly not worry about things. Add to that you’re getting taxed at a high rate too.

So yeah if you work so hard to get across this threshold, seeing the reality of it is sobering.

 

[Mr Hate Coffee]

Added to the fact that there's only maybe 10 cities that are considered high price areas. Alot of cities you can feel rich with 70k a year

You likely can’t make a high salary in those cities. Salaries and cost of living are directly related. Look at cities like SF and Seattle. Look at what’s happened to Austin

 

[greatone]

When you have serious goals and plans for your money outside of paying bills, 100k is definitely not enough.

It’s ok to want to live better than decent.

Not sure that is the case in this particular instant though. OP max out his 401k which is 19.5K/year, he saving 24K/year, and putting $6K/year in stock. That is almost 50K/year he have outside of paying bills. In 5 years that is $250K, 10 years $500K, etc and that just principle alone. This isn't not even including any interest from his stocks or 401K.

 

[No1]

@No1 how dare you avoid this thread

I avoid 90 percent of threads on theColi and have no idea what this one is about. But any thread where anyone talks about what someone should be doing with their money is stupid without knowing their specific situation. EDIT: OP is tone deaf.

Tell people to go talk to a financial advisor and set realistic expectations and goals for themselves and move on .

 

[greatone]

The mistake you're making is putting $500/month in the stock market. You should be putting $2500/ month in and getting a return on your money. Buy multi family homes and get income from them. You will be poor forever if your money doesn't make money..

I feel the same way. If a person had invested money in a simple Nasdaq index fund at the beginning of 2020 they would had made a 40% gain by the the end of the year. Even more conservative funds like VOO had a 18% gain in 2020 and 31% gain in 2019. That is why the most of the elite keep getting richer in a crisis. It sad to say or hear but they profit a lot from a crisis.

 

[Losttribe]

I find that the most annoying and clueless humans in America are those 100 to 200k earners... especially couples

They are ALWAYS act like they dont have shyt and never notice how hundreds of items,memberships, subscriptions, living in cheaply build homes near major cities, and Fake retirement plans will hurt them.

That group are the biggest slaves to a career or job/ benefits and typically end up working longer in life due to never being able to retire at that same life style (requires 10 mil and passive income)

 

[-DMP-]

It’s not alot on its own (if you’re aiming for more than just middle class life style) but if you are using it as leverage and make it work for you I think it is plenty.

I use to be all about saving and invest a little in the market. I switched that mind set and invest more and save a little.

got my first rental property as well and it’s profitable too. Plan on buying a multi family in the next couple of years. No more SFH unless it just makes more sense. Trying to scale upwards.

keeping my cost of living relatively low as well. I try to spend like I still make around 70k. Tho I do splurge from time to time. Keeps me sane.