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Reader Case Study: Young Man Saved from Jeep Suicide

j1Beneath all the fluff, this blog exists for only one purpose: to encourage people to change their behavior. So naturally, I am very happy when I hear from people who are actually making big changes.

And I’m even more excited to hear about people making big changes early in life, because then they get to enjoy many decades of benefit from those changes. Freedom, unleashed creativity, lower stress and much better health – all by just redesigning your own life to be more efficient.

This brings us to our latest case study, where a new reader hit a crossroads and could have gone either way. He made it to adulthood with a good education and a solid job. And somewhere in there, he had a buried instinct to make smart decisions, but social norms had him traveling down a different road – the one that leads to a lifetime of being broke.

[Update: after publishing this post, several people wrote in to point out my title was a bit insensitive. I looked into their claims and I agree – because of the incorrect parallel between my joke about financial suicide (where we have a choice in the matter) and actual mental health in humans, where people often don’t have choices. More info on the issue here.]

The following conversation has been edited a bit for length:


Good evening Triple M!

I have been obsessively reading through your archives for about 3 weeks. I have finally reached a point where I am compelled to reach out and see if you are interested in doing a case study, me being your next victim.

Firstly, a little bit of background. I am 25, single, college educated, fully-employed, and love long walks through the mountains. My upbringing was not very frugal, both of my parents worked hard, but they also spent hard. Reading this blog has been the gasoline to a little, itty-bitty fire that I had deep down inside me. I knew the right thing to do, but was so unsure, and always got grief for my “fantasyland” ideas– even from my parents. This blog has provided a community and case studies showing that it can and WILL work.

Secondly, I have made some fucking STUPID mistakes. When I say stupid, I mean STTTTUUUUUPPPIIIIDDDD. College credit cards? Check. Crazy loans for school for better housing? Check. Brand new car with bad terms? Check. Personal loans? Check. Spending on useless garbage that I have nothing to show for? Double-check.

Now, most of these sins in the way of the life of “mustachianism” occurred during college and the 2 years after. But I am still paying for them now. I am 25, soon to be 26. Single. No kids. I live in a 1-bedroom apartment as close to work as I could find that wasn’t $1,100/month.

Job Stats:

  • Income: $50,700 – a good salary for my section of the country (Northwestern PA).
  • 11% of base income goes into a 401(k) with my employer matching 4%. Great.
  • Now for the part that makes this all unique: a Bonus of 15-25% of our base salary goes into an Employee Stock Option Program. 100% vested after 6 years, I am in year 1 of this company.
  • Total Annual Income:  $50,700 + 4% + 20% = Roughly $63,000 ($52,000 after tax)

The Debts:

  • College: $44,440  – interest rates vary between 6-6.75%
  • Car: $21,710 – 2015 Jeep Wrangler JK Bought new at 5.09%, 25,000 miles on the odometer
  • Credit Cards: $9,990 between 15.99%-24.99%
  • Personal Loan: $8,300 4% interest only loan. Comes due in full 02/2018
  • Total Debt: $84,440

The Month-to-Month:

  • Rent: $480/mo.
  • Internet: $50/mo.
  • Groceries: $160-200/mo.
  • Car Insurance: $100/mo.
  • Electric: $30/mo
  • Gasoline: $140/mo. (50 miles round trip, no chance of moving closer, piss-poor MPG)
  • Car Payment: $400/mo.
  • School loans: $185/mo. (for 20 years– paying off higher interest first, this is lowest interest)
  • Personal loan: $30 (5% interest only loan. Cash backed)
  • Credit Cards: $300/mo.
  • Cell phone: $80/mo.
  • Total Spending = Roughly $20,520 per year 

No cable. I don’t drink unless its free. I am reasonably healthy and workout daily with a workout set I have acquired through the years.

The only other thing I do a lot of is travel! Love it, can’t live without it.

I have cut down my stupid spending drastically. I embrace your challenges and see how well I can do. This is my new idea of fun. I get the weird looks, snarky comments, and general distrust from the Jones’ family.. and I LIKE it! It’s fuel to the fire, baby.

With dang near two 401(k) accounts, once debt-freeness is achieved, shouldn’t I be able to retire early– twice as fast? I so badly want it now, but I realize that this is a marathon. It took a long time for me to get fit, and this is no different! I want to flex that mustache muscle, and bust that hell hole of a mindset we call, “Work for 40 years then maybe retire.” Fuck that.

– Justin Jeep in PA

 

Wow, what a great attitude!

The first thing that strikes me is while Justin’s debt looks bad, his cashflow situation is actually pretty good.  When putting together that summary of his story so it would fit in a tidy box, I combined a few things and converted all numbers into monthly and annual figures so we could get the big picture. And that picture shows that he is earning about $52,000 after tax, yet only spending about $21,000. Unless that mysterious “travel” comment blows the budget later on, since it was not explicitly broken out in his spending.

So although a good portion of his paychecks are currently going into retirement accounts and paying off debts, those still count as savings, which means he is saving $31,000 per year, or about 60% of his take-home pay. The Shockingly Simple Math of Early Retirement tells us that even in this situation, he’d become debt-free within about three years, and keep rising upwards after that, becoming wealthy enough to retire within a total of 15 years.

It’s important to remember that this excellent performance is the new Justin. If he had carried his old college habits into full adulthood, you’d also see a bar and restaurant tab of $1000/month, a few hundred dollars of random subscriptions and services, and a lot more spent on rent, clothes, gadgets, and other treats.

There’s no upper limit on how far you can take the Single Fancy Man or Fancy Woman Lifestyle, as the Toronto Pharmacist that spends his whole $130,000 salary while living with his parents demonstrates nicely. Earning more is great, and I highly recommend it. But by definition it is impossible to out-earn the habit of spending all your money.

On the other hand, if Justin’s spending had been this efficient (relative to income) all along, he wouldn’t have ended up with $84,000 in debt in the first place – in fact he would already be above the waterline

So he has made enormous changes for the better, and in the process chopped about 25 years off of his mandatory working career. But he still wrote to Mr. Money Mustache with an open mind, which means he is ready for more. Given his situation, what would I do? Let’s power through and fix up the rest of this situation.

Step 1: Stop Driving Around in an Offroad Toy Owned by the Bank

Justin currently lives in rural Western Pennsylvania, which is a collection of very small towns which are very far apart. This means he leads a life with a lot of driving, which means he needs to have a car that is incredibly well optimized for frequent long drives. But instead, he has a 2015 novelty toy based on 1940s-era military nostalgia with no practical use other than bouncing itself through a rock-strewn canyon while you drink Coors Light from a cracked Nascar Coozy and your friends sit on the sidelines and occasionally yell out “Yee Haw!”

Even worse, this thing came with a sticker price of more than half a year’s gross salary, and he didn’t even have the money to buy it – he had to borrow this toy from a bank!

Mr. Money Mustache’s first rule of cars is you never borrow money for a car. One of the next rules in that book is you can’t drive a Jeep on a paved road. Never. If there’s pavement, you use a front-wheel-drive hatchback that is either a 4-cylinder manual, or electric. If there’s snow, you put some goddamned snow tires on it. If you like off-roading, get some hiking boots or a mountain bike and use your muscles like a badass, instead of wasting your money on a big elaborate motorized La-Z-Boy contraption that allows you to go over bumpy terrain while sitting down and pushing some stupid power-assisted pedals! Motors are not a valid form of recreation.

Don’t even come to me with exceptions until you at least get that second comma in your net worth. So (in more polite terms), I told Justin to sell his Jeep:

MMM: For now your assignment is to find out what your jeep is worth on the used market and report back to me.  Craigslist,  Kelley Blue book and the Edmunds used car appraiser tool. Take some really good photos of it in front of a badass local natural background if possible.

 

My man’s Response:

A great Craigslist ad allowed Justin to get top-dollar while escaping this Jeep.

A great Craigslist ad allowed Justin to get top-dollar while escaping this Jeep.

Justin: Quick weekend update, MMM! The Jeep was listed online for all but 1 hour before I got an email. A gentleman kindly offered me $23k for my Wrangler! Which is great as the current payoff is $21,800 with interest accruing daily. It is a painful thing to think about, but the joy of getting closer to early retirement is out-weighting it..

MMM: What?! Holy shit that is excellent! Congratulations!

I feel kinda sorry for the next guy,  since he now has the liability.  But not everyone is a Mustachian yet. Keep me posted on the great progress!

 

 

Justin: 

Holy shit is right, Pete!!! After ironing out the details today, we agreed on an even better deal for me.. $24,000 sell price, and I included all my spare/original parts! If I tried to sell those I could probably get $750 with a ton of hassle and patience.. So, I’ll take that extra $1k!

It’s unfortunate, but who knows their situation. This individual could already be FI and I’d never know. All I have to say is, Godspeed.
 
Another nice note is that I get a prorated amount of my gap insurance back! Looking like that will be around $600-$650! Woohoo!


 

With step 1 complete, we had closed Justin’s biggest gaping financial wound. The $400 per month payment was going almost entirely towards depreciation, whereas a proper used car like a late-2000s Honda Fit depreciates at less than $100 per month. Plus, the Jeep was using at least double the fuel of any reasonable on-road machine. On top of that, his insurance was through the roof. All-told, he was wasting about $450 per month compared to an optimal car choice, a burn rate that compounds into about $77,000 every ten years*

Step 2: Consider Moving Closer to Work

Justin’s round-trip drive of 50 miles is at least 5 times the level I would consider absolutely insane.  He claims that living any closer would bump his rent up from $480 to $1100 per month, but a quick review of Google Maps and Craigslist shows this is not the case:

stoneboro

Just by visiting his region on Craigslist, searching for “housing” and selecting “map view”, I found a solid number of entire 4-bedroom houses for rent in the $700 price range within walking distance of work, and apartments for even cheaper.

Mr. Money Mustache’s ideal strategy: choose the nicest large house you can find, then rent out a couple of bedrooms to friends to give yourself a net rent of near zero. Your friends will also help you split the cost of Internet service, and you can share resources like tools, expertise, books, homebrewing equipment, music and instruments, movies, and errands like bulk-buying runs to Costco.

And of course, bike to work and pocket the extra $300 per month that even the cheapest 50-mile-roundtrip car commute would cost you (more like $700 if you are using a newer/larger vehicle).

I can’t stress enough the killing effect that a long car commute has on your life. It has been studied again and again – spending an hour in the car is far more expensive than just the $20 in direct transport costs and $25-100+ per hour in lost personal productivity. The physical and mental health costs, and of course the risk of being shredded by smashing metal and glass, are much larger.

Step 3: Make Sure your 401(k) Money is Going Somewhere Reasonable

Your employer plan looks generous, but the 401(k) options that small companies offer are sometimes questionable. Make sure your money is going to a all-US or all-world index fund with an expense ratio well under 0.25%, not an “aggressive growth” or “managed” fund. If no such options are available, have a talk with your HR representative and suggest that your company hook up with the small business 401k programs offered by Vanguard or Betterment.

Step 4: Streamline Debts and Smaller Expenses

Your student loans are at a shocking 6-7% interest rate. See if you can drop it a significantly lower with one of the newer independent refinancing firms like SoFi (article).

Your mobile phone bill is $80 per month?! What is this, 2002? The highest reasonable phone bill these days is about $20/month with Republic Wireless, or roughly $30 with Google Fi if you need cheap data while traveling internationally.

Since high-interest Debt is an Emergency, I’d suggest reducing contributions to your company 401(k) to 4% to get the company match, and putting the rest into the credit card debts until they are gone. This is because paying off those cards is equivalent to a 15.99-24.99% guaranteed return on your investment, something you won’t get anywhere else.

Step 5: The Big Picture

Justin is in a good starting place, but that does not mean it’s time to become complacent. For example, his current employer is in a very remote area, far from any town of more than a few thousand people. And it’s in an area with one of the more brutal winters of the United States. This means a lifetime of driving on icy roads and through blizzards – unless he chooses to change the situation.

If you have the amazing privileges of a good education, reasonable health, and a strong work ethic, there is no reason you can’t make over $100,000 per year, at a job you really enjoy, and live within walking distance of work. To me, this is the Holy Trinity of efficient employment design and it’s worth holding up as a goal – knowing it is absolutely possible even if you choose to compromise on one or more aspects to meet your own preferences.

I set $100k as a target because it allows you to live at middle-class levels and still save over 60% of your income, which means financial independence in roughly 10 years. And it’s an income that is not all that rare in the economy without requiring a highly specialized skill. But it certainly isn’t a limit – I’ve heard from a number of people who make ten times that amount, even in their 20s.

Life is not an income competition, but I feel there is a mental barrier that forms in the middle class, based around the fact that the US median household income is currently $52,000, meaning that half of households earn above this amount, and half below. (For individual workers, the median is even lower).

But put it this way: if you are smart enough to design car-commuting out of your life, you are already in the top 10% in that department. Work and income are just another strategic game. Especially if you open yourself to the Joy of Self Employment.

Conclusion: 

Justin is set for a bright financial future. Many things will change in both his income and spending pictures in the coming years, but by just thinking about the long term implications of each decision, and using the principle of constant optimization, he’ll take a more efficient course. Although the changes will feel easy and small to him, they will make the difference between “Broke” and “Millionaire” by the time he reaches my age. And because he is on such a prosperous path, he can give himself the Gift of not worrying about money along the way.

Have a great time, dude!

Further Reading:

Here’s my article on learning how to calculate your savings rate, net worth, and take-home pay.

Calculating take-home pay after taxes: I used this thingy on calculator.net

Since this article addresses cars and driving in a snowbelt area and fall is coming, find out why All-wheel-drive does not make you safer.

 

* To calculate the value of a monthly expense over a 10-year period, compared to investing that money conservatively instead, multiply the monthly expense by 173.

  • The Green Swan September 12, 2016, 6:40 am

    While starting out not too hot, Justin is definitely on the right path now. Thanks for sharing his story. Pretty incredible turn-around by selling that Jeep so quickly and realizing how much of drain that was. While it may be tricky for him to double his income to $100K in the near-term, I’m sure he could get there eventually (easier said than done!). That would really allow him to fuel his retirement for sure.

    Reply
    • The Long Haul Investor September 12, 2016, 7:32 am

      I thought the exact same thing about the jeep. When I tried selling my last vehicle I took a bunch of awesome pics, and set the price very reasonable compared to what it’s estimated worth was. Took forever to sell. Of course a lot of that depends on the buyers in your area on craigslist.

      Hahaha and “kinda” feel sorry for the new owner. It’s like the market – there is always a winner and a loser. Although true that person could be financially independent themselves. I know a few people with Jeeps that use them for off-roading mostly(they seem to understand their actual utility). They also don’t need to worry about money ever again.

      Reply
      • Fiscally Free September 12, 2016, 8:58 am

        I think it’s fine to use motorized vehicles for recreation, but it’s important to remember not to spend too much on any form of recreation.
        You don’t need a brand new Wrangler to have fun off-road. That vehicle has changed little over the last several decades, so you can buy a fully depreciated version that is very similar to a new one and get the same enjoyment out of it.

        I bought a 20+ year old Miata as a “fun car” and I don’t feel bad about it because I only paid a couple grand for it, and I can probably sell it for exactly what I paid for it.
        So, feel free to get a car that makes you happy, just don’t overpay for it.

        Reply
        • Mr FOB September 14, 2016, 4:04 am

          I agree it’s fine to use motorized recreation for fun. Here in the Netherlands, you can drive an oldtimer with almost no road tax and no depreciation at all. I drive a Citroën 2CV, a super cheap and super efficient convertible. With a group of like minded owners, we now and then even cook all kinds of fancy meals under the hood while driving, speaking of efficiency. Dedicated motor cooking books with recipes exist. Looots of fun, almost for free!

          Reply
          • Team CF September 20, 2016, 8:23 am

            That is pretty efficient, cooking, recreating and driving all at the same time, Mr. FOB! Agreed that motorized recreational fun should not be too hard on the wallet. Especially if you can do much of the maintenance yourself and pay very little to no taxes. We actually were considering a lotus Super7, but after calculating the costs decided not to, the financial freedom is worth more to me.

            Reply
      • steve poling September 13, 2016, 5:12 am

        I respectfully disagree. In any free exchange of goods, both parties benefit. For all we know, the Jeep purchaser could be an off-road tour operator who has just scored a huge win by buying a used instead of new, depreciation-filled vehicle. A huge clown car habit may be stupid, but how smart is paying all that depreciation just to drive a new car off a dealer’s lot?

        Reply
        • The Vigilante September 13, 2016, 4:57 pm

          I think it’s a bit of a stretch to say both parties benefit from any free exchange. I use that logic from time to time, but it’s actually flawed in a way: Both parties always perceive the transaction to be to their personal benefit in a free exchange, but either one (or both!) could be wrong!

          Look at it this way: Ideally, someone gets some money for something they didn’t want, and someone gets something they wanted for a little bit of money. But “winning”, for the buyer, depends on whether that thing is worth the money to that buyer – generally either in utility, or in value it will hold. And buyers are far too often wrong about that, which is one of the central tenets of Mustachianism (as I understand it, anyway!)

          If I’m moving and I need a lawnmower, and I buy one from someone else who is moving and no longer needs theirs, we presumably would both benefit. I get what I need (utility), he gets a little extra dough for something he doesn’t need. Win-win.

          If I enjoy coin collecting and I buy a coin collection from someone who no longer wants his, and I hold those coins for years in speculative fashion to sell later (a pretty non-Mustachian thing to do and something I am not interested in doing…anymore), I probably benefit as they will likely appreciate in value (although almost certainly less than other things I could invest in, making this a loss…but bear with me for example’s sake), and the seller again gets some money for something he no longer wanted. Win-win, as long as they appreciate.

          But I feel bad for the guy who bought the Jeep, if he fits the mold of most people who drive cars. If that guy who bought the Jeep plans to use it as a commuter vehicle, then he has lost. He’s buying something which offers no extra utility beyond that of other vehicles or modes of transportation, and which simultaneously will lose value rather than gain or even remain steady. Justin, on the other hand, parted with an unnecessary drain on his life and time. Big win for Justin!

          Reply
          • Mr. Money Mustache September 14, 2016, 8:08 am

            Yeah! And this whole “Both Parties Benefit” argument is at the root of the division between classical economics and behavioral economics.

            Classical (the original version) assumed we were all rational, so nobody should try to mess with our decisions.

            Behavioral economics sprung up after observations led to experiments which have shown that we are mostly batshit-crazy apes trying to meet our evolutionary desires, rather than Spock-like engineers strategically planning to optimize our long term happiness.

            The implication is that we should maybe take it easy on our gullible kinsmen. If I’m a rich, persuasive businessman with a pack of lawyers at my disposal, maybe I should NOT start peddling payday loans at an 80% interest rate in a poor neighborhood (while opening a used car lot and a liquor and smoke shop right next door for good measure).

            Classical Economics asserts “The customers know perfectly well what they want, and it’s their choice to buy that stuff”. It’s actually a form of tricking and enslaving people.

            The best book I’ve ever read on this situation is Predictably Irrational: http://www.mrmoneymustache.com/2013/11/21/predictably-irrational/

            Reply
            • Wendi September 15, 2016, 10:14 pm

              MMM,

              This is my favorite comment on the Internet. I absolutely love the idea of all of us ceasing to spend money on pointless junk that doesn’t make us happy and becoming rich in the process, but I hate the idea of becoming rich on the backs of anybody else. I know that most of my poor financial decisions were made based on very powerful emotions and the erroneous belief that “things” would make me feel better (“I’ll look successful if I have things!, “this object will make me feel better and relieve my temporary boredom or fear!”) I’d hate to think that I’m going to spend my time taking advantage of these very powerful emotions in my fellow humans, rather than helping them, as much as I’m capable, to stop spending money in pointless ways. Anyways, your comment gave me the ‘good feels’ about humanity.

              Reply
            • Steve D Poling September 19, 2016, 1:15 pm

              Your point about behavioral vs classical economics is well put. (I am not defending anyone’s decision to by a jeep, just suggesting that there might be a reasonable justification for the decision.) In general free exchange is a good thing, but you are correct to point out that we often use the freedom to our own hurt. I think we ought not engage in paternalism to protect the foolish from their bad decisions, but we ought to make it easier to warn folks who are about to be exploited.

              Reply
            • Steve D Poling September 19, 2016, 1:20 pm

              This paragraph is pure gold: “The implication is that we should maybe take it easy on our gullible kinsmen. If I’m a rich, persuasive businessman with a pack of lawyers at my disposal, maybe I should NOT start peddling payday loans at an 80% interest rate in a poor neighborhood (while opening a used car lot and a liquor and smoke shop right next door for good measure).”

              Reply
            • The Vigilante October 1, 2016, 8:29 am

              You know, I am pretty firmly a classical economics guy. I want people to be completely free to make their own decisions. And I see danger in making the assumption that protecting our gullible kinsmen is necessary and desirable, because adopting this thought inevitably ends up resulting in ever-growing government intervention and inefficiency (due primarily to misunderstanding and overcompensation by people who don’t really study economics, regardless of what the original intention of adopting this assumption was). To this effect, I defer to Milton Friedman’s personal statement, Free to Choose.

              But I am always given pause by the fact that, as you said in reference to Predictably Irrational, “most of the bad aspects of modern society are brought about by the failure of humans to properly maximize their utility.” To me, the best solution to this problem is education – primarily relating to personal finance, logic, basic psychology…generally not being “gullible kinsmen” and learning to recognize those who take advantage of their gullible kinsmen. Which is, by the way, the reason I absolutely love this blog – I think this blog is a step toward making such a necessary education easy, fun, and accessible to the general public. But I am concerned, in the back of my mind, with whether education is sufficient to solve that problem on a large scale.

              I’m curious if Predictably Irrational delves into that topic, and whether it determines education is the way to go, government intervention is the way to go, or whether it leaves a solution to the reader?

              Reply
              • Mr. Money Mustache October 1, 2016, 9:43 am

                Hey Vigilante – The book does get into that near the end – you should definitely read it. Dan Ariely suggests some lighthanded stuff like nudging humans in the right direction: making the “smart” choices an automatic opt-in which you can easily opt out of, if you choose. This is a win/win in my opinion, as those of us with strong opinions will get what we want. Whereas the more sheep-like people who are more easily influenced by going with the flow will get defaults (401k, city design, tax structure, etc.) with a bit of research behind them.

                It’s useful to think of it in two ways: Don’t be a classical economist, because that makes the quite obviously wrong assumption that most humans are rational creatures. As experiments show, most of us absolutely do not cross that hurdle (although some top percentage probably would).

                But remain an economic libertarian at heart, because GOVERNMENTS are made up of people too, which are just as irrational as the people they would try to regulate. So keep the government lean, but for any policies you do apply, use science and and understanding of human nature. On both sides of the desk: government employees need psychology and market-based motivations to be efficient as well.

              • The Vigilante October 1, 2016, 6:30 pm

                I cringed at “nudging humans in the right direction,” but then read on. You convinced me, MMM. Heading to the library tomorrow!

      • The Long Haul Investor September 21, 2016, 1:54 pm

        Read in Money Magazine the Top 5 vehicles that keep their resale values. Ironically the Jeep Wrangler is #5. Prob helps explain why he was able to get such a good price at sale.

        Here is the list with percentage of value kept. I can’t believe they are all Trucks/SUV’s – insane

        1. Toyota Tacoma 72.9%
        2. Toyota 4Runner 66.7%
        3. GMC Canyon 70.7%
        4. Chevy Colorado 70%
        5. Jeep Wrangler 65.6%

        Reply
        • Andrew September 23, 2016, 6:36 am

          Nothing for nothing, the Toyota Tacoma’s and 4runners are one of the most reliable vehicles out there. I know people that will drive those things into the ground with 400+k on the odometer. I think to each their own, and there are certainly better choices out there (which are also just as reliable). I happen to really like the First gen Tacomas and the first gen 4runners (85-89) but mostly because they were the same as the Hilux, and 4 cylinder. But good luck finding one that isn’t extremely rusted out or overpriced. I have seen people buy a Tacoma in 2008 for $25k and sell it with 60k miles four years later for 30k – silly the demand but people stick by them. I have also seen Jeep’s in Florida go for well above blue book, simply because people can keep the top down in the “winter” months and enjoy the vitamin D. Which is good news for any mustachian wannabe who owns one of those vehicles.

          Reply
      • The Dreamers September 24, 2016, 7:59 am

        I made the same mistake and went for the new vehicle (a Truck) when the auto industry was shuttering dealerships. At the time I just wanted something reliable since my current car was having transmissions issues. It has been reliable but now I realize I could have had my house paid off this year if I had gone for used and gas efficient… I ponder selling it but can’t bring myself to do it yet.
        The Dreamers

        Reply
  • PoF September 12, 2016, 6:47 am

    The description of the Jeep and its purpose is pure gold, MMM. Vivid imagery like that keeps me coming back.

    Nice job setting Justin on a more focused path. He was generally headed in the right direction, but needed some prodding to look at the budget from all angles. The part that jumped out at me in his report and your reply is the inability to move closer for less. I tend to take people at their word, but his statement on rental costs close to work turned out to be flat our false.

    I’ll be posting my annual spending tomorrow. Perhaps there’s some fine tuning we could do there, too.

    Best,
    -PoF

    Reply
    • Bill September 12, 2016, 8:29 am

      Not to mention, when you spend 500-700 a month on driving, moving closer (which adds 2-3 hours to your day) is a no brainer, even at $1100. I suspect MMM’s numbers on the cars are low. You can do the math yourself by checking the actual depreciation of various cars with particular mileage on KBB, and using that plus gas plus maintenance as a per-mile figure for your commute.

      Reply
    • Basil September 12, 2016, 5:39 pm

      I totally agree with PoF! The imagery in that paragraph on the Jeep is an example of an element that makes MMM so compelling. Heightening the language and making us laugh so we realize the error without taking offense…it’s great, effective. Classic.

      Reply
      • Helen September 14, 2016, 7:53 am

        Yup! I find myself repeating MMM zingers to myself all the time. He’s a smart guy with a vision, but even rarer, he writes well.

        Reply
        • lurker September 15, 2016, 6:53 am

          yes. great writing is hard work and being funny regularly is even harder. but Money M never backs away from hard work and we benefit!

          Reply
  • Mr. Real Estate September 12, 2016, 6:58 am

    Justin is the new MMM hero. There will be posters printed of him that little kids that dream of FI will buy and post on their walls. The incentive to stay on the path will certainly guarantee a high ROI on the price of the poster.

    Reply
  • Fervent September 12, 2016, 7:10 am

    Wow great on Justin for coming out and getting the MMM treatment. Apparently taking kick ass photos really works when selling stuff on Craigslist.

    Reply
    • Jeepin Justin in PA September 12, 2016, 12:14 pm

      Take the time and do it right. I spent more time getting those perfect photos and writing/posting the ad than I did getting it sold. 1 hour from posting, I got 4 emails, 2 offers, and it wasn’t hard to find the right deal!

      If there is an article about how to post a proper Craigslist ad, I haven’t yet gotten to it yet.. But might be a good idea for a future post, MMM?!

      Reply
      • Matthew Machles September 12, 2016, 8:37 pm

        Justin, thanks for submitting your case study. MmM posted a n article on how to do CL correctly a few years back. Great read, just search for it near the top of the page.

        Reply
      • Mr. Real Estate September 13, 2016, 6:45 am

        Reply
      • deepseafalcon September 14, 2016, 10:04 pm

        Hi Justin
        it seems like you are not aware yet that in buying a Wrangler, you actually made a pretty good choice economically in one particular aspect: depreciation!
        Wranglers are, along with very few other cars like Porsche 911, quite unique in that they depreciate very little based on age alone. Their depriciation is much more based on condition & miles, as they have a relatively huge fan base and are rather timeless.

        They can even slightly appreciate (although I don’t recommend them as an investment).
        Example: my Wrangler bought in 2012 (used, a few years old) is now worth a couple of grand more than it was back then, based on its very good condition and few miles added.

        For those who don’t believe it, check used prices for evidently good condition older Jeeps (hard to find!) vs newer ones on cars.com, and play around with age and miles on KBB.

        So while a Jeep certainly is very expensive in daily operation vs a small car, it is actually an economically much better choice than say a Ford Explorer (for those that like it).
        Needless to say, a Honda Fit is an even better choice yet econimically, but not everybody likes it … and its OK to have some fun if one can afford it.

        Reply
  • liberatedotlife September 12, 2016, 7:11 am

    This is a pattern that seems to crop up all the time in the FI-o-sphere. It’s like a race between the progression of ‘normal grown up spending’ lifestyle inflation and the discovery of FI. Fortunately, this guy seems to have ‘got it’ at 25. I wish I had!

    Convince a clever 18 year old that saving > 50% of his/her income is a good idea and you have a future millionaire (probably by their early 30s). Unfortunately, most people seem to wise up as they head towards 30, at which point they’re starting to acquire more responsibilities and lose some of the opportunities for ultra-frugality they had when they were younger.

    I think this guy is definitely young enough to be on the correct side of that ‘hump’ so it’s great that he’s chosen this path with gusto.

    +1 for MMM’s advice to focus on increasing the income. Good luck Justin!

    Reply
    • Chris September 13, 2016, 1:58 pm

      Great call on the added responsibilities making it more challenging to take advantage of frugality opportunities as we get older.
      No daycare or preschool to pay (for most) in their early 20’s. Another reason why it’s SO important to stash from day one in the work force. I whisper it to my kids as they sleep at night in hopes that it seeps into their subconscious. :-)

      Reply
      • Emy September 14, 2016, 9:57 am

        My mom mad a big deal of us opening savings accounts at the bank when we were little and as soon as we turned 16, she helped us open IRA’s. With the internet and better investing advice, I’m sure you’re kids will do well!

        Reply
  • Demetrius September 12, 2016, 7:30 am

    The real test is finding a frugal girlfriend!😀

    Reply
    • Engineeredgains September 12, 2016, 10:36 am

      Too true! I lucked out when I found my GF. She is almost more frugal than I am! (26 set on path to be RE in 9 years) but even with the most frugal of significant others spending will increase!

      Food, dates, and misc expenses do add up. The problem with the mustachian lifestyle is it tends to come across as “preachy” to others. Even though I’ve never said anything about me wanting her to be frugal my girl feels “pressured” seeing my and my lifestyle. Be prepared for arguments and disagreements but it shouldn’t be any different than any other relationship.

      My biggest financial decision to tackle is marriage… even with a very frugal GF she wants a nice ring and wedding… Sometimes you cant skimp on the important things in life

      Reply
      • Amanda A. September 18, 2016, 11:31 pm

        Have no fear! You can have a beautiful ring and wedding that are quite frugal. We planned and budgeted for the full 75 on our list, and didn’t go over-budget on ANY part of the planning. Total cost would have been $2000 for all of it, including rehearsal dinner, bach. party, suits, wedding dress, ALL of the rings (poly and guys who wear engagement rings make for a lot of rings), photography, non-potluck dinner for everyone (buffet restaurant we love – everyone ate whatever they wanted, be that shrimp cocktails or jello and slushies), favors (one of our more expensive parts – a USB battery pack with a mini flashlight that plugs into the USB and is super bright, but we LOVE them and wanted to share with our friends and family anyway – if we didn’t have the perfect idea, I was fine with skipping favors), and a ton of other little things. As it was, about half our guests didn’t show up (unsurprising given some of their locations, and that we were budgeting for everyone bringing a +1, and no one did), so we spent about $1010.00, my parents contributed about $400 to the cost (the dinner), and we have two suits now (one for my husband, and one for my fiance, as neither had a nice suit), a couple dozen extra favors (that are things I’d have bought for ourselves anyway – we paid $3 apiece for them and they usually retail around $10, so that was really nice), plus we had a great time with our friends and family. Our final budget was: ~$200/person for outfit (slightly more for the reusable suits, slightly less for my gorgeous, poofy, white, sparkly, wear-it-once-and-never-again dress ($68) that I loved and all my accessories that are mostly reusable to go with it (~$50)) , ~$400 for food, $150 for favors, $150 for rehearsal dinner and bach. party, $100 (and a lot of time) for invitations, save the dates, programs, and thank you cards (that were all mailed within five days of the wedding), and $100 for tips for photographers (we won a contest for one photographer, and a family friend volunteered to take some too) We could have saved more on it, but we knew what we wanted, what was important to us, and we did those things. I’m very happy with what we spent on it, and I feel like anything else we cut, would have actually been disappointing to me (except MAYBE the programs, but those were $3 total for all of them, so I’m not gonna worry about it). We wanted a big celebration, and spending $1000 out of pocket for one big day where all of the people we love came together and celebrated for several hours, and before that, we had a lovely little ceremony, and professional photos of us for the first time in a decade…. it was worth it.
        Sorry for the wall of text!
        TL;DR: I got married two weeks ago for under $1500 and it was literally me and my husband’s dream wedding, and that’s not because our dream wedding is city hall or similar. 1/3 of that cost went to re-wearable nice clothing.

        Reply
  • Gwen September 12, 2016, 7:33 am

    Tell ‘Justin’ he’s more than welcome to move to the Midwest. We could always use more single FI guys in the area (especially ones around my age hah!)

    Reply
    • Mr. Money Mustache September 12, 2016, 9:55 am

      Justin, I can endorse this path – Gwen’s a cool gal and she will definitely get you connected with a fun social scene in.. (is it still Des Moines?)

      Reply
      • Gwen September 12, 2016, 10:46 am

        For now! I might be moving…….. somewhere (don’t know exactly where yet) this fall/winter.

        Reply
        • Jeepin Justin in PA September 12, 2016, 11:48 am

          I am always looking to meet new people! Now, it has gotten quite a bit more interesting that I am seeking the company of FI-minded ladies! Sooo, hi there!

          Reply
          • Marcia September 12, 2016, 12:24 pm

            I’m sure there are some in NW PA too. I grew up there (Clarion). Most of my sisters are frugal. Of course, we are all of “parent/ aunt” age. I can’t speak for the younger generation.

            Reply
            • Justin Jeep in PA September 12, 2016, 12:59 pm

              Clarion! What a great town! I may be slightly biased with my love for the river… and that is also where I happen to earn my degree! Can’t believe how much is has changed since I’ve graduated a mere 3 years ago…

              Reply
          • TinaP September 12, 2016, 12:27 pm

            MMM is going to have to change to MMMMM – M de Cinco? :)

            Reply
          • Nicole Ryan January 3, 2017, 7:29 am

            Hello Justin from Mercer PA!

            Reply
      • Eeshwan September 12, 2016, 11:36 am

        Can confirm, Iowa is great for CoL (even with my slightly expensive, 1 roommate arrangement) and we have great corn!

        Reply
  • Mike September 12, 2016, 7:44 am

    I disagree on paying off low interest loans. Our mortgage is 2.5% after the interest deduction (and we can walk to work) and our car payment is 0.75% (and gets 80 mpg). I can invest any payoff money in index funds and get a much greater return.

    Reply
    • The MAD Consultant September 12, 2016, 8:45 am

      In Justin’s case it appears his lowest loan is the personal loan at 4%. That’s still a decent return he can net himself by paying it off. Considering the valuation of many stocks and bonds right now the net trade-off is minimal. And remember even if he can invest and receive an 8% return that is no guarantee. Of course there are other investment options with higher returns, but that might require either more money or risk which he might not feel comfortable with. What if he does decide to invest that money instead and experiences subsequent yearly declines of 5% & 10%? It’s likely he could feel miserable about his decision and abandon ship when the following two years show gains of 15% & 20%. He would have missed all the upside, whereas paying off his own debt is guaranteed.

      Each person’s situation is unique and their numbers can be vastly different from another person. So what makes sense for you won’t make sense for them. Congrats to you for having such a low interest mortgage rate. Not everyone is as lucky remember.

      Not to nit pick, but a car payment? Even on an efficient vehicle. “Mr. Money Mustache’s first rule of cars is you never borrow money for a car” . I back MMM 100% on this too, and its also my philosophy.

      Reply
      • Mike September 12, 2016, 12:04 pm

        Thanks for your thoughts. I didn’t need to borrow money for the car, but at 0.75%, why wouldn’t I do that and invest the money for the 3-5 years instead?

        I was commenting on mmm’s never loan, pay off mortgage philosophy more than the case study specifics. I think at low rates over long time periods, loans are fine if you invest the money instead. Otherwise you lose money over the long term

        Reply
        • Rebecca September 12, 2016, 1:43 pm

          Do you also include the added expense of full coverage auto insurance when weighing the pros/cons of financing a car and investing the money instead? Where I live it’s mandatory to have full comprehensive/collision insuring when financing but not required when you own outright. Depending on the price of the car and state you live in this math could change the benefit you mention.

          Reply
        • Dale September 12, 2016, 1:57 pm

          Fairly sure MMM doesn’t advocate paying off very low interest loans. Can’t be bothered to dig out the evidence. The rule I’ve seen is… Less than 3% don’t pay it off. More than 5℅ pay it off. 3-5℅ depends on your situation/attitude to debt vs investing.

          Reply
          • Roger September 18, 2016, 11:13 am

            Well… let’s say you had no car payment, a paid off mortgage, and the opportunity to borrow money at 2%. Would you borrow money and buy stock with it?

            If yes, then the above rule makes sense! But I personally wouldn’t do that.

            Reply
            • BG September 29, 2016, 5:23 pm

              If the terms of the loan were friendly to a semi-long-term investment, I’d take it in a heartbeat. That’s called leverage in the financial game, and almost all highly-successful investors do it. Of course, I’d buy low-cost index funds, not direct stocks, as I’m not willing to absorb *that* much risk.

              Reply
        • GingerMustache September 16, 2016, 4:45 am

          Good point. Another thing to consider is that sometimes they offer you these low interest rate loans; however, the price of the car is above what it should be. This happened to my mother-in-law who thought she walked away with a great loan only to realize the car itself was overpriced and could have got a much cheaper identical car by paying cash.

          Reply
  • insourcelife September 12, 2016, 7:58 am

    Wow, the whole Jeep bit sounded so similar to what I did when I was around Justin’s age. First job+good money=brand new Jeep Wrangler Sahara financed for 5 years. Followed by a 4″ lift and 33″ tires. There is definitely something about Wranglers that clouds a young man’s vision. Sold the Jeep after 3 years which was definitely a smart decision.

    Reply
    • Mr. Money Mustache September 12, 2016, 10:08 am

      See, this whole Jeep thing is such a mystery to me. I too was a high-income young man not all that long ago, and I’ve had a chance to drive most of the iconic off-road vehicles both on and off roads: various Jeeps, Tacomas, 4×4 pickups, Scouts, Land Cruisers, 4-runners, and all that, because friends had bought them.

      And in the nicest possible conditions – winding canyon roads and dirt trails, for backpacking trips in the Rocky Mountains.

      They were all HORRIBLE – wiggly and imprecise and tippy, with long shitty gearshifts and 1940s-era clutches. The engines were loud and thirsty but not even all that powerful. It felt like the technology stopped advancing 40 years ago. And the interior layout of a Jeep – with no interior space and that tiny windshield – it’s probably the worst interior you can get.

      Maybe because my tastes were formed by starting with mountain bikes, then lots of semi-hardcore offroad dirt biking on a Yamaha 125CC.. Then learning road driving in a bright yellow 1989 Honda CRX Si 5-speed and on the 2-wheeler side a 1983 Kawasaki GPZ 550. (Both due to my Dad’s good taste in vehicles at the time – thanks Dad!)

      But I learned to like smooth, tight engineering and good handling on the road. And when you’re off the road, you want 2 wheels, not 4, so you can thread through tighter spots, steeper grades, and avoid boulders. And you need to be riding something that you can lift out of a ditch with your own muscles in the event of a crash. Who wants a steed so heavy and awkward that you can’t even move it yourself, when you’re out in the wilderness?

      So anyway, the idea of using a Jeep to drive to work, and why that is fun for anyone, eludes me. It’s almost an Emperor’s New Clothes situation, where people consider it cool because they saw other cool people saying it was cool.

      Reply
      • Marcia September 12, 2016, 12:27 pm

        I recently read an article about Jeeps. Mostly about how they suck, and yet have strong sales due to their image.

        My sister in law used to have a jeep. LOVED it. Alas, it was not a great fit with her 40+ mile each way commute (and her 2 hour drive weekend shopping habit). She replaced it with a Camry.

        But just traded in the Camry for a new Wrangler. “SOOO EXCITED!! I MISSED MY JEEP”

        Sigh

        Reply
        • Fuzz September 12, 2016, 5:03 pm

          This is gold. A lot of those old jeeps and 4x4s have terrible handling and need constant maintenance. What I don’t get are the Toyota Tacomas and and Tundras. Those have incredible cachet in the mountain towns. I have a buddy that in 2016 sold a 2007 Toyota Tundra with 100,000 miles, the SR-5 package and a topper for $20K. Holy smokes. Brand new, base mode is like $30K for a Tundra and $25K for a Tacoma. Drive it 10 years, put $100K miles on it, and have the systems be several generations older, but only depreciate it 30 percent? Who buys that? You have to be (a) bad at math (b) unaware of the prices of those vehicles new and (c) really, really want one. You’d think (b) and (c) are mutually exclusive…

          Anyway, you’re giving me courage to own my opinions on these vehicles.

          Reply
      • FormerJeepOwner September 12, 2016, 3:57 pm

        I owned a Jeep for about 1 year in college and after spending most of my money buying silly “upgrades” I saw the light and passed it on. That’s not to mention the mechanical fixes.

        Just Empty Every Pocket

        Reply
      • Mark from Columbus September 13, 2016, 12:21 pm

        MMM – I’ve read every one of your posts and they’ve helped me immensely. I need your advice as it relates to offroad vehicles. I’m an avid hunter for almost 30 years who requires a suitable 4×4 vehicle for about 3,000 – 6,000 miles a year. I plan to tow a trailer or rent a camper for out of state hunting trips so towing capacity of say 5,000 lb.+ is needed. A pickup seems like the appropriate choice for towing, ground clearance, and hauling harvested game. I have been struggling trying to find a creative solution in place of buying a truck. Everything from renting one, to a 2 vehicle solution, to a wagon or small SUV. I can’t make the math make sense for the loss in capability. Have I done my homework well enough? Would you bless this as a smart purchase?

        Reply
        • Mr. Money Mustache September 13, 2016, 2:34 pm

          Hi Mark, it sounds like your situation is much like mine: I occasionally do extreme hauling and more frequently do trips carrying just people. So I have two different inexpensive vehicles – a 1999 Honda van with all seats removed and a trailer hitch (tows 3500 lb easily) , plus a 2005 Scion xA (gets 42 mpg easily). Combined, they are worth under $8000. And the insurance penalty for having both is really small – about $7 per month added to my Geico bill.

          Reply
          • JGfromSTL September 19, 2016, 2:20 pm

            You didn’t really answer his question. I’m sure you have some words of wisdom for HIS situation…

            Reply
        • Shannon September 26, 2016, 4:41 pm

          MarkfromColumbus – have you considered a used Sprinter Van? Can customize the interior into a camper, and I believe some of the older models came in a 4×4 configuration. I’ve been told to stay away from the 4×4 in the newer ones, apparently tons of problems there.

          This is actually what I’m thinking about doing in 2 years when my lease is up and I’ve got an idea as to what my residual income will be for the next 3 years (I’m a telecom agent). Get the heck out of Denver and spend some time on the road with my dog, exploring the west and save even more $$$.

          Reply
        • Chris from London October 3, 2016, 6:14 pm

          I hunt quite a bit and use a Pontiac Vibe. I have a hitch mounted rear rack that holds additional gear. I can pack tons of decoys and my layout blind in the hatch. No problem stuffing a deer in the back either.

          Reply
        • HunterfromTexas October 8, 2016, 8:53 pm

          Mark, my father and I used to use a Honda Odyssey van for just this purpose – I’m not sure of the duration of your trips in the past, or if you’re bouncing around totally offroad on rough terrain, but we were able to take it up and down some steep rocky cattle trails fine, slept in it for days when the weather was foul, and it brought all our deer home safe (if a bit fragrant in closed quarters.) Plenty of room for fullsize coolers and two or three deer or pigs. It’d be significantly less expense than a trailer-truck combo and keeps your harvest or other gear and supplies dry. It’s not the fanciest solution but it transitioned well back to just hauling kids to and from school or event gear or anything else.

          Pair that up with a trailer hitch like MMM mentioned if you want to get fancy!

          Reply
      • Lynne October 15, 2016, 6:35 pm

        This is why there is a whole line of goods with the slogan, “It’s a Jeep thing.” Every day I drive my Wrangler feels like vacation. I love putting the top down and the rough ride, and I’m not even a car person.

        Reply
  • Mrs. PIE September 12, 2016, 8:01 am

    Great job all around. He asked for the tough love, you dished it and he accepted it. He’s on a great path having realized his life’s trajectory so early: young, free and single. Unencumbered by things that make it easy to make excuses and carry on as before. This brings into focus the more difficult situation those more set in their ways find themselves in – and why the tough love is so often rejected in favor of business (and spending) as usual.

    Reply
  • Financial Canadian September 12, 2016, 8:02 am

    Reading this post made me proud to be driving a 2004 Pontiac Grand Am!

    It’s crazy how quickly car costs can accrue if one is not careful.

    Reply
  • JB September 12, 2016, 8:28 am

    Renting out rooms to friends can make them not friends if they don’t pay the rent on time.

    Reply
    • Mr. Money Mustache September 12, 2016, 9:32 am

      Yeah, I’ve never been in that situation but I could imagine it would be true. Although I’ve never had any friends who were THAT bad with money, if I did it would be pretty easy to avoid inviting them in as housemates.

      Reply
      • Anonymous September 13, 2016, 4:47 am

        Most people don’t like talking about money. As a result, it’s often hard to know who is likely to fail to pay rent on time before getting into such a situation with someone. Sometimes it’s easy to recognize, like the friend who always shows up an hour late to everything and talks about their expensive purchases that you know they can’t afford. But some people hide their financial flakiness well.

        Reply
        • steve poling September 13, 2016, 5:25 am

          You can look for signs of frugality versus spendthriftiness: do they walk to work, carry their lunch, pay cash for older, sensible cars? Or you can ask whether they have an opinion about budgeting and/or debt, then just listen for mustachianisms.

          Reply
        • Mr. Real Estate September 13, 2016, 6:51 am

          I believe this is one of the greatest things about Venmo, send a polite request for the repayment to everyone involved and they also get to see everyone else repaying.

          Reply
      • Anonymous September 13, 2016, 4:50 am

        It’s also entirely too easy for a friend to think that their friendship entitles them to put you lowest on the priority list to pay. With anyone else, they’d pay on time, but you’re a friend, so you’re good for it, right?

        Reply
      • Conrad September 18, 2016, 8:37 am

        When I was in college I leased a house and rented the rooms. I just advertised in a local paper. People would show up with rent and security deposit in cash. After talking a little while I would find out that they have a decent job and that we’ll get along pretty well. I had a 100% success rate with roommates and we always became friends. When they show up with all the money in cash that probably tells you everything you need to know. A friend of mine always rented rooms to friends with no money and had a 100% failure rate.

        Reply
    • Shannon September 26, 2016, 4:45 pm

      That’s why I’d only do this on a month-to-month lease basis, with strong protections for the “landlord” to terminate the lease with 30 days notice. I rented from a friend on that basis (and she still does that going forward) and it worked out great for everyone. Granted, I’m in an insanely strong rental market, but there are ALWAYS going to be people who will pay a premium to be able to rent on a M2M basis.

      Reply
  • earlyretirementnow September 12, 2016, 8:31 am

    In this day and age I would get rid of student loans before investing in taxable accounts. 6-7% interest on loans is a 100% certain return, which I would prefer over the 6-7% expected return in stocks. So, tax-deferred savings (equities) first, then student loan repay then taxable savings. I would certainly pay down student loan debt before investing in a bond fund (2-3% interest).

    Reply
  • Mrs. Picky Pincher September 12, 2016, 8:31 am

    I love that he got rid of the Jeep. :) Mr. Picky Pincher wanted one of those “cool, fun Toy” cars for years, but obviously the cost was too stupid for us. Plus, unless you’re in the mountains/snow daily in the wilderness, a Jeep doesn’t make a lot of financial sense.

    It’s hard to fight the allure of these vehicles, but once you realize what your daily needs actually are, it’s an easy decision. That’s why we got rid of our car payments and are loving the used (and reasonable) car game. :)

    There are always ways to cut the budget! You just have to be willing to go the extra mile.

    Reply
  • BarbeRiche September 12, 2016, 8:39 am

    Way to go Justin. You just gave the first push on your financial freedom snowball!

    25 is so young. I had negative net worth at 25. The mother of my son and I are both 28 now and have combined net worth of 225k+ with salaries just like yours.

    Congratz Justin and thanks for the refreshing article MMM!

    Reply
    • Kyle B September 13, 2016, 11:28 am

      How did you do that turn around?

      Reply
      • BarbeRiche September 24, 2016, 8:48 am

        Sorry for the delay didn’t see the notification!

        A friend of mine suggested that I read Early Retirement Extreme. From that book, I found MMM and other blogs and was simply hooked. We had just started to save some money but finding this community just gave me a lot of motivation and a clearer picture of where I wanted to go.

        From that point, we bought a rental property, started to max out our RRSP, TFSA (canada) and started to make more money at our job which made it a lot easier to save a big percentage of our income. We’re at 47% in 2016 with a 6 months old baby ..!

        Reply
  • Mr Crazy Kicks September 12, 2016, 8:42 am

    I also bought a car when I first got a good job – a brand new RSX Type-S. A few years after buying it I realized it was just a car getting me to and from work. I sold it, and bought a $3,000 civic with cash. Thanks to that decision I am financially independent today.

    Justin, you made a excellent start on your journey and have a great plan. Best of luck!

    Reply
    • E in DC September 12, 2016, 12:53 pm

      Too funny. I bought the same car, right out of college, mine was red. And what did I replace it with? A Jeep Wrangler – Rubicon, to boot! Both were completely terrible decisions financially.

      I’m going on 40 now, and about a year into working on FI (sans Wrangler).

      If there’s one lesson I take away from MMM, it’s to be smart about what vehicle you buy, if you have to buy one at all! They’re one of the biggest *potential* sources of a lot of FI-killing debt.

      I wish I could go back to being 25 with this knowledge. Don’t waste it Justin, and good luck!

      Reply
  • Steve Divicent September 12, 2016, 8:47 am

    Being financially successful is all about attitude and will. The fact that Justin reached out, admitted his financial mistakes and is taking awesome steps to fix those mistakes shows that he will end up in a great position in a few year.
    3 years to be debt free and 15 to retire is not a bad situation for a young guy :)

    Great work Justin and the Jeep move was super smart.

    Reply
  • Fiscally Free September 12, 2016, 8:50 am

    I totally agree with the thoughts on commuting. I used to live three miles from work, but that job left the state, so I now have a 40+ mile commute in Los Angeles traffic. It is killing me, and not all that slowly.

    I also think Justin should accelerate his debt payments. He clearly has plenty of extra income to throw a all that debt.

    The one area I’m not as bullish as MMM is housing. Telling someone where to live based on a Craigslist search of a random area is a little silly. For example, I could save a ton if I moved a few miles away to a little neighborhood called Compton, but I’m not inclined to do that. If you were unfamiliar with the area and were just looking at housing prices, you might recommend that for me.

    Reply
    • Lisa September 12, 2016, 9:27 am

      That’s a great point. I’m trying to steer my youngest sister down the FI path as she’s starting her first job, and I was a bit disappointed in her choice of housing. It’s about a 20 minute commute* and is costing more than I think it should for the area. However, I wasn’t there to evaluate the area of the cheaper apartments she would be living in as a young, single woman. Safety is something that needs to be taken into consideration, too.

      * I’m told the commute is an unfortunate necessity of her working at a business park in a rural area outside the city, and apparently the city area closest to the office is known as a not-great area of town.

      Reply
    • George Sowers September 12, 2016, 9:45 am

      FF I agree. I was thinking the same thing, unless you know the area you can’t go by just prices. There’s usually a reason one areas rent is cheaper than anothers. That said now that Justin adjusts his buget for the closer commute, smaller or no car payment, less gAs, insurance etc he may be able to put more of his income toward housing.

      Reply
    • Mr. Money Mustache September 12, 2016, 10:14 am

      Sure FF, if you’re afraid of Compton you could avoid that area*.

      But if you are currently driving 40 miles, you could EASILY find an area many times closer to your work that would be plenty safe. Given your situation, I’d be spending all waking hours on Craigslist to get new housing.

      In fact, I’d personally sleep under my desk at work, or in my car in the parking lot, during this search period, because an 80 mile roundtrip in Los Angeles is so insane. You’re not only hurting yourself, but also thousands of other people you drive past or share a road with, every time you make this commute.

      *Also, are you SURE your neighborhood data is up-to-date? I remember holding a meetup in a park in SE San Francisco, and one reader commented “My wife won’t even let me go anywhere NEAR that dangerous neighborhood”. It turned out to be, like anywhere else in Coastal California, a pretty safe and beautiful place, and the crime wave had long since subsided. Dangerous neighborhood reputations are usually overblown.

      According to this, the Compton popularized by NWA in the ’80s/90s is long gone and murder rate is down 80%: http://www.latimes.com/local/california/la-me-0815-compton-image-20150815-story.html

      I remember walking through Compton with a couple of friends in 2001 and it was a little edgy (we got some taunting calls from a pack of dudes hanging out in a parking lot), but even so it was not nearly as bad as they warned us it would be. And that was almost a sixth of a century of LA gentrification ago :-)

      Reply
      • kiwigirl in LA September 12, 2016, 11:24 pm

        I think Justin’s on a great path if he realises at 25 the dual perils of overspending on housing and automobiles. Just to weigh in on housing in LA, I could never face a long commute and adjusted my housing accordingly. But I still recall my friends sneering over how far” inland” I was (um yesterday I walked to Manhattan beach in 45 minutes) and how cash poor I must be if I had to have a flatmate (I never told anyone I was paying extra on the mortgage). I totally agree that there’s cheaper areas to move to, even in LA. I wouldn’t move to Compton but Gardena, Inglewood, San Pedro are all reasonable and safe. If someone doesn’t want to abandon their house (many “inland” houses haven’t rebounded to their former values) well LA is a big place with many industry centers, I’d look at the possibility of a new job.

        Reply
      • Fiscally Free September 12, 2016, 11:41 pm

        I understand what you’re saying. It is definitely not a good idea to jump to conclusions about an area without visiting it, but I can assure you there a lot of places around LA you don’t want to live, even though the rents look very appealing when you are just looking at a map.

        I also appreciate your passion about my current commute. I made it a little more tolerable by getting a (used) plug-in hybrid so I can use the carpool lane and not pollute quite as much.
        The reason I put up with the commute is because I view my current job as temporary, and I don’t want to bother selling our house or moving for a short-term gig. As a matter of fact, I plan to quit that job and “retire” when I turn 30 at the end of this year.

        Reply
        • Jfigueroa September 18, 2016, 11:19 pm

          Sounds like your situation works for you, but I always laugh when I hear people say that there is an area in LA that is “unsuitable” to live in. I live in one of those areas, Pacoima, in the San Fernando Valley. Often have co-workers scoff at the idea of living there, but I saw more crime occur while living in “desireable” West LA, than “dangerous” Pacoima. Just had a friend buy a duplex in Compton (to both live in and rent), many parts of that city are safe and in fact rising in value. 20 years ago Echo Park and Silver Lake were considered “no go” areas, now they are so trendy they are over priced.

          And the biggest myth is that your kids will suffer academically if they attend an LAUSD school. But smart parents have been taking advantage of the magnet programs for decades to provide their children with a private school quality education at a public school price tag.

          Reply
    • The MAD Consultant September 12, 2016, 11:44 am

      Now I dont live in LA but I have friends that live in plenty of awesome affordable neighborhoods near their work. They all don’t make Hollywood sized salaries, yet still find decent housing. Maybe instead of saving a ton you can save half a ton. Take your bike to some new areas and scope them out. You might like what you find.

      Plus think outside the box and don’t give up! The opportunities are always there, you just have to be willing to find them FF. If you have a landlord ask them if they know anyone looking for a great tenant in your target areas. Ask friends, coworkers, family. There is more supply out there than what’s on the internet.

      Reply
  • Kyle September 12, 2016, 8:55 am

    Good work selling the giant gas guzzling recliner. We recently sold my wife’s 2002 4Runner. Listed it on Craigslist at KBB value and sold it in 2.5 hours. It makes me wonder if gas prices being so low has folks buying big vehicles once again. SUCKAS!!! She absolutely loves her Prius and tripled her gas mileage.

    Reply
    • Mr. Money Mustache September 12, 2016, 9:26 am

      Oh yeah – the big guzzlers have been selling really well again from what I read in the news. Sales of new Trucks and SUVs are back at record levels, which means we all still have plenty of work to do.

      Reply
      • Andy September 12, 2016, 10:18 am

        “What I read in the news” ?!

        This can’t be the same MMM who wrote:

        “It is all Bullshit”, is what Mr. Money Mustache says, “You need to get the News out of your life, right away, and for life.” http://www.mrmoneymustache.com/2013/10/01/the-low-information-diet/

        I felt obligated to chime in and see if you need to punch yourself in the face or not ;-)

        Reply
        • Mr. Money Mustache September 12, 2016, 10:23 am

          Good point Andy. I try not read the news, but friends and readers keep forwarding me these links to articles pertinent to Mustachianism and sometimes I get sucked in. In theory, it helps me write more informed articles, but that could be bullshit on my part.

          Also, I do subscribe to the Economist (digital edition) and read most of that every week. Because it is a lot more into trends and less into sensationalism like “what the Politicians said last night and who is now mad about it”.

          Reply
          • Rick September 13, 2016, 11:46 am

            MMM, a tip – most libraries have the Economist available to read on-line (from home) for FREE!!! Just sayin’! :-)

            Love this site and have been a follower for years (just retired “slightly” early this year).

            Reply
          • Anirudh September 13, 2016, 2:09 pm

            In Sacramento libraries carry the digital version of economist that can be checked out the day it is released. Basically you don’t need to subscribe to economics anymore..

            Reply
      • Kyle September 12, 2016, 12:42 pm

        Subprime auto loans have skyrocketed as well and subprime auto loan delinquencies have hit a 20 year high.

        Reply
      • Supply Chain September 12, 2016, 7:10 pm

        I work in the automotive supply industry. In case anyone wants the sales figures:
        As of 8/31 there have been just under 2 million large SUVs, pickups, and vans (not including minivans–they’re considered midsize) sold in North America this year. Midsize trucks and SUVs add another 2 million; The midsize designation includes Q7s, MDXs, Tacomas, Pathfinders, etc.
        Total YTD automotive sales have been around 11.7 million.

        Reply
  • EL September 12, 2016, 9:05 am

    It is good news when smart bad ass people are doing anything possible to be free of the banks. I always read jeeps have great resale value and getting top dollar so quickly was destined for him. I think a future update is needed as to what car he will pick up, and how his living situation turns out.

    Reply
  • John Mustachian September 12, 2016, 9:22 am

    I’ve been learning a lot from your blog, but I am surprised to hear that you think Justin “must” drive through icy winter blizzards, and that this is a bad thing. My wife and I bicycle year round in Maine. Studded bicycle tires are $30-$50 and a simple set of rain gear can be purchased for about the same ammount. The snowy days are actually more enjoyable than the summer days! You don’t need a fat bike, just a simple mountain bicycle with studded tires will do just fine. Better yet, a cyclocross bicycle like my 7 year old fuji cyclocross bike that can work with road or mountain bicycle tires (and fenders) gives you maximum flexibility with minimum cost.

    Reply
    • Mr. Money Mustache September 12, 2016, 10:30 am

      Yup, good point John – winter cycling is totally fine in virtually all areas of the lower 48 (and many people do it in more northerly locations too).

      But because of offline conversations with Justin, I know he has to make regular visits to other towns 25-50 miles away, and even MMM would not force you to live a bike-exclusive lifestyle in those conditions: narrow country roads without shoulders, in the dark, in the winter, where nobody else bikes. You could do it, but it would be risky and consume too much of your time, even with a high-end electric bike.

      In situations like that, I instead suggest moving or redesigning your life so you don’t have to do the 50 mile trips in the first place. For example, if was forced to live in Toronto or Ottawa like some of my family does, I’d live and work downtown to eliminate the ice road driving entirely.

      Reply
      • lurker September 15, 2016, 7:05 am

        was in Montreal this winter and it was about minus 20 and snowing and folks were still biking everywhere! those canadians are badass and really nice!

        Reply
      • AFD October 2, 2016, 6:34 am

        Are you suggesting that one moves and incurs the expenses of selling and buying a home every time one changes a job? Seems to me that expenses would be much greater than modest car expenses especially if you owned your own home. If your renting I could see your point.

        Both DW and I started our careers in the West end of Ottawa, and hence bought our home here in an effort to keep our expenses low. Over time however, our jobs evaporated and we are now working at different locations in the city not serviced by buses. Cars are the only option.

        Reply
        • Mr. Money Mustache October 2, 2016, 4:18 pm

          Yes, AFD I sure am! Or more specifically, throughout this blog I have always suggested you design your housing and work situations as if cars were NOT an option. Only with that mentality will you weigh things correctly to end up with a lifestyle free from a car commute.

          For example, if your line of work requires frequent job changes, of course you might stick to renting. Later, you might start your own company or find a position that allows you to work from home. Changing cities, or even countries as I did (I used to live in Kanata and later West Ottawa as well) are always on the table as well.

          Different ideas work for different people, but as soon as you say “Cars are the only option” to yourself, you make it true.

          Reply
    • Michael Hart September 24, 2016, 3:11 pm

      What kind of speed can you get with winter bike tires compared to summer ones? I’m trying to decide how feasible it is to bike 25km (~15.5 mi) each way to school. In the fall, it takes me ~ 1hr. My alternative is bussing, which sucks.

      Reply
  • Ty September 12, 2016, 9:51 am

    Good job, Justin. I wish I would have gotten the picture at your age! And I have no idea what your degree is in, but I regularly hire late-20-somethings with a salary starting over $100k (plus health, 401k, stock, etc), so you’re age has nothing to do with your income potential.

    I want a Jeep Wrangler soooo bad! Always have, but even though I can now afford one, I’ve decided that I want financial independence even more. So for now we’re a 1 car family of six. If I can do it, anyone can do it.

    Best of luck, Justin!

    Reply
    • Jeepin Justin in PA September 12, 2016, 11:33 am

      I hold a degree in International Business with a side of French! Tons of things to consider– but I am always looking! ;)

      Reply
      • Ty September 12, 2016, 12:26 pm

        I’m in Seattle. Take a look at all of the business-related jobs out here with Microsoft, Amazon, Starbucks, Expedia, T-Mobile, Nordstrom, REI, Costco, Nintendo, etc. There are so many HUGE companies that are headquartered out here and the job market is strong.

        The city is expensive, but the salaries are high so you’ll be just fine. Washington doesn’t have a state income tax. You can easily bike/walk/bus the local area. Tons of outdoor activities. An no, it does not rain all the time. Lots of financial opportunities out here if you’re willing to move.

        Reply
        • Justin Jeep in PA September 12, 2016, 1:04 pm

          Seattle is a great city! I’ve been there twice and loved it both times. Would certainly be on my list of cities where I would be looking to move. West is best?

          This is something that I have recently tried to do– spend more time looking for career advancement. Always good to have the eyes open, even 2-4 hours a month on the weekend is better than nothing! Thanks for the insight thought, I will definitely be putting these companies on my radar.

          Reply
        • Dan September 12, 2016, 7:52 pm

          I second this. I also live in the Seattle area, and there are lots of high-paying jobs available here in the tech industries. As far as expenses go, I find that high rents or home prices are the worst of it. The difference in the price of other things isn’t too extreme. And anyway, as a Mustachian, you won’t actually be buying a lot of the stuff that other people do, so the price doesn’t really matter much, does it?

          Reply
  • Kelly September 12, 2016, 9:58 am

    Hey, a story from my neck of the woods! Good for you Justin, maybe Mustachianism is finally coming to NW PA. By the habits of most of my coworkers I had my doubts, but I’ve been living the car-free life in NW PA for three years now. It is possible and awesome to be Mustachian here :-)

    Reply
    • Jeepin Justin in PA September 12, 2016, 12:09 pm

      Slowly, but surely it is making its way towards us! Get too close to Cranberry Twp. and south and you can forget it! Over-priced housing, BMW’s, Audi’s, and JEEP WRANGLERS everywhere!!! I’ll gladly be on the front line of this revolution for Western PA!

      Reply
      • Trudi September 12, 2016, 2:17 pm

        Don’t be so quick to judge! Living the frugal life here next to Cranberry Twp and on the road to early retirement in 15 months! But I grew up in NW PA, so I’d have to agree with the recommendation to get out of Dodge and find someplace easier (and warmer!) to live a Mustachian life.

        Reply
    • Marcia September 12, 2016, 12:31 pm

      I’m not sure how old you are but…Mustachianism is/ was alive and well in my family (in NW PA). Admittedly, my father lived through the depression and my siblings and I range from age 65 to 44 (though the 44 isn’t much of a Mustachian). I still see a lot of frugality in my home town.

      My 23 year old nephew (ironically, Justin) is pretty good with money too (though has a love for trucks). Maybe it’s more of a “family” thing?

      Reply
      • Kelly September 16, 2016, 1:48 pm

        Oh I completely agree! I’ve met and are related to plenty of frugal people in NW PA. I was mostly thinking of coworkers who I have to listen to bemoan the state of their finances while buying lunch every day and living 20+ miles from work in downtown Erie, with plenty of cheap housing around. It gets old :-)

        Reply
  • roan.util September 12, 2016, 10:12 am

    I had the opportunity to drive a friends Jeep Wrangler Rubicon this past weekend. It is an interesting vehicle and I have no doubt it’s quite capable off road. However, their specific vehicle spends 99.99% of it’s time hauling one person that weighs no more than 140lb around on paved roads devouring no better than a gallon of gas per 15 miles on average. The tires on this monstrosity are off road tires. Which is insane when you consider how often this thing touches dirt.

    I know a Rubicon Wrangler isn’t cheap. They bought it used, but it is actually a relatively new vehicle. I guess I don’t understand. I could have some fun with a sports car (actually designed for pavement at least), but that would only encourage me to drive more and to earn speeding tickets.

    How do people make ends meet? My wife and I still have the efficient sedans gifted to us in college. Even with our roughly equivalent household incomes, I don’t get how you can carry a car note and afford everything else. And the vehicle is only a drop in the bucket of this couple’s spending problems.

    I’m not judging. I was gearing up for that exact lifestyle just a few years ago because I couldn’t rectify the idea of working a job I hate for 40 years while saving up for retirement when I’m an old man. I just genuinely don’t understand how most families get by.

    Reply
    • Adrian R September 14, 2016, 2:11 pm

      They only really “get by” because they are living on someone else’s money. The debt load eventually becomes crushing enough that a couple either has to go through years of relative austerity, or file bankruptcy. Math never lets you get away with something long-term.

      Reply
  • Carly September 12, 2016, 10:29 am

    I live not very far from this guy, and I agree with MMM, moving needs to be a priority. I live in Tioga County, PA, and the potential upward mobility here is horrendous. Our number one priority right now is finding a way to move. DH has a job interview in Ft. Wayne, IN next week, so anyone who wants to send good vibes our way, please do!!

    Reply
    • Allison September 12, 2016, 11:00 am

      Fort Wayne is a great city! I grew up there so I have my fingers crossed for you.

      Reply
      • Carly September 12, 2016, 12:11 pm

        Thank you, I appreciate it!

        Reply
    • Jackson September 12, 2016, 11:30 am

      Sending good vibes your way, big time! Pennsylvania to Indiana. You’ll be in sticker shock, in a good way.

      Reply
      • Carly September 12, 2016, 11:35 am

        Thank you! We would have a lot more opportunity to make a lot more money, and rent appears to be as, if not more affordable. I am so hoping he gets this. It’s his 3rd interview, and they are paying to fly him out for it and put him up in a hotel for 3 nights, so I hope that means it’s promising.

        Reply
    • Brian September 12, 2016, 12:31 pm

      Greetings Carly! I’m a Fort Wayne resident since 2009 and a transplant from Chicago. The cost of housing/living is exceptionally low in this neck of the woods, and the city has good income opportunities, a GREAT system of functional bike trails (i.e., trails that actually take you from housing to shopping/work) and a growing cadre of both dedicated and aspiring Mustachians. Hope the job interview goes well!

      Reply
      • Carly September 12, 2016, 12:34 pm

        That is fantastic! I am hoping with all my heart. This is a new process for us….we’ve always just kind of walked into places and walked out with a job. This interview process is nerve-wracking.

        Reply
    • Jonathan September 12, 2016, 1:05 pm

      Carly,

      What town? I married a girl from Mansfield. We live in (West) Philly. Tioga County is great to visit, but not sure what social or economic opportunities are there. (Outside of gas or farming (as a lifestyle, not to make money ;).

      Reply
      • Carly September 12, 2016, 1:15 pm

        I live in Mainesburg, which is about 5 minutes from Mansfield! We work at Kingdom!

        Reply
      • Carly September 12, 2016, 1:19 pm

        And It’s true, those are really your only options. The oil industry has declined rapidly here in the last 2 years, though. Gas prices going down is good for everyone except those who work and live in oil towns, and the environment. Apart from that, your options are very, very limited. We are lucky to have the jobs we have.

        Reply
    • Robert September 14, 2016, 12:17 pm

      Carly, my wife and I lived in Fort Wayne our entire lives until we moved about a year ago to Fort Collins, CO. Honestly, you’ll never want to leave Fort Wayne after experiencing the COL. Check out the neighborhoods just east of Foster Park, great homes and bike friendly to get to the rest of the city. Don’t let anyone scare you away from the “south side” of town, that’s where we spent 95% of our time and wouldn’t have changed a thing about our time there. Mind if I ask which company he is interviewing with?

      Reply
    • Julie September 20, 2016, 9:24 am

      We have lived in Fort Wayne for the past 15 years and I love it! Lots to do and the arts/music scene is growing. We keep adding bike trails, new river development starting & a thriving downtown area. Not to mention a nationally ranked zoo, and one of the best places to see a baseball game (even if it is minor league). Hope he gets the job – good vibes your way!

      Reply
    • NYC to Fort Wayne relocation September 20, 2016, 8:55 pm

      Fingers crossed! My wife and I recently moved to FW from NYC and are really enjoying it. It offers many large city amenities but without any traffic and at a huge discount. The city has also embraced a biking culture where trails are quite expansive. Definitely a place on the up trend.

      All the best with the job lead.

      Reply
  • Erin September 12, 2016, 10:57 am

    One note is about Justin’s cellphone bill. I’m from a rural area of a state near PA and Republic Wireless is not a good carrier there. I needed a Verizon service to get any reliability in cell coverage. So he may need to spend more to get decent service where he lives. My SO has Republic Wireless (it works great where we live and I talked him into it after reading about it here) but he gets almost no service when we visit my family. So I still have a Verizon plan for this reason. Sometimes rural areas increase your cost of living in different ways.

    Reply
    • Mr. Money Mustache September 12, 2016, 12:03 pm

      Hmm.. Republic roams to Verizon automatically, unless they have changed that agreement (?)

      In my own (unscientific) testing during cross country travel, I have found that multi-carrier plans like Republic and Google Fi had the most coverage in remote areas (comparing to companions running att, Verizon and t-mobile)

      Reply
      • DrWillieMo September 12, 2016, 8:10 pm

        Also there is http://www.totalwireless.com. Great Verizon network for half cost. 35$/mo equals unlimited talk&text and 5gb data (I’m running on a 20$ MotoE phone in rural GA

        Reply
      • Anonymous September 13, 2016, 4:56 am

        Might depend on your phone. Some devices can’t use all network technologies, so they can’t use all of another carrier’s coverage, just a subset of it.

        Not an issue with Google Fi, since the only phones it works with all support every band. Might be an issue with some of the cheaper Republic Wireless models, though. Worth checking what cell technologies and frequency bands your phone has and which ones the underlying carriers provide.

        Reply
      • David October 3, 2016, 5:22 pm

        I can’t speak for Republic because I have not used it. Tracfone is a better fit for my needs. Tracfone uses Verizon towers but not all of them. Possibly Republic and Verizon have a similar contract where Republic only uses some of Verizon’s towers. That would explain why some places get better reception with Verizon than Republic.

        Reply
    • Daryl September 13, 2016, 1:57 am

      There are still good prepaid providers on every network that should be about half that. PagePlus for Verizon, Cricket for AT&T should cover most rural needs. (Just two random examples from off the top of my head)

      Reply
  • S.G. September 12, 2016, 11:05 am

    Two points:

    1) I am down with recommending he move, but my advice regarding roommates would be “YMMV” simply because finding a roommate in a rural area could be difficult depending on population and demographics (i.e. lack of singles looking to share).

    2) I understand and agree with getting rid of the Jeep, but sometimes people (MMM and others) seem a bit dismissive of low frequency/high consequence driving needs. Specifically 4WD. Many people in rural areas should at least have AWD if storms or ice issues are a relatively frequent occurrence and while many people manage to survive with small 2WD vehicles in these locales, I think the additional expense of the AWD vehicle (especially if offset with other tradeoffs) is justified. I need 4WD probably a dozen times per year (I’d need it more if I wasn’t blessed with a south facing driveway on the south side of our mountain), but every time I use it I wonder what the outcome would be if I didn’t have it. If I was lucky I wouldn’t get out the driveway at all. If I wasn’t I would be in a crumbled heap on the side of the road.

    Reply
    • Carly September 12, 2016, 11:21 am

      I totally agree. The culture in this area makes any sort of sharing economy incredibly difficult, which is odd because everyone here is so poor. Nobody wants roommates, nobody wants to carpool, and a jacked up truck is a badge of honor. We were lucky enough to find a tiny little cottage to rent for $550/mo that is 5 miles from our workplace. We are able to bike there in the summer, but it is difficult and dangerous for the reasons that MMM has already mentioned. Because we are so close and on a main road though, we are able to share a 2006 Chevy Cobalt that we paid $3,000 for. Visiting our parents in winter and spring is difficult though, because they all live out on tiny dirt roads that are poorly maintained. I often wonder what everyone here is thinking, and curse the fact that I was born here. I don’t even know why we pay taxes when the roads are never maintained or plowed, and the schools suck beyond belief.

      Reply
    • S.G. September 12, 2016, 4:12 pm

      I just followed the link to the AWD analysis, and while I think there are many good points, I think a lot of it comes down to agree to disagree territory. It just depends on your priorities and would contend that it can easily come down to your specific goals and circumstances. But one quote struck me:

      “But it is useful if you need to plow through unusually deep snow in conditions that would normally get you stuck (for example a steep snowy driveway, or if you run a snow plow). It’s also useful on extremely steep unpaved roads or in areas with no roads at all – places you are unlikely to need a car.”

      The quote is a bit extreme, and once you deflate it a little bit it is actually a situation that many rural people are in on a regular basis: steep roads, un-plowed roads, unpaved roads, etc. I have been in plenty of situations within a couple miles of my home where the 4WD got the job done and 2WD didn’t stand a chance (I don’t have experience with AWD to comment on the different performace of AWD transmission). When I am no longer working and I can choose to stay home on the worst days I will likely switch to 2WD exclusively as the likelihood of getting caught out of the house in such conditions seriously drops. But until that time, or I move to town with their nicely paved and plowed roads and concrete driveways, I’ll want to have access to a 4WD vehicle.

      Reply
      • Carly September 12, 2016, 6:11 pm

        Exactly! My first car was a Dodge Neon, and there were plenty of times it just would not make it up the hill leading to my house, and my dad had to have me leave it in the church parking lot a mile from home, and have him come pick me up.

        Reply
    • David B. September 13, 2016, 7:34 am

      I’m not so sure about the 4wd thing. I lived in the Upper Penninsula of Michigan for 2 years and my buick with front wheel drive and snow tires often would be a better vehicle to drive than the 4wd (non snow tired) trucks that work had us hauling around in.

      Reply
      • HomeCook September 13, 2016, 1:13 pm

        David, from may experience , unless the 4×4 has winter tires, the car with them will do better overall.

        Reply
    • Mark September 13, 2016, 9:59 pm

      Just a point re 4wd vs awd.

      Most modern awd will go where a 4wd simply can’t. In my experience it is WAY better!
      This is based on the computer analyzing the wheel spin / traction. Works in conjunction with the anti lock brakes. One wheel breaks free the others automatically start(just don’t be stupid on the gas pedal), the spinning one quits, or at least backs off, and now you are moving. = 3wd immediately. On a 4wd usually there is just one front wheel with power and one back wheel with power, i.e. 2wd not 4wd and this is full time. Even if you have a limited slip differential, it’s not as good as awd.

      I know this was true for my old chevvy awd AstroVan comparing to my dad’s 4×4.
      Loved my chev awd AstroVan in winter. Had 8 inches clearance for snow drifts etc. Worked great for camping in the summer too. I am in Alberta.

      Reply
    • Colin September 15, 2016, 8:54 am

      There are plenty of 4WD/AWD vehicles out there that don’t cost $30k and require financing.

      Reply
  • Jess D September 12, 2016, 11:34 am

    “Your student loans are at a shocking 6-7% interest rate.” Spoken like someone who never had student loans. Two of mine were 6.8% and one was 11%. I paid them off 5 years ahead of schedule thanks to my Mustachian lifestyle, but for many of us who went into college completely financially uneducated, student loans with high interest rates are pretty non-shocking.

    Reply
    • Kevin September 12, 2016, 1:35 pm

      I think your last sentence there may be the key, Jess. We went into our education with no financial sense.

      I now know that $55 k is an insane amount of student debt, and I had interest rates from 5%-10.5%. I would never do that knowing what I know now, because it is insane.

      Reply
      • Jess D September 13, 2016, 8:19 am

        Strongly agreed. Again, I paid my loans off early so it all worked out in the end, but I definitely could’ve been in a much stronger financial position now if I’d graduated debt-free. I sometimes wonder what went wrong–what financial know-how was passed on to 17-year-olds who DIDN’T take out college loans that I missed out on? Do I blame my parents, my school for not clueing me in?

        Almost all of my friends graduated with student loan debt. It’s a fact of our lives.

        Reply
        • Kevin September 13, 2016, 12:39 pm

          Yes, many I know left with student debt as well. I’m in the middle of my own accelerated pay off.

          My education would have looked much different had I been more financially savvy. It’s hard to figure what went wrong–personally, I bought in to the narrative that a college education was essential. I think operating under that assumption caused me to not consider the full effects of my decisions, or the cheaper possibilities.

          Reply
    • Mr. Real Estate September 14, 2016, 2:28 am

      I’ve heard student loans really went up after I graduated in 2013. I still have one at 3k @2.9%. All the loans I took were subsidized with not interest accruing until 6 months post grad. My first 2 years were at a private university and racked up some serious debt, last 2 were at a SF State and after my grants and loans I ended up graduating with less debt than I started. I also lived in a dining room, shopped at grocery outlet, received a modest merit and athletic scholarship, and loved public transportation.

      Who was the holder of your loan? Both of mine were federal so that could be a reason.

      Reply
      • Jess D September 20, 2016, 12:47 pm

        Wow! That makes me feel like interest rates went DOWN after I went to school. Though I suppose our personal stories are not necessarily indicative of national trends. Regardless, way to go on your frugal college lifestyle.

        I graduated in 2009 and my loans were all federal. I worked part-time, didn’t own a car, took public transit everywhere, and got all my books from the library. I had classmates who acted like they had money to burn–and for all I know they did–but I’m glad it never rubbed off on me.

        Reply
  • simeon September 12, 2016, 11:42 am

    “If you have the amazing privileges of a good education, reasonable health, and a strong work ethic, there is no reason you can’t make over $100,000 per year, at a job you really enjoy, and live within walking distance of work. ”

    Any further advice on pulling this one off?

    Reply
    • Frugal Bazooka September 12, 2016, 11:17 pm

      lmao! MMM does throw that 100k salary number out rather glibly doesn’t he? It so reminds me of the scene in LOST IN AMERICA when Albert Brooks and wife have lost their “nest egg” and end up looking for jobs in Bumf*ck, Timbuktu. Brooks goes to the local employment agency and fills out the application for a job. The employment agent looks at his salary requirements baffled. Brooks innocently asks where the list of $100,000 jobs are and the agent can’t stop laughing…cause ya know, there are none in Bumf*ck, Timbuktu. Brooks ends up taking a temp job as a crossing guard.

      Having said all that, there are a lot of high paying jobs if you’re willing to figure out where those jobs are and go get them. If you have other requirements in your life that don’t allow you to have the heart of a mercenary when seeking employment, then you’ll probably not land the $100k type job.
      Another reality is if you graduated with a liberal arts degree and don’t like working for companies that seek profit, it will be much tougher to find that higher paying job.

      Reply
    • Kris September 15, 2016, 7:23 am

      Had to laugh (to put it nicely) at that line. My husband is a drafter and works ethically and hard. His top pay in the past was ~$60K–less than that now. I have two sons: one a software engineer (he’s starting out of school at $60K plus tons of benefits; expect he’ll be over $100K by 30) and one is a poetry major (need I say more?)

      Reply
      • Adam September 15, 2016, 11:44 am

        I have a music performance degree and hit a $50k salary at age 30. My wife, with a psychology degree she doesn’t use, makes more than I do! In spite of antimustachian behavior like two cars and $400 heating bills, we’re still on track to retire the same year we pay off our (DC-area) house when I turn 50.

        Sure, my kid brother majored in something useful and makes nearly twice what I do, and sometimes I want to go back and slap 17-year-old me in the face with a limp paycheck. But financial independence is possible even for those of us with educations that some might disparage!

        Reply
      • Aimee September 16, 2016, 8:32 am

        I’m an Executive Assistant in NY with no college degree and I make very close to 100k. The jobs are out there….you just have to find them.

        Reply
        • Jennifer September 26, 2016, 11:35 am

          I still feel like this needs in depth clarification. That is a lot of money. I have a graduate degree in a field I love, and have always counted on living on a lot less, which has never been a problem for me. Throwing that out there like it is a fact is another story. Proof is a nice concept for a money blog. Mr Money Mustache gets on my nerves because he (or his character) makes a lot of assumptions like they are facts but I don’t see them being explained. I would love to see an article explaining his statement, and I am sure the American workforce would agree.

          Reply
    • rando September 20, 2016, 7:52 pm

      My friend is a real estate agent in Boston and makes >$200k. She likes her job. That’s probably the easiest field to get into without much training. If I had to leave scientific research, I’d build up my programming and stats background and do software development or something.

      My parents were lawyers and hated their jobs, but my mom made >$500k/y before she retired (venture capital contracts) and my dad was >$250k/y. Most of my current lawyer friends now face similar tradeoffs.

      Profs at private colleges can make >$100k/y. Doctors obviously make much more. The training sucks, though.

      Reply
  • Cash Flow Diaries September 12, 2016, 12:01 pm

    No! Not the jeep!! Haha I love my jeep but I dont really drive it and its just about paid for so it doesnt eat up too much of my finances. You did a great job helping him out and he is clearly in a better situation now.

    I recently made a huge change to free up money as well which consisted of moving from Austin, TX to Indianapolis. Crazy right!? Well I dropped my mortgage in half, dropped my gas bills by 90% and now live in an area where i can build my rental portfolio easier. Win, Win, Win!!

    Reply
  • Dave Foster September 12, 2016, 12:08 pm

    While I admire this young man’s determination, he might want to draw up a more realistic budget. He has $0.00 for such things as clothes and entertainment. Even if he shops for clothes at the Goodwill, and goes to the movies on Dollar Night, he is going to spend SOMETHING. He loves travel? Where is it on his budget? Taking a realistic look at income and outcome is one of the first steps in getting finances in order, and I do not see that he has done that yet.

    Reply
    • Jezz UK September 12, 2016, 4:17 pm

      True, but he is making $30K more than he is spending. Clearly if he doesn’t mention a big outlay for clothes, it’s an area in which he is already frugal and his costs are (in this scheme of things) insignificant. Say $300 a year for jeans, T-shirts, underwear and new sneakers, most of which can be made to last for years…?

      Ditto entertainment and travel. On a frugal approach, it’s still way less than he earns, and he’s still well on the way to paying off his debts and achieving FI.

      Reply
    • Anonymous September 13, 2016, 5:02 am

      Regarding entertainment, that’s already on the list: Internet, $50/month. Piles of entertainment and education alike, at your fingertips. Optionally add $10/month more for a bottomless supply of movies and television.

      Reply
    • Jeepin Justin in PA September 13, 2016, 12:41 pm

      Fortunately, I receive a lot of my clothes either from work or gifts from family. The actual money that I spend on clothes from the year is less than $75. I am incredibly grateful for my family doing the shopping for me and getting a stipend for work related attire.

      As for entertainment. I spend a majority of my time not at work outdoors. Every spring I spend approximately $20 on a fishing license for the year, and I am set.

      As far as the travel, this is probably my biggest success. I have found ways to travel all over for just silly amounts of money. My most recent adventure was this summer. I took a 10 day trip to Ireland. Flying from Pittsburgh, the flight was $1,250. With a little bit of research, math, and patience, I was able to score a flight leaving from Toronto to the same destination for $450 USD. But wait! I have one of those credit card gimmicks where if you sign up you get a bazillion points and can fly anywhere– covered my flight. I parked my car a friends house in Toronto, had to spend a couple hours getting up there, but got to visit friends! Free parking. Next, when I got to Ireland, my life-long best friend was doing graduate school and I just stayed with him. All that was left was food and drink! “Game Day Special: Burger and a pint, 10 Euro.” Can’t beat that!

      With all that said– I know I have lucked out, I know people from all over. Fortunately they let me stay with them. Every little bit helps. Travel is a huge passion of mine, and if sleeping on floors is what it takes. That is a small price to pay.. or save?

      Reply
      • Nederstash September 13, 2016, 2:17 pm

        I love scoring travel deals. Unfortunately in Holland we don’t have very great credit card systems to score points (in fact, credit cards aren’t even accepted in regular stores like supermarkets, drug store etc). Still managed to do a 12 day holiday traveling through Japan for 1200 euro. Including *everything*, from (direct!) flights to food. Skyscanner is an awesome website for travel deals.

        Reply
      • Jezz UK September 13, 2016, 4:19 pm

        Sounds like you could have a useful side hustle in writing about your experiences and money-saving tips! Keep at it! I loved this story, and wish you continuing success!

        Reply
  • Jackson September 12, 2016, 12:13 pm

    Any advice on how we could be a 1 car family? Both cars paid off, definitely need one but have a 2nd (2003 Toyota) which only has 30 000 miles on it or a bit over 2700 miles per year since purchase.

    Trouble is, every one of those 2700 miles per year has been a necessity or for events that aren’t necessities but can’t be rescheduled – driving to help an aging relative in need of help, DIY home maintenance issues that couldn’t wait till the other car was here, Doctor and dentist appts, some social events that didn’t have flexible schedules ( political rallies ir need- ups, book clubs, funerals etc).

    I bike whenever possible. But we can have some very serious winters here..and also some storms where it isn’t safe to bike. Those auto insurance costs, routine maintenance inspections etc.Would love to ditch those costs.

    Reply
    • Chris B September 12, 2016, 3:13 pm

      -Uber or similar.
      -Rent from a friend.
      -Rent a 2nd car when needed, “we’ll pick you up”
      -Rent a truck from uhaul or pay the home improvement store to deliver.
      -Also, that low mileage per year could qualify you for some very low liability-only insurance rates if you shop around for a company that prioritizes mileage.

      Reply
    • steve poling September 13, 2016, 5:52 am

      Put the unused car up on blocks, cancel insurance, and re-activate it when needed. The inconvenience will provide a good gauge of how much you REALLY need it versus just think you do.

      Reply
  • frugal okie September 12, 2016, 12:42 pm

    Nice going Justin! A quick comment on the 401k.
    I’ve spent the past few months trying to convince HR at the small business where I’m employed to switch the 401k. The average expense ratio in our current 401k is 1.50%, which is insanely high! Thankfully there are way more options for small businesses now compared to even 5 years ago. As MMM mentioned, Vanguard and Betterment (I’ve also researched Employee Fiduciary) are all much better options.
    In my case, after months of trying to convince the owners to switch the 401k, they refused. Which brings me to my point, I learned through the process that we have a “self directed brokerage account” (SDBA) window in our 401k. So, if all else fails you can open an account with a brokerage firm, TD Ameritrade in my case, and have access through the 401k to low cost funds. Check with the 401k plan and see if that’s possible if moving the 401k doesn’t happen. If you don’t feel comfortable being self-directed, then I suggest you get comfortable! Let’s fund our own retirement accounts, not the 401k advisor. If you need motivation, look up an expense ratio calculator and calculate the potential difference in returns between an expense ratio of 0.25% and 1.25-1.50%. I suspect you’ll find time to become comfortable with self directing your 401k when you see the power of compounding savings over time!

    Reply
    • Mr. Money Mustache September 12, 2016, 12:50 pm

      Great comment Frugal Okie! Self-directed would actually be super-easy: simply buy the Vanguard exchange-traded fund known as VTI. It’s the entire stock market in one purchase – only stock you ever need to know about.

      Also: Holy shit, I can’t believe anyone is still charging 1.5%. That’s roughly a FIFTH of your expected long-term return – vaporized before it even gets a chance to work for you.

      Reply
      • Mr. Real Estate September 14, 2016, 3:01 am

        I currently hold VFINX(sp 500 investor) and NAESX(small cap investor) looking to switch over to sp500 admiral this month.

        compared to VTI. all three have very similar 3,5,and 10 year returns. Once I get into the admiral class the expense ratio will be identical with VTI and just slightly lower than small cap. If the absence of a minimum investment the reason you suggest VTI over others?

        Reply
        • Mr. Real Estate September 14, 2016, 6:00 am

          Correction: VISGX for small cap

          Reply
    • Anonymous September 13, 2016, 5:08 am

      Work from the bottom up. Write up a step-by-step guide to switching to the self-directed model and investing in a Vanguard exchange-traded fund. Talk to several co-workers about the expense ratios. Publish your guide as an internal resource. If a significant number of employees end up going with the self-directed option and buying Vanguard funds, you might have an easier time convincing HR to offer those funds directly and get an even better deal.

      Reply
    • steve poling September 13, 2016, 6:00 am

      Maybe it’s the tinfoil hat talking, but I think that in a small company the 401k provider is generally chosen from the owner’s golfing buddies, and not in the best interests of the employees. I was shocked when I looked up expense ratios and saw how I was being gouged by the 401k provider. I learned more in one week of MMM reading about retirement than I did in one decade’s worth of happy horseshit from the 401k guy who just happened to be the same guy after the company changed 401k servicing companies. Funny that.

      Reply
    • Rob September 13, 2016, 12:42 pm

      That’s funny, your average Canadian pays in the range of 2.75% for a typical equity MF.

      Reply
  • deadrubberboy September 12, 2016, 12:55 pm

    Question on the 401k/retirement in 10-20 years:

    How does Justin access those 401K funds before “official retirement age”?

    Reply
  • SmartFamilyMoney September 12, 2016, 1:03 pm

    That’s awesome that he was able to figure things out so young and get on the path towards financial independence! I wish I had figured it out before having kids, since kids make everything a little more complicated. If he does get married and have kids some day, he will be in a great position.

    Reply
  • The Money Habit September 12, 2016, 1:06 pm

    Congrats to Justin!

    The rent survey closer to work is a great suggestion. I live in NYC and I generally find there are good deals to be had in the best of neighborhoods with some looking. Rent-stabilized units, small apartments at the top of a 6 floor walk-up (more exercise for free!). Hope Justin takes advantage of that advice.

    On cell phone plans, I second the suggestion to look into Google Fi. They include T-Mobile, Sprint, and U.S. Cellular in their network so hopefully you’ll get the coverage you need in your area with them.

    Reply
  • Dan September 12, 2016, 1:19 pm

    I think I should point out that MMM’s assumption about Wrangler depreciation is not true. Yes they aren’t comfortable to drive, yes they eat a ton of gas, but the depreciation is insanely good! In most areas you can sell your Jeep for $2k above KBB. They basically bottom out at $8k regardless of the mileage or condition.

    I have Jeep and have decided to keep it because I have hobbies that take me on dirt roads. I need a high clearance vehicle to get there. The Scion xA just won’t do! I’d love to have multiple vehicles but that’s not in the cards. When looking at a used Outback the price to own per year is basically equal to the Jeep because the resale on the Jeep is just so crazy high.

    Reply
  • HieNA September 12, 2016, 1:28 pm

    There were a lot of things I got from that article – lots of good motivation on things to consider revamping. In particular multiplying a monthly expense by 173 to see how much I would lose in 10 years versus investing it. Where I live, in Canada, our cell phone bills are much larger … it’s just how the market is. We gripe about it on cbc … you can read the explanations there. There are canadian cellphone companies that offer plans as low as $20/month … but they are only allowed to offer the plans to americans. … so that’s the deal we have up here. Also I am jealous of the rent in PA. I rent a one bedroom suite (with one full bathroom, a kitchen and laundry all to myself) for $850. $750 for four bedrooms sounds amazing to me!! I also make from $50-60,000 annually. I’m pretty much in the same boat but my rent is much, much higher than the lucky gentry of PA. Jealous. I’ll see if moving to the east of the Rockies would be a better deal for me. I am living in a city that’s notorious for a housing crisis (Vancouver).

    Reply
  • Kevin September 12, 2016, 1:28 pm

    MMM — I would love to see your case study of the Toronto $130k/year spender. Your no holds barred assessment would surely be an entertaining read. Personally, I cringed through the whole article and couldn’t even read it through without taking breaks from the insanity.

    I would bet you could even maintain the constant travel and have him retired in 10 years or less!

    Reply
    • Lynne September 12, 2016, 6:07 pm

      Yes please! That would be a fun post. :)

      Reply
      • HeadedWest September 13, 2016, 7:17 am

        I read that piece and it seems like the Toronto pharmacist is just 3 steps away from getting on a pretty frugal path. They already have the “rent instead of buying insanely overpriced detached Toronto house” part down. If they (1) eat and drink at home more now that friends are settling down (2) travel mainly within North America and (3) invest the difference saved, they could probably retire 9 years from now. And I’m sure there are plenty of potential SOs who would be impressed by this plan.

        I’ll bet if they limit restaurant/bar hopping to twice a week they’d save a ton of $ and it would be just as much fun because the experiences would be “new” again (and fewer hangovers the next day at work). For years, I spent most of my disposable income at bars and restaurants and it eventually dawned on me that I was doing it so much it wasn’t fun anymore. It had become an almost unconscious habit, and not a very good one.

        Reply
        • Lynne September 13, 2016, 11:50 am

          Yes, for a few years after university I ate out a lot more too – never spent ridiculous money on it, but definitely more than I spend now. I agree it’s more fun now that I’ve cut back. It may be that some of us need to have that experience before moving on, so perhaps there is some hope for the Toronto pharmacist…I do have trouble relating to the way he seems perfectly happy to have his parents subsidize him, but then, my relationship with my parents is a very negative one, and I don’t really get how *anyone* feels comfortable making horrible financial choices in the belief that some family member’s always going to be there for them as a safety net.

          The only person you can REALLY rely on being there for you is yourself, and you should make your decisions accordingly. (I am reminded of the advice often given to young adults to save money by “moving back home,” which always made me roll my eyes at how blindly privileged it is. Surrrre, move home. I already live at home. *My* home. And I have to pay rent to live there! Not saying a family safety net is a bad thing, but sometimes people who do have one assume it’s both universal and that it’ll always be there for those who have it, which is not grounded in reality.)

          Reply
  • Taylor September 12, 2016, 2:04 pm

    Hey Justin – nice work!! I am also 25 and currently in the process of getting rid of my totally unnecessary car, a Subaru Crosstrek :) Your Jeep pictures have definitely inspired me… headed to the wilds of Portland this evening to finally take the pictures for my Craigslist post! Yay for discovering Mustachianism in our 20s :)

    Reply
    • Dan September 12, 2016, 2:59 pm

      Interested in that you consider the Crosstrek such a bad choice? Are you looking to get a cheaper/older car? Or do you not need anything with AWD and high clearance?

      Reply
      • Taylor September 13, 2016, 12:03 pm

        My apologies, didn’t mean to convey it’s a bad choice, just that I personally don’t need a car anymore. My work commute now consists of a one-mile walk each way, so I am going car-free. The Crosstrek itself has been a great, comfortable car! Enjoyed having it, it’s just no longer necessary :) I also leased it when it was brand new, when I should have purchased an older, used car. Lesson learned!

        Reply
    • Jeepin Justin in PA September 13, 2016, 12:27 pm

      It is a truly liberating experience! It clicked for me when I read about investing a monthly car payment instead of spending it on a car payment. Do the math yourself and it will amaze you how much that $200, $300, $500 car payment will be with compound interest even at conservative return rates!

      The other thing that completely sold me that selling the Jeep was the right thing to do: My Jeep was used for transportation purposes, occasional trail riding, and even more minimal hauling. The Jeep had A/C, and that was the only option. Brand new vehicle. No power door locks, no power windows, nothing– just A/C. I was paying a stupid amount of money for a box with 4 wheels (that did look sweet..), but it was impractical! As cool as the Jeep was, the idea of being retired before 65 is WAYYYYYYYYYYYYYY more badass!

      Reply
  • Dee September 12, 2016, 2:05 pm

    Great job Justin and as you said, it’s a marathon so keep it up!

    On a side note, holy crap re: the Toronto Life article! After reading that, I really don’t want to be associated with the designation “Millennial”. And I’m drawing some serious parallels with the book I just finished (The Wolf of Wall Street). With that kind of excess, you need to keep buying larger and crazier to get the same thrill… therefore, how long before a $200 bottle of wine doesn’t cut it and drugs enter the picture to “increase the thrill”.

    Reply
  • D September 12, 2016, 2:21 pm

    Nice article.
    Very unfortunate or opportunistic title given it is suicide awareness month, so thumbs down on that count.

    Reply
    • Mr. Money Mustache September 12, 2016, 2:50 pm

      Ooooo, that is unfortunate indeed. Lack of awareness on my part and maybe a byproduct of my Low Information Diet – sorry.

      On the other hand, maybe we should pick a different month to be Financial Suicide Awareness month, where consumer loans and brand-new cars are appropriately stigmatized!

      Reply
  • Chris B September 12, 2016, 3:19 pm

    When the hell is someone going to create the software that makes it unnecessary to physically commute to an expensive office to push buttons? Multi-billion dollar opportunity and no takers!

    Reply
    • Jess D September 13, 2016, 8:28 am

      This made me laugh out loud. :D

      Reply
    • Kathy Abell September 13, 2016, 10:17 am

      Before I retired I actually enjoyed coming in to my office to work for two reasons:
      1. It was only an easy six mile commute on surface streets (no freeway driving). (This was long before I’d ever heard of MMM, but I’m sure he would give me a face punch now for every non biking excuse I might give him.)
      2. It got me out of the house five days a week (I would get too distracted work I g from home).

      Although I didn’t telecommute, a number of my programmer colleagues often did. I recall more than one occasion where I would have to walk over to their cubicle to reset their deliverable processor workstation, that is, manually PUSH the power BUTTON. (These workstations were not covered by our desktop IT support staff, and these occasions would invariably occur when no project workstation support personnel were available to get the programmer’s machine up and running again.)

      Another time we were executing a many days long test over a long company holiday period using a data recording media that had to be changed on a daily basis. Since I was the team member who lived the nearest to our work site, I volunteered to perform this task on the operator’s days off. Although a Team Lead at the time, I was trainable enough to learn how to remove the filled media and replace it with a new one. LOL

      My point is, even with the best software available, sometimes there is a need for someone to physically push a button (or change a data recording media). ;)

      Reply
  • DebtFree2003 September 12, 2016, 5:40 pm

    You stated, “the US median income is currently $52,000, meaning that half of workers earn above this amount, and half below”.

    I think you may have meant to say, “half of HOUSEHOLDS earn above this amount, and half below”.

    If half of the workers in this country were earning $52,000 a year, I don’t think we would be riding to hell in this hand basket.

    Reply
    • Mr. Money Mustache September 13, 2016, 9:34 am

      Thanks, Debt Free – I have corrected the article to point that out.

      As for the handbasket, I guess it depends on what your goals are. Does the median worker really have any genuine shortage of money? Or are they burning most of what they have on interest payments on luxury goods like cars?

      I think if we made even more on average, we would see even higher levels of consumption in the middle class – more leather-appointed racing pickup trucks, more boats, more suburban McMansions with their air conditioning set to 68F on a 100F day.

      I’m all for greater wealth for the individual, but I sure hope we can first learn to find other things to do with it, besides buying ourselves an ever-greater quantity of resource-expensive disposable treats.

      Reply
      • Kyle September 13, 2016, 10:53 am

        Data for 2015 was just released and this household value increased by 5.2% to $56,500 for what it’s worth.

        Reply
        • NG September 14, 2016, 6:52 pm

          Also, the median annual income for full-time workers is approximately $43,000 (according to the Bureau of Labor Statistics, as of the second quarter 2016), which is not tremendously less than the household income (and well clear of the “hell in a hand basket” standard, presumably).

          http://www.bls.gov/news.release/wkyeng.t01.htm

          Reply
  • Linda September 12, 2016, 6:50 pm

    $480 for rent. Sigh. I’d take $1100.

    Reply
  • kindoflost September 12, 2016, 7:33 pm

    If the standard (or cliché) doctor’s answer is “take an aspirin and call me tomorrow”, the standard answer to these cases could be “pay all your high-interest debt and call me when you are done”.

    Reply
  • Adventures with Poopsie September 12, 2016, 7:56 pm

    Great work Justin, love the enthusiasm you came back with!

    We are trying to sell a car at the moment and having no luck, so this weekend we are taking some new and improved photos! Thanks for the inspiration!

    Reply
  • sw September 12, 2016, 11:20 pm

    “… the US median income is currently $52,000, meaning that half of workers earn above this amount, and half below …”

    That’s the median *household* income, though, not individual.

    Reply
  • Nath September 13, 2016, 4:56 am

    Good article and wish the guy well.
    No mention of what car he is going to buy now he sold the Jeep? Even if he goes for the efficient used Japanese hatchback he will probably require a loan again?

    I notice he loves travel, as does almost everyone but travel is a luxury item and there is still a long way to go before you are back on track financially. I think your best to work your butt off for the next few years if you really want to get ahead.

    Reply
  • Luke September 13, 2016, 8:15 am

    “Justin currently lives in rural Western Pennsylvania, which is a collection of very small towns which are very far apart. This means he leads a life with a lot of driving, which means he needs to have a car that is incredibly well optimized for frequent long drives. ”

    SO TRUE! That’s why you will see this dude driving his 2002 Toyota Prius around the hills of western PA, and still getting 50 mpg. I got it due to inspiration from the MMM article “Meet the man who drives for free.” Bought it in Feb. 2016 for $800. Already, it has saved me close to $1000 in fuel costs. Justin, for rural western PA, a Prius simply cannot be beat!

    Reply
    • David October 3, 2016, 5:55 pm

      Living in a rural area I agree with the description of small towns that are far apart. From my house it is 40 miles to the nearest town of over 5,000 people, 80 miles to the nearest city of 10,000 and 25 miles to a city of 50,000. This means more driving than MMM would like but I have no desire to move just to save money on transportation. Moving here has allowed me to live a simple lifestyle that lets me save much more than I could living in a city. Transportation is only one of life’s expenses. Being able to harvest much of my needs from the land lets me trim my other expenses enough to offset the higher transportation costs that come with living in the sticks.

      Reply

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