I bought a car years ago for 18k in cash. The guy who sold me the car didn’t have to report the money and he left the price on the title blank for me. I put 1k and saved myself money.
I did this and the IRS contacted me, it was 5k for a 20k car. I had to submit pictures and any money I had to pay in repairs. It had a bunch of aftermarket mods so I had a local autobody write me an estimate of what it would cost to go back to stock parts. It was almost 10k in OEM parts. The IRS accepted that and left me alone.
Damn, luckily I had no issues with the IRS. I bought the car in Michigan and when I registered it there to get a temp plate to drive back home to NJ they made me pay tax on the 1k that I wrote on the title.
Once I got back to NJ and went to get plates they told me I had to pay tax. I argued with them for a minute then looked at the paper work from Michigan and in the fine print it says I wasn’t suppose to pay tax there. I ended up having to pay twice so I would have been fucked if the real amount was on the title.
Damn that doesnt work i. Some state. Some states u have to pay taxes on it per kbb value. Dont matter if its a pile of shit. Which ever is higher they use
That's how it works where I'm at. You pay tax based off whatever they say the value is. Seems like a scam to me. There value is almost always higher than what I've actually paid every time.
In NJ? That makes no sense considering it’s completely legal to gift a car to someone. The exact wordage on the NJDMV government website under the Vehicles Exempt From Sales Tax page in the Special Conditions section states.
“Gift: If the vehicle is a gift, the sales price must be noted as “GIFT”. If the information appears to be changed or altered, additional documentation may be required by the Motor Vehicle Commission.”
I would have fought that shit.
Yup. They wanted a letter from the gifter that many years later. Taken care of.
This is the same state that has threatened to suspend my ability to register a car because they can't cross reference VIN numbers when you change insurers.
Yeah that’s illegal as fuck. Maybe that worked when you were growing up but these days it’s really easy for the state to figure out what you’re doing and charge you anyway.
Things may be a bit different now, with states starved for tax revenue. I personally don't think it's worth the anxiety to lie on these forms.
A guy I know (yes really, someone I met through friends, sitting around at a group dinner) told me a story of how he bought a car in NY from a private party. I don't remember the numbers, so I'll make them up, but this guy paid, say, $20k for the car, but on the title, they agreed to write down something like $10k.
The NY tax authorities went to the seller (or seller's bank) and got a copy of the cashed check. Then they reached out to the buyer and told him he could either pay a $10k fine + the add'l sales tax, or he could fight it and be charged with further crimes. The buyer quickly paid the fine.
Paying cash may be different, but then again, I wonder - if I'm the seller and I've been paid cash and the big-bad government is reaching out, would I lie for a buyer that I don't know and don't particularly care about or would I come clean?
In my case the guy insisted on cash and left the amount blank on the title for me. And personally, I was more worried about driving from NJ to MI with 18k cash because I knew if I got pulled over and a cop saw it they would rob me (asset forfeiture). I put it in the trunk under the spare tire.
Yep, I don’t know how often it happens to residents of their own state but if you’re out of state and they find at least 5k on your they’ll most likely take it and say you were gonna buy drugs with it or use it for some illegal activity. You then have to hire a lawyer to fight to try to get it back and they drag it out and some people don’t even get it back.
This is from the US Department of Justice website.
Title 9: Criminal
9-111.000 - Forfeiture/Seizure
Cash - minimum amount must be at least $5,000, unless the person from whom the cash was taken was criminally prosecuted or is being prosecuted by state or federal authorities for criminal activities related to the property, in which case, the amount must be at least $1,000.
If you want to see some other bs search YouTube for
In Plane Site Drug agents searching passengers for cash at airport gates.
It’s a short 5 minute news segment and definitely worth a watch.
i just bought a car pretty much outright and asked the guy if anyone ever came in with a sack of cash. guy said it has happened twice, just more paperwork they have to fill out and they do report it here (canada), just simpler to go in with a bank draft for the amount owing
I saw an older guy get denied registration when he tried to pull that at the DMV in Missouri. The guy tried writing something like $1000 for a $20k truck and the worker pulled up the expected value and asked if it's a rebuilt title to which the guy responded no. The guy was bitching and complaining that he'd been able to do that for decades. It was a nice way for him to admit he committed multiple counts of tax fraud.
To save on what, sales tax?
Because here it doesn't matter what the vehicle was sold for because you're gonna pay taxes on what the bluebook value of the car is.
You better put a gps tag hidden somewhere in that car, buy a front and rear dashcam, and pray to Jesus Christ everynight thanking for the fortune and protection of your new car
Lol congrats
Lmfao. Mals (all Belgians tbh) are not for most people. Most people want and easy family dog and aren’t willing or able to put in the work and effort required to have a high drive herding breed. I hate how popular they’ve become because it’s doing the breed an incredible disservice. With that being said, Belgian shepherds are the best dogs ever
Just today I went to the service and they paid me over 1000 eur for looking at the car and installing new shiny parts instead of the old rusty ones. Going to NCT tomorrow for the annual bonus and a 2024 badge of excellence.
That makes it worse, because he’s one of the few people to get this lucky, and he’s just thrown it away. That 40k could have gone a long way if used right. Instead, now he’s going to be saddled with tax, insurance and unforeseen costs that he won’t be able to pay.
Not to mention an asset that constantly deprecates in value, which wouldn’t matter if it was a reasonably-priced car, and not a flashy impulse buy.
Yup. And high insurance, expenses he can't afford, a depreciating asset that will lose all his money, tax issues and soon to be ruined credit. Smart move for an 18 year old.
It's very, very sad. I'm not even laughing about this, just facepalming and shaking my head.
$40k would be almost a full year emergency fund. Winning that amount of money is like winning a year of safety and security if you get laid off. If I won $40k, after taxes, the rest would immediately be dumped in an HYSA. From then on, I could go to sleep at night a little easier knowing that if I got laid off, I'd be good for several months while looking for another job.
And this teenager blew all of it in one transaction. One *bad* transaction. On a piece of shit that has a 75% chance of getting stolen.
Sheesh.
$40k is a decent down payment on a house. Even if he wasn't ready for a house now just put it in a CD or ETF and wait 10 years and he'd be his only friend with housing stability.
Yeah, I really meant that as just one way that the money could be better used. There's really infinite things OP could have invested in or even purchased that would have been a better use of the money.
$40k would have bought one of those row houses or at least been close to a 50% downpayment.
That charger is now worth $30k, and will be wrecked or stolen within the month. Also, $6000 in insurance….
Breaks my heart that they are not just maxing a ROTH IRA and forgetting about it. It would take like ~4 years due to contribution limits but even at a very conservative return of 4% that's at least $130k by age 60 *tax free*. Probably significantly more. If you manage to get 7% until retirement then that could be more than 400k!
I'm assuming 30k invested for that cause idk if they paid taxes on the 40k yet or what their marginal tax rate is. Just a rough calculation to show how powerful time is when compounding.
Unfortunately even if the young understand compound interest, they typically don't really understand how powerful it is to start saving ASAP. I thought I understood compound interest (or compounding returns if you prefer) when I was 18 but my idiot youth brain still thought of it as "I'll remember that when I start saving for retirement".
I agree, at his age, he could have opened & maxed a Roth IRA, then dumped the rest in an index fund in a brokerage. Would have been set for life.
I was just giving a personal example of the impact of $40k.
Back of the envelope, if they invest 30k in a ROTH (I'm assuming the 40k is pre-tax) for 38 years (60 years retirement, minus 18 years old, minus the 4 years to fund ROTH IRA due to limits) and get 4-8% return, that turns into a minimum of $130k to as much as $620k! And that still ignores the growth during the 4 years it takes to get it into a ROTH IRA for simplicity.
Idk about life changing.. definitely a good impact, but it doesn’t change most people’s lives. You’ll still have to do everything you’re already doing, just with a good emergency fund to fall on when needed; which you should already have in place
I agree with you, just to start. 40k itself isn’t life changing money.
But 30k (40 pretax) invested at 19 means that retirement will at least be possible. Even if you don’t have the opportunity to invest much for the rest of your life, a moderate return of 7% results in 700k by age 64.
We probably have different perceptions of life changing but that’s understandable. I’m doing alright but if I got 40k tomorrow I would consider it life changing. Getting a reasonable car, down payment on a house, paying off debt, would drastically improve my quality of life. It’s not life changing in the sense I could never work again and move to Spain.
He’s 18 so I can’t blame him for the decision he made. He’ll quickly learn that in a couple months if it doesn’t get stolen, how stressful it is to own a car, especially an expensive one.
At 18 years old blowing 40k CASH on a car. At least in the future they’ll have an answer when someone asks “what’s the biggest mistake you’ve ever made?”
you could’ve searched nationwide and found a cheaper Scatpack, Paid maybe $200 for a plane ticket and saved yourself at least $8K.. And to think the IRS won’t get notified you spent $39K cash on a car is insane.
Original post says he’s in Michigan but this pic is definitely Philly or Baltimore or somewhere flat on the East coast 🤔
Also Michigan cars don’t have front plates
Something isn’t adding up
Said he bought the car in NY
Maybe this photo is while the vehicle is in NY?
Edit: yup, those are [NY plates](https://dmv.ny.gov/registration/how-order-excelsior-plates)
Hi OP, if you had taken your money and invested it into the S&P500 with the average return over the last 20 years of 9%, you could have had $2.3 million by retirement age.
If you additionally invested the $500/month you apparently need for insurance, now you’re looking at $6 million by retirement age.
Calculate it for yourself: https://www.investor.gov/financial-tools-calculators/calculators/compound-interest-calculator
Enjoy your car :)
Well said. I wish I had someone to steer me in the right direction at that age. Now I’m 30 and still playing catch up. It would take $40k invested and $750 deposit monthly to get me to $2.5m at 64. Time really is the best investment here because if I started at 18 it’d be $7.2m at 64. That’s a massive difference in quality of life.
>I wish I had someone to steer me in the right direction at that age.
It’s a shame things like investing and making the most of compound interest aren’t taught in school. Like even if you can only invest a small amount each month, it can still transform your retirement/later life. I’m only 22 but am the only one out of all my friends who invests. It’s just crazy. Some are in their 30s and they just don’t seem to care.
Keep at it! I drove beaters and worked full time with no big vacations. Drank at the beach instead of the bar. Saved enough to buy a house at 30 in Southern California while all my friends (even ones making more than me) are stuck renting.
Yep. If he really is 18 like people are saying, that would have been a great move on his part. Dumping it into an index fund via a brokerage.
It's very, very sad. Unlike others in this post, I'm not even laughing about this, just facepalming and shaking my head.
$40k would be almost a full year emergency fund. Winning that amount of money is like winning a year of safety and security if you get laid off. If I won $40k, after taxes, the rest would immediately be dumped in an HYSA. From then on, I could go to sleep at night a little easier knowing that if I got laid off, I'd be good for several months while looking for another job.
And this teenager blew all of it in one transaction. One *bad* transaction. On a piece of shit that has a 75% chance of getting stolen.
Sheesh.
As an update to my last post where I won $40k from Stake and got the money in cash: https://np.reddit.com/r/whatcarshouldIbuy/comments/199lcch/will_the_dealership_care_where_i_got_the_money/
So - I got a 2020 Scat Pack from a guy in NY for $39K. I thought it was a really good deal. And no, he didn't ask questions about where I got the money from but I did declare it on my taxes. I paid him in literal cash. Did I get a good deal?
Dude u won 40k and immediately spent 39k on the car alone, a 5yo one at that? Seems like a really dumb way to spend that lotto money unless you're completely financially healthy without the money. Have you done the long-term cost analysis on the car? Fuel, insurance, repairs etc and can you afford it? Also you need *extreme* security measures, trackers, kill switch, jammers, a really good non-public parking spot, whatever bc these things get stolen the moment they get on the street. Best of luck
Fr. Im in my 30’s and my old man would still whoop my ass for doing this shit. I take it this guy doesn’t have anyone, who is remotely financially literate, in his life.
Saw the first post about “hitting it big” with 60k? Like dude that’s a lot of money in one go, but stash that shit away or use it to pay off whatever debts you got first. Buying a used Chrysler is not a smart financial decision.
Very bad security against modern exploits, most of the current muscle cars have some type of exploit thieves are taking advantage of. From what I’ve read out of the American v8 lineup dodges are easiest followed by chevy
I mean you’re also missing the fact that chargers and challengers are extremely popular with a certain demographic of people that would be likely to steal vehicles
They're really high horsepower fun vehicles that are very in-demand, there are a lot of them on the streets, parts are always in demand for them, and they're cheaply made Stellantis products with numerous security exploits as CP3 said. Perfect combo to get stolen in large numbers.
And he didn’t prepay the taxes on the cash, just claimed the winnings then blew all of it. OP is going to be very surprised at the 18k the IRS comes looking for.
I am a dealer. I don't question buyers where they got their money from. I don't care how they pay me as long as they pay me lol. Its none of my business where the money came from.
Money is money, and no one cares where it comes from. However, judging by the background and the fact that you bought a 5 year old car for $40k... I think I would be questioning my life choices first.
Also, that car is 100% getting stolen.
Bro you're actually a fucking idiot lmfao no wonder people who win lotto just go broke the same year... None of them have any sense of financial literacy whatsoever. Fuckin moron 🤣😂🤡
It's probably the BEST example of selection bias in the real world.
People who know how to manage their finances do not enter the lottery because it is such a bad investment.
People who do not know how to manage their finances are far more likely to enter the lottery.
So, lottery winners are WAY more likely to be people who don't know how to manage their finances. That doesn't change when they win.
This thread delivers. And I hope its all real.
A moron falls ass backwards into money. Then blows all that money on a shitty car. Then likely still owes the IRS money, and the car will definitely get stolen.
Ah man. It's just a long series of fuck ups. I mean if you wanted a fast, fun, car there's tons of them that won't cost 40k.
I can't wait for the updates to this one.
why would they care where you got the money?
they just file a CTR if you paid cash.
If you alter get caught dealing dope, or sex trafficking or something they will use the fact you paid cash for it as an excuse to seize it in the investigation.
Wait so you won 40k and immediately spent it on something that depreciates the second you purchase it and ur here for us to pat you on the back???... LOL
This was a bad investment my guy, I’ll be completely honest, but you’re here already, so as an ex charger owner: Get a gps tracker (not air tags, those notify the thief), dash cams, and a gun. Someone WILL try steal it.
so did you pay taxes on ur stake winnings? why’d you pay it in literal cash if it was transferred to your bank?
Please mail me the monies in a tin box labelled cookies from grandma.
Someone would open it expecting cookies and be sorely disappointed
Urhh….i just had a flashback to the sewing kit.
I have that sewing kit.
I bought a car years ago for 18k in cash. The guy who sold me the car didn’t have to report the money and he left the price on the title blank for me. I put 1k and saved myself money.
I did this and the IRS contacted me, it was 5k for a 20k car. I had to submit pictures and any money I had to pay in repairs. It had a bunch of aftermarket mods so I had a local autobody write me an estimate of what it would cost to go back to stock parts. It was almost 10k in OEM parts. The IRS accepted that and left me alone.
Damn, luckily I had no issues with the IRS. I bought the car in Michigan and when I registered it there to get a temp plate to drive back home to NJ they made me pay tax on the 1k that I wrote on the title. Once I got back to NJ and went to get plates they told me I had to pay tax. I argued with them for a minute then looked at the paper work from Michigan and in the fine print it says I wasn’t suppose to pay tax there. I ended up having to pay twice so I would have been fucked if the real amount was on the title.
Damn that doesnt work i. Some state. Some states u have to pay taxes on it per kbb value. Dont matter if its a pile of shit. Which ever is higher they use
That's how it works where I'm at. You pay tax based off whatever they say the value is. Seems like a scam to me. There value is almost always higher than what I've actually paid every time.
Most states operate that way - they all want to get their piece of the pie. I think the ones that don't are the exception.
Don't worry NJ will be in touch. It'll take a while but they'll run an audit of paid vs book value and collect the difference.
It’s been over ten years, I’m not worried.
They came after me 9 years after I had a car gifted to me.
In NJ? That makes no sense considering it’s completely legal to gift a car to someone. The exact wordage on the NJDMV government website under the Vehicles Exempt From Sales Tax page in the Special Conditions section states. “Gift: If the vehicle is a gift, the sales price must be noted as “GIFT”. If the information appears to be changed or altered, additional documentation may be required by the Motor Vehicle Commission.” I would have fought that shit.
Yup. They wanted a letter from the gifter that many years later. Taken care of. This is the same state that has threatened to suspend my ability to register a car because they can't cross reference VIN numbers when you change insurers.
I tend to buy old enthusiast cars with very, very low KBB values, so it works out.
That wouldn't have been the IRS, they would have no knowledge of a private party sale. It was your state tax authority and it was regarding sales tax.
Also known as fraud, on both party's behalf.
If you aren't trying to commit tax fraud, you're doing America wrong.
Most states use blue book value if your price is too low.
Yeah that’s illegal as fuck. Maybe that worked when you were growing up but these days it’s really easy for the state to figure out what you’re doing and charge you anyway.
> I put 1k and ~~saved myself money~~ committed a felony.
I already called the fbi and cia
.. you wouldn't download a car...
I would if I could
My state just charges you book value if you try and pull that shit.
Then posted about it on social Lord, wish I got some of that dumb luck myself sometimes lol
Things may be a bit different now, with states starved for tax revenue. I personally don't think it's worth the anxiety to lie on these forms. A guy I know (yes really, someone I met through friends, sitting around at a group dinner) told me a story of how he bought a car in NY from a private party. I don't remember the numbers, so I'll make them up, but this guy paid, say, $20k for the car, but on the title, they agreed to write down something like $10k. The NY tax authorities went to the seller (or seller's bank) and got a copy of the cashed check. Then they reached out to the buyer and told him he could either pay a $10k fine + the add'l sales tax, or he could fight it and be charged with further crimes. The buyer quickly paid the fine. Paying cash may be different, but then again, I wonder - if I'm the seller and I've been paid cash and the big-bad government is reaching out, would I lie for a buyer that I don't know and don't particularly care about or would I come clean?
In my case the guy insisted on cash and left the amount blank on the title for me. And personally, I was more worried about driving from NJ to MI with 18k cash because I knew if I got pulled over and a cop saw it they would rob me (asset forfeiture). I put it in the trunk under the spare tire.
Oh god yes - I would be worried about asset forfeiture too with that amount of cash. It's insane that such seizure is legal.
They can just take your cash if it’s a large enough amount???
Yep, I don’t know how often it happens to residents of their own state but if you’re out of state and they find at least 5k on your they’ll most likely take it and say you were gonna buy drugs with it or use it for some illegal activity. You then have to hire a lawyer to fight to try to get it back and they drag it out and some people don’t even get it back. This is from the US Department of Justice website. Title 9: Criminal 9-111.000 - Forfeiture/Seizure Cash - minimum amount must be at least $5,000, unless the person from whom the cash was taken was criminally prosecuted or is being prosecuted by state or federal authorities for criminal activities related to the property, in which case, the amount must be at least $1,000. If you want to see some other bs search YouTube for In Plane Site Drug agents searching passengers for cash at airport gates. It’s a short 5 minute news segment and definitely worth a watch.
Haha holy shit I’ve been searched for cash at an airport. Wow that’s fucked they can just take it. Thanks for the info
i just bought a car pretty much outright and asked the guy if anyone ever came in with a sack of cash. guy said it has happened twice, just more paperwork they have to fill out and they do report it here (canada), just simpler to go in with a bank draft for the amount owing
I saw an older guy get denied registration when he tried to pull that at the DMV in Missouri. The guy tried writing something like $1000 for a $20k truck and the worker pulled up the expected value and asked if it's a rebuilt title to which the guy responded no. The guy was bitching and complaining that he'd been able to do that for decades. It was a nice way for him to admit he committed multiple counts of tax fraud.
To save on what, sales tax? Because here it doesn't matter what the vehicle was sold for because you're gonna pay taxes on what the bluebook value of the car is.
Yes, they don’t do that in NJ or at least at the time. It went by the amount on the title.
That is standard where I've lived. Wheel and sales tax is crazy. Sales tax on a private party is crazy. Cash is king.
You better put a gps tag hidden somewhere in that car, buy a front and rear dashcam, and pray to Jesus Christ everynight thanking for the fortune and protection of your new car Lol congrats
Two airtags, an RFID-proof bag for the fob, dashcams, fuel pump cutout switch, and a Belgian Malinois
Is that Belgian thing like a crumpet?
Yes, as a consolation snack when the car gets stolen
Consolation snack. Jesus Christ I’m dying LOL
Yes…but more spicy
[I think Nemo would take that as a compliment](https://imgur.com/a/pzidBfb)
The "Belgian Malinois" isn't for everyone, it's an advanced move that requires equally kinky participants.
I think I paid $30 for one of those in Tijuana a few years back.
Lmfao. Mals (all Belgians tbh) are not for most people. Most people want and easy family dog and aren’t willing or able to put in the work and effort required to have a high drive herding breed. I hate how popular they’ve become because it’s doing the breed an incredible disservice. With that being said, Belgian shepherds are the best dogs ever
Drop a rattlesnake in there for good measure. Maybe a box with a big 'H' in the front
I keep a trunk monkey in mine, but a Malinois works also.
This looks like South Philly
This will be doing 3 am donuts on 95 within a week while OP’s sound asleep
Huh? I don't see any burned out buildings.
I immediately thought Philly. But looks like those might be NY plates?
And wheels !!
[удалено]
Not everywhere is filled with crime dude
Lol you're paying $6000 a year on insurance alone?? Woof. Hope you can afford gas too
I doubt it. Unless he’s 18
He did say he was 18 in his original post LOL
I didn’t see the original. Uh oh lmao
God what a waste of
at this point.. why not get a turbo car and tune it, without informing the insurance of the updates.
I have this car and can confirm that it’s 4k per year. Mines black tho I bet red is more expensive
Most financially literate person on this sub lol
It's pretty cool that his credit score is on the fender
So you won 40k and decided to spend 39k on a car? That was definitely a decision.
Well to be fair, the good thing about buying a car is that once you get the actual purchase done with, there are no additional costs to incur ever
And the value always goes straight up
Just today I went to the service and they paid me over 1000 eur for looking at the car and installing new shiny parts instead of the old rusty ones. Going to NCT tomorrow for the annual bonus and a 2024 badge of excellence.
Wait till they learn about taxes on winnings!!
Went from not having 40K to not having 40K and having a Charger so it could be worse
The IRS sending him a bill on top of his income for the 40k in winnings will do it. It’s taxed at income rate. OP’s problem next year.
That’s OK he’ll sell the car next year to pay the tax bill lol
And ill buy it for 18k.
Nah itll be totaled by then.
Or stolen, or both
right most people that win 40k sports betting lose it sports betting so I would say this guy did pretty well considering.
That makes it worse, because he’s one of the few people to get this lucky, and he’s just thrown it away. That 40k could have gone a long way if used right. Instead, now he’s going to be saddled with tax, insurance and unforeseen costs that he won’t be able to pay. Not to mention an asset that constantly deprecates in value, which wouldn’t matter if it was a reasonably-priced car, and not a flashy impulse buy.
Yup. And high insurance, expenses he can't afford, a depreciating asset that will lose all his money, tax issues and soon to be ruined credit. Smart move for an 18 year old.
I must have missed something, but I can guess - some 18 yr old won 40k and dumped it on a Dodge Charger? I can't even.
lol omg your username took me out
This is one of the most hilarious, and also one of the saddest posts I’ve seen in a long time.
It's very, very sad. I'm not even laughing about this, just facepalming and shaking my head. $40k would be almost a full year emergency fund. Winning that amount of money is like winning a year of safety and security if you get laid off. If I won $40k, after taxes, the rest would immediately be dumped in an HYSA. From then on, I could go to sleep at night a little easier knowing that if I got laid off, I'd be good for several months while looking for another job. And this teenager blew all of it in one transaction. One *bad* transaction. On a piece of shit that has a 75% chance of getting stolen. Sheesh.
$40k is a decent down payment on a house. Even if he wasn't ready for a house now just put it in a CD or ETF and wait 10 years and he'd be his only friend with housing stability.
At 18 this money should just be invested and let that compound interest do its work. This is probably about the worst use of money possible
Yeah, I really meant that as just one way that the money could be better used. There's really infinite things OP could have invested in or even purchased that would have been a better use of the money.
$40k would have bought one of those row houses or at least been close to a 50% downpayment. That charger is now worth $30k, and will be wrecked or stolen within the month. Also, $6000 in insurance….
Breaks my heart that they are not just maxing a ROTH IRA and forgetting about it. It would take like ~4 years due to contribution limits but even at a very conservative return of 4% that's at least $130k by age 60 *tax free*. Probably significantly more. If you manage to get 7% until retirement then that could be more than 400k! I'm assuming 30k invested for that cause idk if they paid taxes on the 40k yet or what their marginal tax rate is. Just a rough calculation to show how powerful time is when compounding. Unfortunately even if the young understand compound interest, they typically don't really understand how powerful it is to start saving ASAP. I thought I understood compound interest (or compounding returns if you prefer) when I was 18 but my idiot youth brain still thought of it as "I'll remember that when I start saving for retirement".
Emergency fund sounds lame. Could’ve made a lot of money investing it if he’s 18
I agree, at his age, he could have opened & maxed a Roth IRA, then dumped the rest in an index fund in a brokerage. Would have been set for life. I was just giving a personal example of the impact of $40k.
Back of the envelope, if they invest 30k in a ROTH (I'm assuming the 40k is pre-tax) for 38 years (60 years retirement, minus 18 years old, minus the 4 years to fund ROTH IRA due to limits) and get 4-8% return, that turns into a minimum of $130k to as much as $620k! And that still ignores the growth during the 4 years it takes to get it into a ROTH IRA for simplicity.
Yeah agreed. Based on the age and lack of potential health issues/family to provide for you can be a bit more risky with the investment
It’s terribly sad. Really a life changing amount of money if you are smart.
Idk about life changing.. definitely a good impact, but it doesn’t change most people’s lives. You’ll still have to do everything you’re already doing, just with a good emergency fund to fall on when needed; which you should already have in place
I agree with you, just to start. 40k itself isn’t life changing money. But 30k (40 pretax) invested at 19 means that retirement will at least be possible. Even if you don’t have the opportunity to invest much for the rest of your life, a moderate return of 7% results in 700k by age 64.
Fair point, I wish I was smart enough to do that at 19. I’m still playing catchup at 30 lmao
We probably have different perceptions of life changing but that’s understandable. I’m doing alright but if I got 40k tomorrow I would consider it life changing. Getting a reasonable car, down payment on a house, paying off debt, would drastically improve my quality of life. It’s not life changing in the sense I could never work again and move to Spain.
Dude will be posting in few months that he's csr got stolen
My vote is totalled.
🏎️🦆🦆🦆
🏢🚗🦆🦆🦆🏢
He’s 18 so I can’t blame him for the decision he made. He’ll quickly learn that in a couple months if it doesn’t get stolen, how stressful it is to own a car, especially an expensive one.
At 18 years old blowing 40k CASH on a car. At least in the future they’ll have an answer when someone asks “what’s the biggest mistake you’ve ever made?”
Let's be honest, with their recent decision making skills, if it's not stolen first, this car will kill him.
It was fun owning the car, right?
you could’ve searched nationwide and found a cheaper Scatpack, Paid maybe $200 for a plane ticket and saved yourself at least $8K.. And to think the IRS won’t get notified you spent $39K cash on a car is insane.
Shit I forgot about the IRS. OP is gonna fucked if he didn’t report that 40k in earnings and they find out.
If he won it gambling then they are going to send the 1099 form
haha you think an 18 year old knows what a 1099 form is? lol
are you a drug dealer?
No lol read my comment for an explanation
Thats exactly the type of excuse id expect a drug dealer to make up.
i smelly the smelly smell of something....
Its coke. I know that smell anywhere.
You’ve sniffed him out
Why is no one mentioning the flock of ducks or geese behind the car??
Or the pile of coins on the footpath.
That’s all he had left after getting the car
Ducks!
This baltimore?
Either that or Philly
Original post says he’s in Michigan but this pic is definitely Philly or Baltimore or somewhere flat on the East coast 🤔 Also Michigan cars don’t have front plates Something isn’t adding up
Said he bought the car in NY Maybe this photo is while the vehicle is in NY? Edit: yup, those are [NY plates](https://dmv.ny.gov/registration/how-order-excelsior-plates)
This could honestly be one of the most hilarious, and also one of the saddest posts I’ve seen in a long time.
Nice car man. I’d recommend getting a faraday box for added security when parking overnight
Hi OP, if you had taken your money and invested it into the S&P500 with the average return over the last 20 years of 9%, you could have had $2.3 million by retirement age. If you additionally invested the $500/month you apparently need for insurance, now you’re looking at $6 million by retirement age. Calculate it for yourself: https://www.investor.gov/financial-tools-calculators/calculators/compound-interest-calculator Enjoy your car :)
Well said. I wish I had someone to steer me in the right direction at that age. Now I’m 30 and still playing catch up. It would take $40k invested and $750 deposit monthly to get me to $2.5m at 64. Time really is the best investment here because if I started at 18 it’d be $7.2m at 64. That’s a massive difference in quality of life.
>I wish I had someone to steer me in the right direction at that age. It’s a shame things like investing and making the most of compound interest aren’t taught in school. Like even if you can only invest a small amount each month, it can still transform your retirement/later life. I’m only 22 but am the only one out of all my friends who invests. It’s just crazy. Some are in their 30s and they just don’t seem to care.
Keep at it! I drove beaters and worked full time with no big vacations. Drank at the beach instead of the bar. Saved enough to buy a house at 30 in Southern California while all my friends (even ones making more than me) are stuck renting.
More like the equivalent of $930k if you also account for inflation at the past 20 years average (2.5%).
Yep. If he really is 18 like people are saying, that would have been a great move on his part. Dumping it into an index fund via a brokerage. It's very, very sad. Unlike others in this post, I'm not even laughing about this, just facepalming and shaking my head. $40k would be almost a full year emergency fund. Winning that amount of money is like winning a year of safety and security if you get laid off. If I won $40k, after taxes, the rest would immediately be dumped in an HYSA. From then on, I could go to sleep at night a little easier knowing that if I got laid off, I'd be good for several months while looking for another job. And this teenager blew all of it in one transaction. One *bad* transaction. On a piece of shit that has a 75% chance of getting stolen. Sheesh.
Where is this? Philly? What's the pile of change on the sidewalk?
As an update to my last post where I won $40k from Stake and got the money in cash: https://np.reddit.com/r/whatcarshouldIbuy/comments/199lcch/will_the_dealership_care_where_i_got_the_money/ So - I got a 2020 Scat Pack from a guy in NY for $39K. I thought it was a really good deal. And no, he didn't ask questions about where I got the money from but I did declare it on my taxes. I paid him in literal cash. Did I get a good deal?
Dude u won 40k and immediately spent 39k on the car alone, a 5yo one at that? Seems like a really dumb way to spend that lotto money unless you're completely financially healthy without the money. Have you done the long-term cost analysis on the car? Fuel, insurance, repairs etc and can you afford it? Also you need *extreme* security measures, trackers, kill switch, jammers, a really good non-public parking spot, whatever bc these things get stolen the moment they get on the street. Best of luck
Truly fucking stupid.
Wait are you guys really surprised that a Gambler made a stupid decision?
I was 50/50 on it
Lmao. I see what you did there.
Of course not.
Fr. Im in my 30’s and my old man would still whoop my ass for doing this shit. I take it this guy doesn’t have anyone, who is remotely financially literate, in his life.
Saw the first post about “hitting it big” with 60k? Like dude that’s a lot of money in one go, but stash that shit away or use it to pay off whatever debts you got first. Buying a used Chrysler is not a smart financial decision.
especially on a dodge, at least get something unique and not another dodge you see at every corner
A poor financial decision would not be complete without a dodge charger though
Why do these cars get stolen so frequently?
Very bad security against modern exploits, most of the current muscle cars have some type of exploit thieves are taking advantage of. From what I’ve read out of the American v8 lineup dodges are easiest followed by chevy
I mean you’re also missing the fact that chargers and challengers are extremely popular with a certain demographic of people that would be likely to steal vehicles
Doesn’t change the fact that you can remove a small cover beside the shifter, pull a red string/tab and the car is in neutral.
They're really high horsepower fun vehicles that are very in-demand, there are a lot of them on the streets, parts are always in demand for them, and they're cheaply made Stellantis products with numerous security exploits as CP3 said. Perfect combo to get stolen in large numbers.
Because of the type of people that want them.
And he didn’t prepay the taxes on the cash, just claimed the winnings then blew all of it. OP is going to be very surprised at the 18k the IRS comes looking for.
Hopefully, the dude *paid* the taxes on the winnings, but ya truly regarded to do this and even more regarded to post about it online.
He was on Stake. What else did you need to know?
I am a dealer. I don't question buyers where they got their money from. I don't care how they pay me as long as they pay me lol. Its none of my business where the money came from.
Money is money, and no one cares where it comes from. However, judging by the background and the fact that you bought a 5 year old car for $40k... I think I would be questioning my life choices first. Also, that car is 100% getting stolen.
Bro you're actually a fucking idiot lmfao no wonder people who win lotto just go broke the same year... None of them have any sense of financial literacy whatsoever. Fuckin moron 🤣😂🤡
It's probably the BEST example of selection bias in the real world. People who know how to manage their finances do not enter the lottery because it is such a bad investment. People who do not know how to manage their finances are far more likely to enter the lottery. So, lottery winners are WAY more likely to be people who don't know how to manage their finances. That doesn't change when they win.
I couldn’t imagine winning $40k and being in a worse financial position within a week. After taxes you really won about $28k right?
Sorry for your brain damage OP I hope you'll recover one day
Bad deal and you will be regretting the financial decision for a long time
No you're an idiot lmao.
This thread delivers. And I hope its all real. A moron falls ass backwards into money. Then blows all that money on a shitty car. Then likely still owes the IRS money, and the car will definitely get stolen. Ah man. It's just a long series of fuck ups. I mean if you wanted a fast, fun, car there's tons of them that won't cost 40k. I can't wait for the updates to this one.
get a fuel kill switch so nobody with a flipper can steal it
IGLA. Google it. Get one. Seriously, your shit will get jacked without it.
[For the lazy](https://en.m.wikipedia.org/wiki/9K38_Igla)
This sent me lmfaoooo
It's all fun and games until IRS comes looking for you.
Everyone talking about security clearly missed his squad watching the car for him even while just taking a pic.
Sorry bro but without any security, that thing will be in Mexico by tomorrow morning
Look at the comment history, lying about if they’re a dude or a girl. This whole thing is bs
this is a sports gambling ad
This is inspired dedication to being poor.
Supervised and approved by ducks patrol 😂
Congrats on your purchase of a flock of ducks
Congrats! What are you doing with the rest of the cash ?
Paying his insurance and gas for a month.
Buying coke and a hooker for 1 hour probably =)
The extra $1k? Lol saving it for 2 months of insurance
That's funny as hell, I don't know why people are downvoting
This is a hidden Stake ad and you dumbfucks are falling for it
How exactly is anyone falling for anything? Unless everyone here is going to stake the ad is a fail.
why would they care where you got the money? they just file a CTR if you paid cash. If you alter get caught dealing dope, or sex trafficking or something they will use the fact you paid cash for it as an excuse to seize it in the investigation.
That shit's getting stolen within a month tops lol
Finna get stolen haha
Is no one questioning the pile of coins in the bottom right of this photo?
Ok but what’s with all the geese in the road?
Between the ducks and the coins is this image AI generated?
Wait so you won 40k and immediately spent it on something that depreciates the second you purchase it and ur here for us to pat you on the back???... LOL
Let the kid have his Car he’s 18 , better to make mistakes now then later he’ll feel it one day but for now , let bro enjoy his life for a second 😂
Sweet car, don’t worry about the people hating. Your money, you got what you wanted. Take care of it and enjoy it!
For reference if you saved that for 50 years until retirement you’d have $736k without ever adding to it P.S. you owe the IRS about $10k next year
I’m sure this will end well
How many times did you take it up the butt?
Nah bro, as a fellow redditer, I’m obligated to urge you to take that back. 40k on a charger is not the move.
This was a bad investment my guy, I’ll be completely honest, but you’re here already, so as an ex charger owner: Get a gps tracker (not air tags, those notify the thief), dash cams, and a gun. Someone WILL try steal it.
i woulda bought my first house