Re: “How is it financially viable to live out of Marriott hotel rooms for half a year?”

I’ve had a lot of positive feedback regarding my decision to become homeless for half a year and roam around the country. The general consensus is that people are happy I’m finally taking time to myself (as opposed to constantly grinding work), and many are keeping up with my travel blog posts and liv­ing vicariously through me.

There have been a few people, though, who think this is a terrible idea, and most of them believe this for financial reasons. I’ve had one person point out that I must be “filthy rich at this point that [I] don’t even know what to do with all my money,” while another has more bluntly stated that I’m a hyp­o­crite for pushing theories of financial responsibility and then proceeding to go do something as “reckless” as this.

I thought a great way to address this and explain just how it’s actually financially viable for me to do something like this is to do a breakdown of how much money I am and would be spending in each of the two living situations.

 
As a precursor to this, I want to point out that, no, I am not actually filthy rich. I am satisfied with the volume of my various income sources and I am much better off than an overwhelming majority of Americans, but I am in no way considered “rich.”

Also note that I am only 29 years old, and have a Bachelor’s degree and half of an incomplete Master’s degree. This means:

  1. I’ve only been in the workforce for a handful of years, not only because I’m still fairly young, but also because I spent a lot of years in school;
  2. I entered the workforce with an overwhelming amount of student loan debt, a lot of which had relatively high interest rates that I wanted to pay off as soon as possible; and
  3. I’m still busy saving up for retirement, as I want to get as much of that as possible taken care of now so I don’t have to worry about it later.

 
With that being said, let’s start with a breakdown of what my housing expenses would be had I stayed in Las Vegas. I was originally planning on moving to a studio in the Veer Towers, an all-residential high-rise condominium complex at CityCenter. The main reason I ended up not going this route is be­cause I had some lease agreement conflicts with the property management company and ended up walking away from the contract. But, for this ex­am­ple, we can pre­tend like this lease went through.

For the past year, real estate in Las Vegas has been absolutely insane—prices have been climbing faster than they’ve ever gone up before. Many rich Cal­i­fornians came into town as a result of work-from-home arrangements during the pandemic, and even though Las Vegas cost of living is still much cheap­er than California, it is nowhere near as cheap as it used to be when I moved to Las Vegas in 2018.

The list price for the studio I was looking at was US$1,600.00 per month in rent, which was reasonable relative to the going market rate. I was able to get a small discount off that price, down to $1,550. Note that there is extremely low inventory right now, so I consider that discount to be unreasonably luck­y, but I’m still using the discounted rate, seeing as I managed to secure it.

These luxury high-rises on the Strip all have homeowners’ associations, and the HOA dues paid by the owner/landlord cover most utilities. The only ad­di­tion­al expenses I would have on top of that would be ~$50/mo. in electricity and ~$100/mo. in Internet service.

Thus, my monthly housing expenses would total $1,700, which averages out to $56.67 per day.

 
Next, my Marriott hotel situation.

To begin, I want to clarify that Marriott is a massive brand. Marriott is the largest hospitality provider in the world; if you narrow it down to the United States, they’re the hotel chain with the second most locations, just behind Wyndham. With this many properties, there is quite a noticeable range of op­tions when you take a look at all their hotels.

When I say I’m staying at Marriotts across the country, I do not mean I’m staying at places like the Ritz-Carlton, St. Regis, or even the JW Marriott. In­stead, I’m staying almost entirely at brands like the Courtyard, Fairfield Inn, and Residence Inn. Marriott’s luxury hotels are designed to pamper you with amenities and give you a vacation experience you’ll never forget. Marriott’s “select” collection, as they call it, is designed to give you bare­bones lodg­ing at an affordable price that still meets the Marriott standard of quality, cleanliness, and safety.

Obviously, the nightly rate can vary substantially depending on where and when I’m staying. If I snag a spot with a promotion and/or an extended stay discount, I could get a room as low as $50 per night. On the other hand, if it’s the weekend and I’m passing through a tourist destination or just happen to be unlucky and am caught in the middle of a big event or convention, sometimes the cheapest I can get is $150 per night.

With all things being con­sid­ered, I would say that a fairly liberal estimate for an average cost of a night’s stay at a hotel is $75. If I scale that up to a 30-day month, the e­quiv­a­lent rate is $2,250. (Note that this is an all-inclusive rate that already includes taxes and fees, and obviously, there are no extra u­til­i­ty charges at a hotel.)

 
However, there are two extra things to account for here, the first being percentage-based rewards that functionally act as a discount.

Although you generally cannot pay rent with a credit card (or if you do, you incur an extra processing fee), it is commonplace and often highly en­cour­aged to pay for hotel stays with a credit card. I have a Chase Sapphire Reserve, a card geared specifically towards rewarding those who travel. The Sap­phire Reserve gives you 3 reward points for every $1 you spend on travel, and each reward point can be redeemed for 1.5¢ cash value using the new “Pay Yourself Back” promotion. Even outside of the promotion, you can still get a redemption rate of 1.5¢ per point if you redeem your rewards on even more travel. This functionally acts as a 4.5% discount.

I am also a member of Marriott Bonvoy, Marriott’s loyalty program. Through this program, you get reward points derived from how much you spend on Marriott hotel rooms and services (excluding taxes). For each stay, I get a base number of reward points, plus an additional percentage-based bonus due to my high loyalty tier qualification. This, again, can depend on where I stay and what tier of status I happen to be at the time of the stay, but overall, this can functionally translate to being about a 10% discount, as a conservative estimate.

Combining the two rewards programs, I get back a­bout 14.5% of the cost of the hotel room. Using the previous estimate of $75 per night, I get back a­bout $10.88 of value per night, resulting in an effective nightly rate of $64.12, or an effective monthly equivalent rate of $1,923.75.

 
But it doesn’t end there. The second thing to account for here is that I am not spending the entire seven months, from June 1 to December 31, in hotel rooms. If I’m traveling for work or staying with friends and family, I have to keep paying rent if I’m committed to a residential lease agreement, but for hotel rooms, I simply stop paying for hotel rooms during that period.

During the seven-month period, I will be spending a total of about a month and a half at Tempo‘s company headquarters, spread out in intervals of a week or two. I generally make a routine visit every month or two, and will continue to do so during my travels. While I am in Southern California, I will stay at the residential sector of our offices and will not need to pay for hotel rooms out-of-pocket.

I will also be spending a total of about a month and a half with my parents at their house in the Chicagoland suburbs where I grew up.

As for staying with other friends and family, although I anticipate spending about a month or so with “free” lodging, I will still be purchasing them gro­cer­ies, restaurant meals, and/or gifts throughout my stay in order to show my appreciation for them hosting me at their home, and I anticipate the cost of this to be comparable to staying at a hotel room. As such, I will not be deducting any expenses for staying with friends or non-parental family mem­bers.

If I account for the free lodging at my company headquarters and with my parents, I subtract three months of lodging expenses from the seven months of travel. That calculates out to each night costing 4/7th of its rate, which brings the $64.12 down to $36.64 per night.

 
We’re almost done, but there’s one more thing to factor in. I’m driving my personal pickup truck to each destination, and there is an additional cost to op­er­ate my vehicle beyond what I normally would just by staying put in Las Vegas. I’m not going to count the mileage of going out and getting food or going on tours, but I will count the mileage of going from city to city.

After mapping out my tentative road trip route, I think I am going to drive approximately 7,000 extra miles (11,265 kilometers) over the span of the sev­en months. According to the IRS standard mileage rate, it costs an average of 56¢ per mile to op­er­ate the average vehicle (which includes things like fuel, maintenance, and depreciation).

Although my pickup truck is a mid-size model with a tonneau cover for improved fuel economy and is more efficient than the average pickup truck, it is still slightly more costly than the average vehicle. On the other hand, the standard mileage rate includes stuff like insurance, which I would’ve had to pay for anyway. I’m going to consider those factors as balancing themselves out, and just stick with the standard mileage rate.

The cost to operate a vehicle 7,000 miles is approximately $3,920. Dividing that by 7, we get a monthly rate of $560. Divide that again, this time by 30, and we get a daily rate of $18.67. This needs to be added to the $36.64 nightly rate, bringing it up to $55.31.

 
And before we come to the final conclusion, I want to address two more miscellaneous points.

First is my food situation. Yes, I won’t be able to cook while I’m on the road… except I haven’t really been cooking much lately anyway. Ever since the pan­demic happened and I got a lot of relief funding from the government, I’ve been going out of my way to ensure I support local businesses and res­tau­rants. Ever since March 2020, I have been eating almost exclusively at family-owned local res­tau­rants (as opposed to going grocery shopping and cook­ing for myself). I will continue to do so during my travels, and the cost of that will be net-neutral relative to pre-travel.

Second is the time it will take me to get from city to city, and the opportunity cost associated with that time. I did not factor this into the calculation be­cause I feel like I am putting in my time and effort of driving in exchange for receiving amazing experiences visiting new cities across the country. On top of that, driving, to some extent, is therapeutic to me, so I don’t mind sitting in my truck for a few hours at a time just listening to music and ob­serv­ing the scenery.

 
So the final verdict.

Renting a place in Las Vegas and living a “normal” life would cost me ~$56.67 per day, $1,700.00 per month, or $11,900.00 for the full seven-month period. Traveling the country and being a nomad would cost me approximately $55.31 per day, $1,659.20 per month, or $11,615.00 for the full seven-month period. (The num­bers don’t line up perfectly to their fractional counterparts due to rounding and decimals.)

Yes, in my unique situation, I am literally saving a tiny bit of money by doing things the way I am.

If you truly thought I didn’t account for the financial implications and consequences of my decision, then you don’t know me very well.

 

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I sold all my meme stocks

A little over three months ago, I wrote a blog post that warned investors from going all-in on meme stocks, and I clarified that just because I enjoy talk­ing about meme stocks doesn’t mean all my holdings are in meme stocks. I also provided a table containing a fairly detailed breakdown of my in­vest­ment allocation to show that an overwhelming majority of my money is in “safe” in­vest­ments.

Since that time, both GameStop and AMC’s stock prices shot up again. With the volatility of meme stocks and the fact that it appears like retail investors might just cannibalizing themselves, I figured that making any profit at all off of meme stocks is better than losing money. I made the careful but prompt decision to exit meme stocks, and proceeded to sell all my shares in GameStop, AMC, Blackberry, and Nokia over the span of a hand­ful of days.

I made a profit of just over US$700.

Meme stocks were fun, and I was happy to be a part of the retail investor movement. But, being a resident of Las Vegas, I, more than anyone else, should know that it’s better to quit while you’re ahead.

(To be abundantly clear, and as a disclaimer, I am not a registered investment advisor and do not have the qualifications to become one. This blog post is intended to be strictly anecdotal, and I am in no way suggesting or implying that you should copy my strategy. Everyone’s situation is uniquely different, so be sure to consult with a certified professional if you have any questions or need any guidance.)

 
With that being said, here is a revised breakdown of my investment allocation:

Cash

I try to keep a minimal amount of my assets in cash because, not only do you lose value on cash from inflation, but it also serves as greater opportunity cost from potential growth. My cash holdings were fairly high last time simply because of the timing—I just hadn’t had a chance to take money in my settlement fund and move it into investments. This is down from 17.70% from last time.

 12.60%

Index funds – Domestic

My allocation in domestic index funds remains mostly the same. I can also provide a breakdown of subcategories within this category: I hold 35.82% in the total United States stock market, 38.35% in stocks geared specifically towards growth, and 25.83% in stocks geared specifically towards high dividend yields.

 36.10%

Index funds – International

My allocation in international index funds remains mostly the same.

  6.28%

Target retirement funds

This category got a slight increase in allocation because, since my previous breakdown, I contributed more money into my SEP-IRA after I finished filing my taxes and calculating my maximum contribution limits for the 2020 year.

 30.36%

Bonds

I let go of the “I might as well hold onto these bonds I purchased when I was young” mentality and just sold them all so I can use the money to invest into something that will result in higher returns.

  0.00%

Real estate investment trusts (REITs)

My allocation in REITs remains mostly the same. I recently did some further research into companies like Fundrise, but did not end up following through by investing.

  2.56%

Cryptocurrency

To be clear, this allocation isn’t higher because my investment grew… it’s because I dumped a ton more money into cryptocurrency, and then it plummeted, so now it looks as if I had just seen a modest return on my original investment. And yes, I got trolled just as hard by Elon Musk and Tesla as everyone else.

Within my cryptocurrency holdings, I own 63.38% Bitcoin and 36.62% Ethereum. I also own a tiny amount of some other blockchain as­set, but I don’t really have a mastery of how that works, and the valuation of it is negligible, so I’m not including it in my calculation here.

  4.81%

Speculative stocks

I scrambled up my speculative stocks a bit while I was in the process of selling off my meme stocks, but these holdings remain mostly with companies in the travel industry.

  0.84%

Meme stocks

No more meme stocks for me. … That is, until I randomly get the urge to gamble in the stock market again, I guess.

  0.00%

Private loans

This is a new category, and is a type of investment that I highly discourage you from doing. Since my previous breakdown, I have put a portion of my holdings into private loans, meaning, I am a lender to a private party.

Not only do you need the ability to screen your borrowers in an effective and comprehensive way to appropriately calculate risk, you also need to set aside emotion in your decision-making… which is difficult for most potential individual lenders, because the people asking you to loan them money are likely going to be people you know and to whom you have some sort of connection or attachment.

  6.45%

Maybe I’ll do a breakdown like this quarterly if my investment allocation changes enough? I’ll see.

 

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What other guides don’t tell you about finances for content creators and influencers

I’ve noticed that financial literacy has been on the rise exponentially in the past year. I imagine it is a combination of people studying finance on a need-to-know basis after hardship caused by the COVID-19 economic disaster, people being bored during the COVID-19 pandemic isolation period and want­ing to put their time to better use, and the ever-increasing accessibility of knowledge through the Internet.

 
I’m the Director of Operations of Tempo. We started out as an esports team and gaming strategy content website, but have since then expanded to be a gaming and interactive media production company and game development company. I joined back in 2015 when the company was a year old and have stuck with it—through all its ups and downs—for the past 6 years. As the head of corporate operations, I oversee and personally handle a lot of the com­pany’s legal, finance, and human resources matters.

As you’d expect from a role like that, I am one of two people in the entire company who have the security clearance to access any and all of our con­fi­dential and sensitive information. That gives me a unique insight into our employees’ and contractors’ lives and allows me to build a general profile of what the average esports player, content creator, and influencer is like from a financial sense.

 
This guide is not going to walk you through the fundamentals of being a content creator. I’m not going to tell you when you can quit your day job, or describe how you can best monetize your Twitch stream, or explain how to file your taxes as someone with no W-2 income. If you don’t know how to even get started being a sole proprietor, or if you don’t even know what that means, then you need to take care of that first.

Instead, this guide is going to point out some basic things about finances that I often never see covered in other guides. Maybe it’s because these are a bit more obscure, or maybe it’s because relaying this kind of information to someone may be perceived as brutal. Either way, I think this is information that you need to know to improve your baseline financial competency as a content creator or other kind of online influencer.

As a disclaimer, I live in the United States, and a lot of this advice is geared specifically for residents of the United States. Additionally, I am not an in­vest­ment advisor, certified accountant, financial advisor, or real estate agent… and even if I was, I wouldn’t be your advisor, accountant, or agent. To you, I am nothing more than a guy on the Internet writing blog posts on his personal website. If any of this information sounds helpful to you, make sure you consult with a real professional to see how this may apply to your unique, individual situation.

 

  1. You probably won’t have this job forever.

    You need to worry about your job security far more than normal people. If a “normie” loses their job, they can submit their résumé to a similar, comparable company and probably get hired somewhere else (unless they did something incredibly stupid and got involuntarily terminated due to their conduct). You, on the other hand, can’t really do that. How many companies do you think would want to hire you when your entire pro­fessional experience involves playing video games all day and talking to a camera?

    A lot can change in the content creation and entertainment industry. There might be some sort of accident that affects your face, and people stop watching your content because they no longer find you attractive. That sounds terrible, but you very well know that that’s definitely a possibility. Maybe, due to the stress and pressure of being a content creator, you start overeating and become overweight, and then people stop watching your content because they, again, no longer find you attractive.

    Even on a less personal level, trends change. What if you’re a video game streamer, but the video game (or maybe even the entire genre) that you’re good at becomes not as popular anymore? There are many examples of extremely popular StarCraft II players who just don’t pull viewership num­bers anymore because people don’t really play much StarCraft anymore. Or, what if your target audience gets older and consumes less content, while you fail to make a personal connection with the new younger generation?

    What if you randomly get canceled for something you didn’t do? What if someone just doesn’t like you or is jealous of your success, and decides to make up a story that turns your entire community against you? It’s considered taboo to ask questions or not believe the victim. Sure, you can file a defamation lawsuit, but what about your income source right now?

    Never take a single day as a content creator for granted. Save your money like your life depends on it, because it does. Take this especially to heart if you don’t have an academic background or degree beyond secondary school that you can fall back on if your content creation career goes awry.

    Treating yourself to something that makes you happy once in a while is very important, but I do not recommend splurging on anything big until you have five (yes, five) years’ worth of basic expenses saved up. This should obviously be assessed on a case-by-case basis, and the savings buffer can be reduced depending on your non-influencer qualifications, but the 3-6 months of expenses that normies save up for is not enough for you. Five years’ worth of expenses will cover things while you get back on your feet, enroll in a vocational or trade school, and build a up a new career.
     

  2. Invest in your own safety and security.

    As a public figure, there is a large target on your forehead. No matter how wholesome and well-liked you might be, there will still be people out there who dislike you. Most people take out their anger by sending you mean messages on social media, but there are people out there who are men­tal­ly unstable and will take things too far. If you are unlucky, you end up becoming a victim of one of these people.

    One of the best ways to invest your money is to spend a little bit more to make sure you are safe and secure in your home.

    It might feel good saving a ton of money by living in a regular house in a regular neighborhood with a bunch of other people, but that leaves you out in the open. It is fairly easy to find people’s addresses nowadays. For example, did you know that, if you are registered to vote and didn’t fill out a special form to tell your local government not to release your information, your address and party affiliation becomes public record? If you live in a regular house, someone can literally drive up to your home and threaten you in-person.

    Ever since moving out of my parents’ house, I have never lived in a publicly-accessible location. I’ve only lived in high-density apartments and condominium complexes that have 24/7 security. At the condo that I recently moved out of, you would need a credential to even drive into the building property at all, then you need a key fob to get into the building, a key fob to be able to use the elevator, then a physical key to unlock your door and bolt lock to your own unit. Does this absolutely guarantee that a predator won’t show up at my door? No, but it sure makes it borderline impossibly difficult.

    You are your own most valuable asset. If you have the funds available to upgrade your living situation, don’t underestimate the value of security guards and restricted-access building lobbies that stand between your door and the street. (On a related note, don’t fall for the false sense of security that an unattended “gated community” might give you—those are functionally useless, as people can climb over the gate, and the access code is often given away by your neighbors to delivery drivers.)
     

  3. Set up a wishlist of personal items you need or want.

    A lot of content creators and influencers have Amazon wish lists or other gift registries, but people tend to make two distinct mistakes. First, some people… don’t actually have wish lists. Second, some people put exclusively business items on their wish list but leave out all their personal items.

    It is in your best interest to buy business expenses with your own pre-tax income so you can write them off as deductions, and be gifted personal items from others so you end up saving as much of your post-tax income as possible. The magical element here is that you do not have to report your gifts as income (because they are gifts); taxes on gifts are (usually) paid by the giver, not the receiver.

    Imagine that there is something worth $70 that you have to buy for business. All you need to do to earn this purchase is to make $70 and buy the business item. Now imagine that there is something worth $70 that you have to buy for personal reasons. In order to afford this $70, you have to make about $100 in actual income, pay $30 in income taxes (this is just an example, and your tax bracket may be different), and then use the leftover $70 to buy your personal item. Consequently, if someone wants to give you money to buy this $70 personal product, it’s in their best interest to just straight-up buy and give you the $70 product, as opposed to giving you $70 in cash so you can buy it yourself—because, after taxes, $70 in cash won’t be enough anymore.

    There’s nothing wrong with putting high-value business expenses on your wish list, especially if you have a few whales who love to spend a ton of money on you. However, keep in mind that, if you still have personal expenses left that you need to account for, it’s not optimal for someone to buy you business products in lieu of personal products, if the value of both products are identical.
     

  4. Take full advantage of all your tax-advantaged retirement accounts.

    Most people are aware of IRAs now and have started a Roth or Traditional IRA with their favorite brokerage or provider. If you’re going for a long-term savings plan, it is very important that you max out this account every single year before you put your money in any other kind of savings plat­form. For example, if you have an individual brokerage account and an IRA, and your investment objective is long-term growth, and you put mon­ey in your individual brokerage account prior to maxing out your IRA’s yearly contribution, you’re doing it wrong.

    (As a disclaimer, note that I said you should always be maxing out your IRA if you have a long-term savings plan. Early withdrawals from IRAs come with penalties, so if you need investments with the utmost liquidity for an upcoming big purchase, then putting that income in tax-advantaged retirement accounts may not be the best course of action. If you are unsure how to proceed, consult with your own tax professional prior to committing to any investments.)

    But let’s say that you’ve already put in the maximum allotted amount into your Roth IRA this year, but you still have some leftover funds that you want to invest for long-term growth. Then you would put that money into your individual brokerage account, right? … Well, no.

    As a sole proprietor, you have access to more tax-advantaged retirement savings options. Before you start buying index funds on your regular brokerage account, do some research and look into SEP-IRAs, i401(k)s, and SIMPLE IRAs. These are all special retirement programs for business owners (and all content creators and influencers who make Form 1099-NEC income count as business owners, even if you might be your own employee), and they may carve a fairly large chunk away from your tax liability.

    For example, I have a SEP-IRA with Vanguard. Each year, I can contribute several thousand dollars into this SEP-IRA, depending on how much taxable income I made that year—and this is on top of the $6,000 I put in my Roth IRA. These several thousand dollars in my SEP-IRA are tax-deductible, which means it’s as if I had never made this income to begin with. Within this SEP-IRA, I am able to invest my money as if it was a normal brokerage account. Seeing as my objective is long-term growth, I usually buy growth-oriented Admiral Shares, a special type of index fund by Vanguard.
     

  5. Be cautious of aggressive Schedule C deductions if you’re planning on getting a traditional mortgage soon.

    The real estate market has been absolutely insane lately, and you might be someone who wants to get in on the hype. Warnings of emotional in­vesting aside, if you do truly want to purchase a house, chances are, you’ll need to borrow some money from a lender and get a mortgage.

    This process is fairly straightforward for normies because they’re on a set sal­a­ry. The lender will contact their employer, check on their job se­cu­ri­ty, verify their employment, and base their approval amount on their sal­a­ry. However, independent contractors generally don’t have set sal­a­ries—you never know how much advertising revenue or sponsorships or tips/donations you’re going to get each month—so lending to an independent contractor is inherently higher-risk.

    The way banks calculate how much they lend to an independent contractor is to look at your Schedule C in your yearly Form 1040 filing to the IRS. From there, they look at your net income (not gross income), re-add business expenses for home office use and depreciation, and subtract the remaining 50% of your meals deduction to find your overall yearly income. They look at the previous two years of tax returns for this; if your in­come has increased year-over-year, they take the average of the two, and if your income has decreased, they use the lower value.

    If you’re intuitive, you may see where this is going. If you take a lot of business expense deductions, your net income is going to decrease, and your mortgage amount is going to decrease as well. This is because lenders are using the information on your Schedule C while honoring the true spirit of the concept of “business deductions,” in the sense that, the only reason you were able to make that amount of gross income is because you had to spend your own money too. Thus, they don’t see deductions as ever having been your money, but rather, a resource you needed to use to make your income.

    For people with squeaky clean Schedule Cs, this might not be a problem. However, if you smudge your deductions a bit or walk within the gray area, it may seem counterintuitive to have a lower mortgage approval amount, even though you’re keeping more money by giving less of it to the gov­ern­ment in taxes.

    I personally faced this problem for years, and this is the conclusion I came to: If you’re rich enough that you’re willing to pay income taxes on your money, then the lender can feel comfortable taking that money into consideration when determining how much you can borrow. If you’re taking a ton of deductions, the bank has no concrete way to prove that you’re not just scraping by and taking those deductions because you have to, so it’s in their best interest to not take the risk and just disregard that from being eligible income.

    And yes, there is yet another side to this—independent contractors can just elect not to take deductions (because you are not required by law to take deductions), thus artificially inflating how much money it appears like they’re making. Banks would then base their lending decision on this information, you end up wasting more money on taxes, you get a bigger mortgage, and you increase your chances of not being able to make pay­ments and defaulting on the loan.

    This is obviously a fairly involved process, and I have no be-all-end-all advice for you apart from doing research on this and calculating a good bal­anced situation for yourself for your taxes. The point here is, don’t be caught off guard that this system exists in this manner, and educate your­self about how mortgages work (and possibly some alternative lending solutions) at least two years before you plan on purchasing a house.
     

As you’d imagine, this only scratches the surface of finances for sole proprietors. I’d classify most of this as basic information, or low-intermediate at best—and this is why a lot of people off-load their finances to a certified accountant.

I mentioned this at the top of this blog post, but to reiterate, if any of this seems useful to you, make sure you do your own research and reach out to your own advisors and professionals to figure out how this may apply to your unique, individual situation.

 

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My non-registered, non-certified investment advice for you

As is hopefully clear by the title, I want to point out that I am not a registered investment advisor and do not have the qualifications to become one. This anecdote outlines my personal experiences only, and is not to be used as guidance to manage your assets in lieu of a certified professional.

With that being said, my advice to you is actually very similar to the disclaimer above, and it is: Do not trick yourself into making unjustifiable in­vest­ment decisions based on others’ experiences if you are not fully informed of the entire situation.

 
The reason I’m writing this blog post is because I’ve been chatting quite a bit lately with my friends about investments. Most have listened to my ex­pe­ri­ences and intelligently used them as learning opportunities to do their own research about the related topics, but a few others… have made some ques­tion­able decisions.

It’s fun to talk about the wild and unexpected nature of the stock market, and it can be thrilling to share stories of huge successes or massive failures. What isn’t fun is talking about the steady growth of reliable index funds. Thus, if you were to ever ask me about my investments, I will probably talk about meme stocks, because talking about meme stocks makes for an inherently more interesting conversation.

A very important thing to remember is that the ratio of topics in a conversation does not necessarily correlate with the ratio of my actual investment dis­tri­bution. That means, if I spend 95% of my time talking with you about meme stocks and the remaining 5% about index funds, that does not mean I own 95% meme stocks and 5% index funds.

If you misinterpret that and assume I have 95% meme stocks, then proceed to align your own portfolio to have 95% meme stocks, then you have prob­ably made an incredibly stupid decision. That isn’t to say that you won’t see success—if you’re lucky, you could become a millionaire overnight, and I never said that there can’t be stupid millionaires—but you have just as likely of a chance of losing almost everything.

 
I always keep that last point in mind—that you have a chance of losing almost everything. That’s why the amount I invest in meme stocks and other extremely high-risk securities is limited only to the amount that I am comfortable losing. I am not comfortable losing my entire portfolio, so I choose to put a vast majority of it in things that I know will not suddenly vanish overnight.

I have a simple way to visualize this. Here is a table of the diversity of my portfolio.

Cash

This includes money in my online savings account and a tiny amount in my checking account, as well as money market settlement funds for money that has been transferred to my brokerage in preparation for investment that I haven’t had an opportunity to use yet.

 17.70%

Index funds – Domestic

This includes a variety of United States index funds ranging anywhere from the general S&P 500, to funds specifically targeting objec­tives like growth and dividends, covering across a variety of small- to large-capitalization companies.

 37.19%

Index funds – International

This provides me with exposure to the international stock market, including both developed and emerging international economies.

  6.96%

Target retirement funds

I use Vanguard to manage my tax-advantaged retirement accounts. Within my Roth IRA and SEP-IRA, I keep my money in the target retirement funds VFFVX and VTTSX, which are funds managed by Vanguard with dynamic composition so it prioritizes rapid growth during youth and stability closer to retirement. These target retirement funds have a mixture of domestic and international index funds, as well as some bonds later as retirement years approach, which is why I itemized this out separately.

 27.59%

Bonds

When I was a much younger investor, I was far less tolerant of risk for two main reasons: (1) I overestimated the risk and volatility of index funds, which was caused by my inexperience with investing, and (2) I had low net worth so I had more of an incentive to pro­tect what I had. I bought some bonds back then, but haven’t added to my bond balance since; I figured I might as well keep the bonds I already purchased, seeing as it’s a very small portion of my portfolio.

  2.35%

Real estate investment trusts (REITs)

REITs are a way for you to diversify your portfolio to gain exposure to real estate without having to go out and purchase a property. I am definitely interested in purchasing actual real estate sometime in the future, but until then, I decided to invest a small amount into REITs.

  2.59%

Cryptocurrency

I’ve researched and experimented with cryptocurrency for a while, but for now, I’ve settled on owning some Bitcoin and Ethereum.

  4.20%

Speculative stocks

These are individual stocks that I purchase directly through a brokerage, rather than stocks that are included in index funds or ETFs. As of right now, a majority of my speculative selections have been in travel companies, but these are stocks that I actively trade depending on where I think the market is headed. I do this primarily for fun, with capital growth only being a secondary objective.

  1.03%

Meme stocks

Just so I can say I was a part of the retail investor movement, I own shares in GameStop (GME), AMC Entertainment (AMC), Blackberry (BB), and other strange securities as recommended by the Reddit community Wall Street Bets.

  0.37%

If you loosely categorize my investments, you can say that I have 94.39% in “safe” holdings and 5.61% in “dangerous” holdings.

 
Let’s assume that disaster strikes. Bitcoin crashes and falls from $58,000 to just $4,000 like it was throughout a lot of early 2019, losing 93%+ of its value. Ethereum faces a similarly proportional crash. COVID-19 mutates into COVID-9001 and locks down the entire planet again, causing travel companies’ stocks to plummet to only 20% of their current value. And of course, GameStop, AMC, and Blackberry all go entirely bankrupt. In this theoretical sce­nar­io, I lose 5.11% of my portfolio.

Not ideal, but I’m ok with that.

An even greater mitigating factor is that this loss is based on the current value of my portfolio. If you’re familiar with cryptocurrency, you know how fast it’s risen in value. If you calculate my losses relative to cost basis rather than current value, then the percentage of money I would lose is even less.

 
So if you’re ever interested in buying Bitcoin or shares of GameStop because of me or someone else talking excitedly about the topic, and you want to “copy” us because we seem to sound like knowledgeable investors, keep the table above in mind. Don’t let our excitement falsely trick you into thinking that we’ve gone all-in on meme stocks.

To be clear, this is not me telling you whether you should or should not go all-in on meme stocks; this is me making sure you know that I absolutely did not.

 

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Re: “What would be your version of GQ Sports’ ‘My First Million’?”

GQ Sports has been doing a YouTube series called “My First Million” where they invite professional athletes to share how they spent their first million dollars that they earned in their respective sports leagues—the most recent episode was released earlier today and featured Will Hernandez from the New York Giants.

Now obviously, even with financial advisors, sports stars aren’t exactly known for being wise spenders. On the other hand, it’s almost become a meme at this point as to how neurotically I personally manage my own money. As a result, I’ve had a few people reach out to me and ask me to do my own ver­sion of “My First Million” as if I was also a superstar who had just made my first million dollars.

Those who truly know me know that my answer is actually astonishingly simple—I would save and invest all of it. But that would make for a very boring “My First Million” breakdown, so I’m adding in a few stipulations:

  • I have to use all the money. Saving is acceptable if it is savings with a specific purpose, but I cannot just throw it in a general savings account or investment portfolio and leave it alone.
  • I have to spend all of it on myself. This rule is actually mostly to protect myself from people who may see this hypothetical blog post and ask why I would spend money on this person but not on them.

With that being said, I can come to a few initial conclusions:

  • There is no indication as to whether this is my first and only million, or my first million of many, so I will take the safer route and assume this is the only money I’m getting. This is generally a better approach for superstars to take anyway, because you never know when their careers may end.
  • Because this is a high-profile sports contract, I believe I can safely assume that this income can be classified as employee salary, not independent contractor miscellaneous earnings. Thus, I am only responsible for my own half of FICA tax (i.e., no self-employment tax), and I am unable to take any operating expense deductions from my income tax.
  • I already own a lot of stuff that I want, so a majority of these purchases will upgrades of what I already have, or luxuries that I don’t actually need but would be nice to have.

So, here is how I would spend my US$1,000,000.00:

Federal income and FICA taxes

With an income of a million dollars, I should expect to spend about $330,000 in federal income tax, as well as an additional $30,000 or so in Federal Insurance Contributions Act (FICA) tax (which covers Social Security and Medicare). I have no state income tax because I am a resident of Nevada.

$ 360,000.00

IRA & i401(k)

In the spirit of “pay yourself first,” and for the sake of my future, the next thing I would spend on is my retirement. I have an individual retirement account (IRA) and an individual 401(k) account; IRAs accept a maximum yearly contribution of $6,000, while i401(k)s accept up to $56,000.

As a side note, I know I stated above that this would not be self-employment income, but I already file my taxes as a sole pro­prietor from running my own business and my i401(k) already exists, and there’s nothing I’m aware of at the moment that would stop me from using employee income to contribute to an i401(k), as that kind of restriction wouldn’t seem log­i­cally sound.

$  62,000.00

2-bedroom unit in a high-rise condominium on the Las Vegas Strip

I actually had to think a bit on this one. I know for a fact that I’d like to stay in Las Vegas forever if I’m able to, so I can definitely commit to purchasing a property, but I wasn’t sure what type of property I wanted. I really enjoy the lifestyle of living in a high-rise condo, but I also appreciate the privacy and comfort that a single-family house can bring.

I ultimately decided to go with living in a high-rise. There are some very high-value units available in high-security, all-residential buildings like the Allure, Panorama Towers, and the Martin, and with housing prices already visibly falling in Las Vegas as a consequence of COVID-19, I think I can get a great property for a low price.

Now of course, this doesn’t mean I won’t have any more housing expenses and I can quit my day job. High-rise con­do­min­i­ums on the Strip have sizable homeowners’ association fees, and along with home insurance and property taxes, my monthly expenses will probably still be somewhat close to what I’m paying in rent right now.

$ 450,000.00

Tempur-Pedic TEMPUR-breeze° king-size mattress

I’m sure you’ve all heard of how you spend a third of your life in bed, so you shouldn’t skimp on your mattress. I completely agree with that, so much so that I decided to actually itemize out my mattress and get the best one I could find that wasn’t completely unreasonable in price. I’m no mattress expert, but Tempur-Pedic seems to have a great reputation for great mat­tresses, so I decided to go with one made by them.

I don’t think I had this problem when I was a younger child, but as I grew older, I’ve developed a strange back pain problem. I’ve tried quite literally 5 or so different mattresses of different brands, firmness, and construction, but none of them seem to be the perfect mattress. In fact, I actually sleep pain-free for the first few nights on a new or different mattress, then my back pain returns shortly afterwards.

My current mattress is a little over $1,000, and I imagine that just buying increasingly expensive mattresses isn’t going to magically fix my back pain problem, but with the great reviews that Tempur-Pedic has, I figured it was worth a shot. My current mattress isn’t bad, though—I’d just use it in the second bedroom of my new condo.

$   5,000.00

Furnishings

I actually own an incredibly low amount of furniture. Since moving from the Chicagoland suburbs to the Pacific Coast, I’ve always minimized my possessions because I moved a ton within Southern California and Las Vegas. But now that I’ve just bought a property, I imagine I can safely assume I won’t be moving again anytime soon, so I can start buying some furniture.

When I get something done, I want it done in the best way possible, so if I’m going to buy furniture, I want it to be furniture that I love. I have a mild obsession over ultra-modern design, so I would actually want everything to be in white leather and glass.

Of course, that’s going to be far more expensive than a boring brown fabric couch, so I’m allocating about $40,000 for the cause. Combined with the little furniture that I do already own, that should probably be enough to fully furnish the two bedrooms, living area, and kitchen.

$  40,000.00

Ram 1500 Rebel

Now here’s where the fun begins.

You may already know that my “dream car” is actually a pickup truck, and it’s the Ram 1500 Rebel. The only reason I don’t actually have one already is because I’m concerned about Fiat Chrysler’s historically catastrophic reliability—I don’t want my truck to randomly break down in the middle of nowhere, and I don’t have the time and money to constantly have my truck in the shop. But, seeing as I’m outright buying this vehicle (and paired with the fact that I just made a million dollars), I’m sure I can afford to get a Ram and pay the extra maintenance costs when the truck inevitably breaks down.

The particular configuration I want MSRPs at just over $60,000, but I’m sure I can get some incentives and dealer discounts to bring that price down. I threw in an extra $10,000 in modifications, like ceramic window tinting, matte black vinyl wrap, metallic gold accents, a conservative lift kit, and meatier tires. I’d just need one vehicle as my daily driver, so I’d trade in my current truck, which knocks about $25,000 off the price.

$  45,000.00

Glock 43

I am a strong believer that you should only buy things if they serve a purpose in your life, so if I already have something, I usually won’t buy “duplicates” unless I have a really good reason to. I don’t think buying another gun is necessary, but I think having a million dollars to spend is a pretty good reason to buy another gun.

Glock 43s are subcompact pistols that are generally used by concealed carriers who want to hide the fact that they have a firearm. The firearm itself goes for around $550, but with modifications, the price can climb pretty quickly. I threw in an extra $450 on the price to account for things like a slide cut, Cerakoting, and custom-colored hardware.

$   1,000.00

Exotic leather goods

I’m a big fan of exotic leather goods, with a particular interest in stingray skin. I have a stingray wallet, stingray rowstone belt, and hornback saltwater crocodile belt, among others.

I’m not 100% certain what exactly I would want yet, but I would allocate $2,000 into buying more exotic leather goods. If you find a good private leatherworker instead of going for designer brand names, you can get pieces made at a very af­ford­a­ble price, so this budget should be enough to get me two high-quality pieces. One of them might end up being another stingray belt in a different pattern, possibly dyed a different color, with a sterling silver buckle.

$   2,000.00

Naming rights to a room in the Las Vegas Metropolitan Police Department’s new Reality-Based Training Center

Yes, this is technically just a charitable donation to the Las Vegas Metropolitan Police Department Foundation, but seeing as I made a stipulation that I had to spend the money on myself, I found a little loophole. LVMPD is in the process of con­structing a new training facility, and donors are able to purchase naming rights to different rooms in the building. Thus, this is my way of “buying myself something”—but also contributing to a good cause in the process.

I also know that some of you who know my past history have been wondering this entire time how I’m going to figure out a way to give some of this money to a law enforcement charity… so here it is.

$  10,000.00

Day-to-day miscellaneous expenses

And finally, I’d save $25,000 of the million to cover day-to-day expenses. This covers stuff like food, self-care, health in­sur­ance, and pretty much anything else that may come up in my everyday life. I mostly keep my daily expenses slim, and seeing as I just spent $543,000 enhancing my life and another $62,000 to put into savings, I’d imagine that an extra $25,000 would be sufficient to account for everything else.

$  25,000.00

 

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How much value I got from my Chase Sapphire Reserve in the first year

Most people are hesitant to sign up for credit cards with annual fees because they never know if it will be worth it. Back in July 2018, I signed up for the Chase Sapphire Reserve because, after a quick calculation, I knew for a fact that I would get way more value out of it than a regular, no-annual-fee credit card.

Now that one year has passed, I decided to do a deep dive on all the spending I’ve done on my Chase Sapphire Reserve to see just how much value I got out of it.

Before we begin, I want to separate this benefit from everything else: I received 50,000 rewards points as a sign-up bonus, which is equivalent to $750 worth of travel redeemed through the rewards portal. All monetary value calculations of points will be done at the 1.5¢ per point rate, as I actually use all my points to their fullest extent (then usually still run out of points and end up buying more travel out-of-pocket).

According to my account’s spending report, here is what I bought between August 2018 and July 2019 (I don’t think all these categories are accurate; I’m just going off what Chase thinks each purchase is):

Category Spending Rewards
Automotive $ 324.72 $ 4.87
Bills & utilities $ 7,272.35 $ 109.09
Entertainment $ 386.00 $ 5.79
Food & drink $ 4,025.55 $ 181.15
Gas $ 1,664.72 $ 60.38
Groceries $ 2,061.33 $ 30.92
Health & wellness $ 2,240.28 $ 33.60
Home $ 1,759.77 $ 26.40
Personal $ 445.01 $ 6.68
Professional services $ 2,955.82 $ 44.34
Shopping $ 6,715.17 $ 100.73
Travel $ 4,678.49 $ 210.53
Total $ 34,529.21 $ 814.47

With that being said, here are the key points:

  • The annual fee is $450, but the card comes with a $300 travel credit that I am guaranteed to redeem each year, so the effective annual fee is actually $150.
  • If I had spent $34,529.21 on a 1% cash back credit card, I would’ve earned $345.29 in rewards. By using the Chase Sapphire Reserve instead, I accrued $814.47 in rewards points during the year. That is $469.18 more than if I had stuck with a regular credit card.
  • I am enrolled in Global Entry, but I enrolled one year prior to getting a Chase Sapphire Reserve, so I haven’t used the card’s Global Entry credit yet. However, over the span of the five-year renewal period, this benefit is equivalent to a value of $20 per year.
  • In regards to Priority Pass Select, my travel tendencies tend to fluctuate a lot, but if taking a very rough average, I travel about once a month and often enter an airport lounge 2 times per trip, for 24 visits per year. The cheapest way to enter an airport lounge this frequently is through Priority Pass Prestige, which is $429 per year. Now of course, if I didn’t have Priority Pass Select with the Chase Sapphire Reserve, I just wouldn’t use airport lounges, so the weight put on this benefit is different than the raw monetary value of other benefits. However, I do get free food in lounges, and if I were to assign a conservative value of $5 worth of food eaten per lounge visit that I otherwise would’ve had to buy elsewhere, the benefit is worth about $120.
  • The card comes with various elements of travel insurance, like for flights and rental vehicles, but I’ve never needed to use this insurance, neither during the 1 year I’ve had the Chase Sapphire Reserve, or at all throughout my entire life of travel. Thus, because it is so difficult to predict when emergencies and inconveniences will happen, I’m not going to assign a concrete value to travel insurance.

This is a lot of information, a lot of which is situational. But if you want a raw number without having to account for the arbitrary value of benefits, it is $319.18. I will passively make about $319.18 each year just for using the Chase Sapphire Reserve instead of a no-annual-fee credit card.

With benefits considered (including the introductory offer), that number goes up to $1,189.18 earned in the first year (non-repeatable, of course).

 

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Re: “How do you avoid spending all your leftover money?”

Within the realm of finances, one of the more relatively frequent questions I get asked is how to avoid spending all your leftover money. Everyone knows by this point that they need to save money, but with a nice, padded bank account, it can be very easy to “forget” to save a set amount during a particular month, and it’s even easier to feel “accomplished” seeing a large sum in your savings account and thinking that you already have enough.

I am by no means rich, but I personally have fallen into this scenario before, and the best recommendation I have is to “create expenses.” I’ll explain.

I am very attentive and “obedient” when it comes to addressing expenses. I make sure everything is paid on time, but not so early that I miss out on interest yield. I never forget about any obligations, and I plan ahead to ensure that obligations continue to be met even in potential emergency worst-case-scenario situations. With that being said, I’m essentially exploiting the way my brain works by triggering that sense of responsibility by creating fake expenses.

As a preface to this, the “my savings account is big enough” argument should be completely invalidated if you have less than 6 months’ worth of living expenses saved up. A lot of people say 3 months’ worth is enough, but remember, the emergency itself that is causing you to lose your source of income will likely also directly drain your funds as well (for example, an injury that will rack up medical expenses), and there is no guarantee that you will recover and return to normal in a maximum of 3 months.

Going back to the main topic at hand, let’s create an example and say your monthly income is $5,000. Your expenses in this example are as such (heavily grouped and rounded for ease of calculation):

Rent (or mortgage plus other homeowner expenses) $1500
Utilities (power, gas, water, sewer, trash, phone, Internet, etc.) $300
Medical insurance (health, dental, etc.) $300
Vehicle (loan/lease, auto insurance, fuel, maintenance, etc.) $800
Student loans or other miscellaneous installment loans $200
Food (groceries, restaurants, etc.) $500
Personal care (haircut, gym membership, etc.) $100
Household products and other goods $100
Subscriptions (Amazon Prime, Netflix, Spotify, credit card annual fee, etc.) $50
Travel and other leisurely activities $150
Gifts and charitable donations $100

In this example, you have $4,100 in monthly “expenses,” leaving you with $900 remaining – I put “expenses” in quotation marks because you’ve already taken into account a very large food budget for eating out at restaurants, as well as an additional leisurely spending stipend, as “expenses.” Most people know that all $900 should be going straight into savings, but it’s easy to add an extra $50 here and an extra $100 there and end up shrinking your savings amount.

First of all, make sure you’re not forgetting about any expenses. Are you an independent contractor who runs their own business like I do and doesn’t get income tax withheld? Even if you’re a godlike optimizer of deductions of business expenses, you should be expecting to set aside at least $500 or so per month for income tax, unless you want to go from tax avoidance dangerously close to tax evasion. Are you saving for retirement? Making maximum contributions to an IRA means another ~$500 per month. Combine those two extra items you forgot, and suddenly, you’re short of money, have no savings, and need to cut back on other expenses.

Similar to how you’re budgeting leisure and luxury as expenses into your spreadsheet, also itemize savings as different, individual expenses instead of just lumping everything together as “savings” or “leftover.” Set specific goals for yourself on where each component of your savings is going, and create different savings accounts (where applicable) to keep track of each individual goal (savings accounts are usually either free or have very low daily balance requirements to waive the monthly fee).

Similar to the expenses above, here are some very simple example savings goals (mostly relevant to someone around my age) that you can tack onto your budgeting spreadsheet in the form of “expenses” to turn up the pressure to set aside money for said goals (as well as their corresponding monthly cost):

Maximum $5,500 yearly contribution to a traditional or Roth IRA $458
Maximum $19,000 yearly contribution to a 401k $1583
20% down payment on a $350,000 house purchase in 10 years $583
$15,000 for a wedding in 5 years $250
$15,000 for the first year of newborn baby expenses in 5 years $250
$35,000 Bachelor’s degree fund for a newborn starting school in 18 years $162

Being able to cover all that pushes you into the six-figure yearly salary range, and then you end up getting more expenses piled on just by the fact that you’re richer – you’ll be pushing a 24% tax bracket, you’ll need to purchase more insurance to protect your life and your investments, etc. As you can see, things can very quickly spiral out of control, and it’s all about perspective – you can always put yourself in a situation where it feels like you never have enough money.

So, coming full circle, how do I personally avoid spending all my money? I expand my budgeting spreadsheet to include items similar to the second table, but custom-catered to me specifically. My personal budgeting spreadsheet goes nearly 100 rows deep, and at the end of each month, I “spend 100% of what I earn” … though after reading this post, you know that that’s just an illusion to ensure I’m financially set for my future.

 

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Things you can buy instead of the 2020 Jeep Gladiator Launch Edition

Ever since suddenly being very interested in pickup trucks out of nowhere, I’ve been following pickup truck and truck modification news pretty closely, and I get excited when something fresh comes into the market. When Jeep announced that they would be releasing a pickup truck of their own, I was pretty excited; even though I personally would never buy a Jeep myself because it just really isn’t my style, having more mid-size trucks available in the market ramps up the competition and encourages other automakers to improve their own vehicles.

Then, I saw the 2020 Jeep Gladiator Launch Edition pricing. On April 4, they went on sale to celebrate the new pickup truck, and only 4190 Launch Editions are being made (that is paying homage to the 419 area code of Toledo, Ohio, the home of the Gladiator). The price? MSRP US$62,310.00.

… I like going to automobile manufacturers’ websites once in a while to load up the vehicle builder/configurator and see what kinds of options are available. I thought this would be a great time to do that just so I could see exactly what else you can buy instead of a $62,310 mid-size pickup truck.

  • 2019 Ford F-150 Raptor with 801A – $60,540

    Probably the truck that is given most frequently as the answer to the question “what is your favorite pickup truck,” the Ford F-150 Raptor with the 801A equipment package (which includes everything included on the standard 800A package, plus 10-way power heated leather-trimmed seats, power-adjustable pedals, and a power-sliding rear window) is $1,770 cheaper than a 2020 Jeep Gladiator Launch Edition.

    Yes, the Ford F-150 Raptor, the truck that most truck enthusiasts would call their “dream truck,” and then follow it up by saying “but it’s way too expensive to actually buy,” is cheaper than the Launch Edition. Now sure, a lot of dealerships actually sell the Raptor at prices higher than MSRP, but if you want to maintain the example, you can just take the 801A upgrade down to the standard 800A, then there’s nothing more you can say.

  • 2019 Ram 1500 Rebel, fully optioned – $60,290

    Not a fan of the Ford Raptor? Go to the Ram 1500 Rebel configurator and click on literally every single available option for a fully-optioned truck, and you can get it for $2,020 cheaper than a 2020 Jeep Gladiator Launch Edition. This includes options like the 5.7L V8 HEMI MDS VVT eTorque engine, air suspension, the Rebel 12 package (which comes with the 12″ tablet-like display), Level 2 equipment group, bedliner and tonneau cover, and power sunroof… and literally everything else, because I actually mean fully optioned.

    Remember that Ram was the first manufacturer to introduce the oversized center console display. That, combined with the black leather interior with tastefully attractive red contrast stitching and accents throughout the cabin, and the fully-loaded Ram Rebel feels like you’re driving a top-tier luxury vehicle off-road.

  • 2019 Ram 2500 Power Wagon with Level 2 Equipment Group and 12″ display – $62,385

    Don’t forget that the Jeep Gladiator is a ¼-ton, mid-size pickup truck, and the two examples I gave above are ½-ton, full-size pickup trucks. But is that still not enough for you? Then take a look at the ¾-ton Ram 2500 Power Wagon – you even have the luxury of tacking on a Level 2 Equipment Group and the iconic Ram 12″ display and only exceed the cost of the Jeep Gladiator by $75.

    All of these trucks are still very off-road-capable vehicles – that’s not unique to the Jeep Gladiator. But, beyond the obvious increase in payload and towing, keep in mind that the Power Wagon actually feels like a luxury vehicle on the inside, as opposed to the Jeep Gladiator that seems a bit too committed to the off-road look-and-feel.

  • 2019 GMC Canyon Denali… AND A 2020 TOYOTA COROLLA – $62,245

    Being the owner of a 2018 GMC Canyon, I felt like it would be appropriate to include it as an example in my list. A 2019 GMC Canyon Denali with 4WD is currently $43,240, and the starting MSRP on a 2020 Toyota Corolla is $19,500; combined, they are $65 cheaper than the Jeep Gladiator Launch Edition.

    Yes, this does indeed mean that you can get a Denali, the sub-brand recognized among pickup truck enthusiasts as the “luxury GMC,” as well as a small daily driver sedan that gets over 30 MPG in fuel efficiency, and you’ll still have money left over for a little cargo tote for your trunk straight from the Toyota dealership.

  • A 20% down payment on a $311,550 house

    … You get the point.

Honestly, Jeep has to know that the Gladiator Launch Edition is overpriced. They might have been able to pull off something like this for the Jeep Wrangler, because the only “competition” to the boxy off-road vehicle is basically the Mercedes-Benz G-Class, and those two aren’t really that com­pa­ra­ble. With no competition comes market control, and a Jeep Wrangler Rubicon Launch Edition at the $60k+ price point might have worked.

But entering the already-very-competitive pickup truck market, then proceeding to price themselves to compete against full-size trucks as well… they’re really preying on Jeep fanatics who like driving with the doors off and top down, because once capitalism kicks in, I foresee unbelievably high dealer discounts off MSRP for the Jeep Gladiator.

 

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