Keep gas guzzler or get new car?

[Nick2219]

@scfr thank you for the help, honestly that's what I was thinking too. I bought the jeep for the tough New England winters and it has definitely been worth it. I don't think I'll need an suv when I move so a beater will suffice just fine. It;s certainly off topic but does anyone have any advice for a 22 year old looking to set up their first 401k? The options seem endless and have no clue how to begin that process.

[SeanH]

401ks are typically provided by your employer. Depending on the options your employer provides you may have access to a ROTH 401k or a traditional 401k. Selecting between the two of those right there is a topic unto itself (and also requires you to consider starting up your own ROTH IRA - a retirement vehicle that you would need to setup on your own ideally through a company such as Vanguard or Fidelity). Part of that decision making process will focus on whether you receive a match from your company. In general, the first piece of advice you'll receive concerning a match is that if you don't take it you left money on the table.

Within these vehicles (401k, ROTH 401k, Roth IRA) you select certain funds. A 401k offered through your employer will likely have limited options for you to invest in (a handful of "target date funds", maybe some index funds, and likely a number of overly specific-expensive active management funds). A ROTH IRA on the other hand is going to have a larger selection of funds (in theory you'd have access to the selection offered by Vanguard/Fidelity without the limitations your company put in place), but there may be initial limitations on your ability to purchase certain funds because they have minimum starting allocations.

I believe the standard advice which you should have no difficulty finding around here is:
Fund your company 401k up to the point where you receive the maximum match.
Fund a ROTH IRA to its maximum potential (~$5,500)
Fund the rest of your 401k up to an amount you are capable (ideally at least 15% of your income not counting the match you received as part of the 15%), but taking into account also your ability to generate an emergency fund (possibly up to 6 months of expenses) and pay-off debts.

In the interest of not complicating things - your ideal fund is likely a target date fund which consists of some variation of stocks and bonds weighed to take into account your preference for risk and age and what not. Stay away from anything actively managed and always look at the fees. never pay any sort of pre-load fees. Ideally the expense ratio on any fund you purchase should be way less than 1%, but sometimes that isn't possible. As an example - my wife works for a small company and therefore her 401k has insane fees (1.46%). I worked for a large company - my 401k fees were much smaller (0.12%). I am holding an index fund in my ROTH at fidelity - its fee is 0.1%. A similar fund at Vanguard is 0.07%. You get what you don't pay for.

[snafu]

Let us know what choices the employer offers for 401K, fees and Management Expense Ratio [MER] as discussing choices is a learning experience. I'm sure you know the downside of buying a new vehicle is the immediate depreciation hit and increase in insurance rates. You're upside-down the moment you drive off the lot!

[scfr]

It;s certainly off topic but does anyone have any advice for a 22 year old looking to set up their first 401k? The options seem endless and have no clue how to begin that process.

You may want to start a new thread on this topic. A 401K would be through your employer, so your options will be limited.

P.S. You are correct about a Jeep Cherokee being "overkill" in the South. But you will probably want a vehicle with functioning A/C.