Solo 401K vs SEP with Waffles on Wednesday

ChooseFI | Financial Independence Podcast

Jonathan Mendonsa & Brad Barrett | Choose FI Media, Inc

Careers, Business, Investing

4.8 • 5.2K Ratings

🗓️ 24 September 2018

⏱️ 75 minutes

🔗️ Recording | iTunes | RSS

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Summary

Most game show winners don't realize they've also won a surprise tax bill. Mr. Waffles discovered this the hard way after winning a Toyota Corolla on 'The Price is Right'—then turning it into $15,000 cash by immediately selling it back to the dealership. Mr. and Mrs. Waffles on Wednesday share their unique path to financial independence, which includes navigating the hidden costs of game show prizes, educating an IRS agent on tax code, and building a life where every day feels like a weekend—not just Saturday and Sunday. Key Takeaways Game Show Experiences: Mr. Waffles won a Toyota Corolla on 'The Price is Right' and received a 1099 form for tax purposes [00:04:11] "Turned a game show win into $15,000 cash by selling my brand new car back to the dealership!" Understanding the tax implications of game show prizes is crucial [00:06:44] Always evaluate the true market value of any prize you win Tax Education: Misunderstandings regarding tax forms can lead to significant liabilities Importance of consulting a tax professional [00:07:50] "The IRS guy admitted I knew more about tax code than he did!" [00:08:54] Keep records of your winnings and consult a tax expert Creating the Blog: The couple started their blog, Waffles on Wednesday, to share their journey towards FI and connect with like-minded people [00:15:50] "Life should be about enjoying each day, not just weekends!" Entrepreneurship and Retirement Planning: Mr. Waffles emphasizes solid retirement planning for entrepreneurs Recommendation for setting up a solo 401k for enhanced retirement savings [00:31:18] "A solo 401k allows business owners to save more for retirement with higher contribution limits compared to traditional IRAs." [00:31:08] Solo 401k: A retirement savings plan designed for business owners with no employees other than their spouse [00:37:56] "Setting up a solo 401k is streamlined and efficient!" Chapters [00:00:00] Introduction and Background [00:01:40] Game Show Experience [00:04:14] Tax Implications of Winning Prizes [00:14:42] Blog Creation Story [00:31:04] Entrepreneurship and Retirement Planning [01:05:36] Financial Mistakes and Lessons [01:06:30] ChooseFI Hot Seat [01:12:20] Conclusion and Final Thoughts Notable Quotes "Financial stability opens doors to brave choices." "Life should be about enjoying each day, not just weekends!"

Transcript

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0:00.0	Today in the show, we're going to be talking about the Path to Fine, the high cost living area of LA.
0:04.2	This story includes the fully funded lifestyle change, the game show Path to Fine, the solo 401k entrepreneurship and Waffles on Wednesday.
0:11.9	Welcome to the ultimate crowdsource personal financial.
0:15.0	You're listening to Choose Appi Radio.
0:19.6	The blueprint for financial independence lives here.
0:30.0	If you're looking to unlock the secrets to financial independence and early retirement, you're in the right place.
0:37.2	Stay tuned and join a community of like-minded people who are getting all finance to you and taking control of their lives in the pursuit of financial independence.
0:46.4	Choose FI, your home for financial independence online.
1:01.0	So today on the show, we are bringing on Mr. and Mrs. Waffles on Wednesday, which may be either it's competing for the best name in the FI space or the second best right behind slowly sipping coffee.
1:11.2	We're going to explore that and we're going to get a chance to talk about the secret behind reaching financial independence.
1:16.4	And that is getting on a game show.
1:18.0	This episode is going to be absolutely fabulous and to help me with this, I have my co-spread here with me today. How you doing, buddy?
1:23.6	Hey, Jonathan, I'm doing well.
1:25.2	Well, you certainly set up some intriguing lines of conversation that I'm curious about Waffles on Wednesday. Where did that come from?
1:31.6	Game show path to FI so we got some really, really interesting topics and with that, I'm pleased to welcome Mr. and Mrs. Wow.
1:39.8	Thanks for having us with with an entrance like that. I mean, slowly sipping coffee. I'm glad to be in that company.
1:46.0	Well, we haven't gotten Mrs. slowly sipping coffee on. She's been ducking us, but we got Mrs. Waffles on Wednesday. So we're correcting that mistake right now.
1:53.8	Hey, guys, good to be here. Hey, you're too, I guess.
1:59.4	You're going to help us on this journey. But to be fair, you are the game show winner. Like tell us about that a couple of years ago, my company went on a company outing.
2:09.4	And we went to the prices right, which they give free tickets. And so we did it as a company outing. And I ended up on stage.
2:17.2	I ended up guessing the price of 3D television exactly. So I won that and then I won $500 cash for winning the prize, guessing the price directly on the nose.
2:29.6	And then I got up and got selected to play the spelling B where I won a measuring cup for guessing the price of a measuring cup.
	...

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