2015 – Here We Go

Ouch Annual Budget

Was chatting with an online friend on twitter earlier. He mentioned a book recommendation to me. Ramit Sethi’s I Will Teach You To Be Rich. Despite having read it years ago I hadn’t put together a mock annual budget. So I did that while watching Blacklist and with Suze Orman episodes playing in the background.

Some observations:

  • I eat out way too damn much. At work I can get a hot meal by using a microwave. The same at home. With a place of my own I can get used to inviting friends over more without feeling any guilt. Over $5k on food alone over the course of a year. I could see that in NY or SF if I was earning a six figure income, but I’m in Texas and not…. Some people are able to feed a single person on $100 a month. I might need to adopt some of these principles into my own life. Live in the richest country in the world and I’m in financial deficit.
  • That monthly budget is paying the minimum on my student loan which I am adamant about not doing. $800 – $1000 is my monthly goal. The townhouse equity payments are helping toward that. I pay an extra $100-125 a week without thinking twice about it.
  • I’m smarter with how I spend my money than I give myself credit for. Since starting this blog I’ve made about $20k in student loan payments. Yes I drive a new car but it’s at 0% and the total amount is less than 30% of my gross.
  • I’m impatient. Soon will be year 14 of owing student loans to Sallie Mae / Navient. Done with these fuckers. Should’ve paid them off years ago. My original goal was 2010 while still living with my parents. Quitting my job, getting a really shitty job and a slightly less shitty job, then moving to DFW and no job for 6 months before getting a shitty job that bounced my paycheck were a series of obstacles I had to face. It’s been a few years but during the middle of the process it was extremely painful and very much fresh in my mind. I don’t believe in job security anymore. In the grand scheme of life, only my individual skills will keep me employed. I see new grads from college landing jobs with starting pay higher than my own. My conclusion is working on my skills is an absolute must. Salary only increased 2% last year. Another 2% increase is nothing. Without letting greed or bitterness into the equation, it’s time to go hard. Learning from people who have already done it and getting ideas.

It’s 4AM and I need sleep. Thanks all for reading. I wish you a happy and safe 2015!

 

Month 32 Update – $25,626.16 Navient, $15,644 NMAC Total: $41,270.16

Merry Christmas / Happy Hanukkah / Happy Kwanza / Seasons Greetings:

Navient / Sallie Mae - Month 32 Update

Navient / Sallie Mae – Month 32 Update

Month 32 - Nissan Altima 2014 Payoff

Month 32 – Nissan Altima 2014 Payoff

Month 32. The last month hasn’t been particularly easy.I’ve been juggling the expenses associated with furnishing a new apartment. I spent approximately $1012 on furniture for the living room (consisting of a sofa, loveseat, ottoman) and that figure includes shipping and tax), $184 on a computer desk + chair and roughly $100 on a coffee table. I still would love to get some accent tables and a headboard but neither of those are essential right now. I’ve never spend this much money in my life and my credit card has been getting a ton of usage these last few weeks. The end is near though.

Ashley Furniture Commando - Sofa

Ashley Furniture Commando – Sofa

Ashley Furniture Commando - Loveseat

Ashley Furniture Commando – Loveseat

It looks like I will get an additional $12,000 or so as a result of the refinancing the townhouse out of my name. To me that is a significant amount of money and I’m very cautious about how to best utilize it. Ex says I made out like a bandit. The obvious way would be to apply it directly toward my student loans as I receive each installment. As of this date December 9, 2014 the amount I will receive would represent close to 47% of my student loan. Between my tax return, expected bonuses, settlement money owed to me by the glass company I worked for and “cash flowing it”, I think I can hold true to the original purpose of this blog. To be free of my student loans a few months into the ripe old age of 32. I can see the car paid off by the time I’m 34. Then absolutely no debt, my retirement savings will be well underway.

I started reading Tony Robbins Book – Money Master the Game: 7 Simple Steps to Financial Freedom. It will help me answer the question about what I’m doing with my retirement accounts. Don’t want to get killed in fees. So ready to move out, 6 more days…

As of 12/9/2014:
$5334 in 401k, $4743.89 of that is Vested. – YtD Return of 6.42%
$402.47 in Betterment Roth IRA
635.39 in TDAmeritrade Roth IRA
Total Retirement: 6371.86

Currently, my contributions are increasing by 480 each month. At this rate assuming I lose none of my principal and earn 0% interest I will have over $50k by the time I turn 40. Torn right now between maxing out Roth IRA contributions for 2014 and getting out of debt .When I’m debt free I’ll definitely max out my Roth.

Current Roth IRA balance and expected future value at age 65 - 2048.

Current Roth IRA balance and expected future value at age 65 – 2048.

Maxed out Roth IRA Contribution from 2014 to 34 years from now to 2048.

Maxed out Roth IRA Contribution from 2014 to 34 years the year 2048.

So wait what? I can have over 5x the balance / $32k by just contributing an extra $4462 one time?  These calculations don’t factor into the equation risk. The student loan payment will always be there unless I pay it off. The $450-1000 I save in not having a payment each month could easily be used to funnel money into a Roth or other investments. 13 years though of interest accumulating, feeling the weight of Sallie Mae / Navient over my shoulders. It’s almost half of my entire life I’ve owed this organization money… Think I’ve answered my question….