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Wanted to get a little advice on my current situation, to see if any of the ideas I'm pursuing are good/bad/stupid, or something else I may not have thought of. Here goes: Income: 42,000/yr Take Home: $1207.96/pay period (After tax/etc and 6% 401k contribution) Fixed Expenses: Rent: $720/mo Phone: $80.65/mo Car Pmt: $367.98/mo Car Insurance: $149.14/mo (Working on lowering this) Internet: $68.12/mo Student Loan: $149.98/mo Variable Expenses: Water: $30-50/mo Power: $80-150/mo Debt: Credit Card @ 19.9%: -$350 (Limit: $700) Credit Card 2 @ 19.8%: -$1363.39 (L: $1500) Credit Card 3 @ 0.0%: -974.16 (L: $1000) 2012 Income Tax: -$647 Student Loan: 4307.08 @ 6%, $6121.21 @ 6.8% Savings: Precisely gently caress-all. 401k Balance: $3912 I'm trying to knock out some of this credit card debt. Currently I am budgeting $162.50/paycheck to go into my savings to pay off the Income Tax, as I will get paid again on 3/8, 3/22, and 4/5 for a total of $650. I am considering some of the following options: - Temporarily stopping my 401k contribution. This will put ~$70 extra in my pocket per paycheck, but obviously I'm not making money on it in my 401k, and I'm giving up the company's 6% match. Trading a today problem for a tomorrow problem. - Applying to lower my student loan payment. I seem to be able to go as low as $50/month. Again, money in pocket, in exchange for the loan suffering. - Taking a loan out of my 401k to pay off the two interest bearing credit cards. I've modeled out a loan @ 4.25% over 12 months, resulting in a payment of approximatley $67/pay period. Combining this with option 1, I'd see a huge reduction in interest rate, without much effect on my take-home. The con is the impact to my 401k interest. Also the "repay immediatley if you lose your job" caveat of a 401k loan. - Focus on the income tax, then begin using the money allocated to that to pay off credit cards after april 15. Are any of these options good ideas? Is there something else available I may not have thought of? Deviant fucked around with this message at 20:57 on Mar 4, 2013 |
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Mar 4, 2013 20:44
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You don't list groceries on your budget, and that car payment is a killer. Are you upside down on it?
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Mar 4, 2013 20:56
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reflex posted:You don't list groceries on your budget, and that car payment is a killer. Are you upside down on it? Honestly, I just don't budget my groceries that carefully, which is one of my flaws. I tend to eat in the cafeteria at work a lot lately, or go spend my money on booze, which is stupid, I admit. And yeah, I purchased it relativley recently, I owe 17,453.85 at 3.99% I'm trying to get a roommate, which will obviously knock rent way down, but that's a work in progress and isn't cemented by any means.
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Mar 4, 2013 20:58
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After all your fixed expenses + minimum payments, you're spending around ~$1575 + groceries + gas + alchohol + eating out + entertainment + clothing + recreation + hobbies (you're missing some budget items here) per month. Incoming: $2400/month Out the door: $1575 + all that stuff/month Whether you're bleeding more or not every month depends on how much all that other stuff costs. If you want to kill some loans, you need more income and/or less expenses. For instance: - Get a roomate: $495 a month saved (utilities + internet included) - Get out of that phone plan and try and get on pay-as-you-go: $40-50 a month saved - Do not eat out; instead buy groceries and learn to cook: $$$$$$ a month saved Streamline the rest of your stuff in the same way.
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Mar 4, 2013 21:13
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reflex posted:After all your fixed expenses + minimum payments, you're spending around ~$1575 + groceries + gas + alchohol + eating out + entertainment + clothing + recreation + hobbies (you're missing some budget items here) per month. Yeah, I'm definetley trying to lower my expenses, I didn't list the gas+booze+bullshit+etc items because honestly, I don't know how much I spend on them each month, and it's probably pretty variable. I need to try to track those items more. The question then, is what to do regarding these other items? The income tax HAS to get paid, obviously, and I'd prefer not to let those credit cards tick any longer than I have to.
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Mar 4, 2013 21:17
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Deviant posted:Yeah, I'm definetley trying to lower my expenses, I didn't list the gas+booze+bullshit+etc items because honestly, I don't know how much I spend on them each month, and it's probably pretty variable. I need to try to track those items more. You should consider signing up for something linke Mint.com, because it will make tracking this sort of spending a lot easier for you to do, and probably surprise (potentially shame) you as to where your money is going. It's a very handy tool to have, and really helped us bring our spending under control and keep it that way. Even if things are variable you can still budget and plan them over longer terms. I have no idea if you can request some sort of extension on the Income Tax payment, but it's probably just best to take care of that as soon as you can. You are right that you need to knock out those cards as well, 19.9% is killer. You aren't actively using those cards, right? If so, stop doing that. I think the first step needs to be for you to get yourself a complete, written budget and work out where you can kill some of your costs (like your insurance and phone, maybe internet, your power bill seems really high but you don't have a gas bill so I guess that's also your heating/cooking/water heater, etc?). At that point you can work out how much available cash you can throw at the cards and how long it will take you to clear them - I would be wary of messing with your 401k because you will be losing out on the employer match in addition to whatever that money would have turned into, and keeping those might be a better return than paying down the cards with the same cash.
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Mar 4, 2013 21:35
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You have to set tangible limits on yourself. You can't say "Welp, I don't know what I spend on anything" anymore. Look at the previous six months and figure out a monthly average. I budget $150 for gas every month even though I rarely break $100. That way I'm never screwed when it comes to filling up my car. Let's say you're spending $150/month on booze. First paycheque of every month, withdraw $50 hard cash from the bank, put it in an envelope with "booze" written on it, and ration it. Once you go through that $50, tough poo poo until the first paycheque of next month. You just freed up $100/month. I don't really understand what you want me to tell you without looking at hard numbers. Maybe your entertainment, eating out, etc. is completely reasonable, and maybe it's not. Regardless of what the situation is, if you are short of money every month, you have to spend less and/or make more.
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Mar 4, 2013 21:36
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Deviant posted:Yeah, I'm definetley trying to lower my expenses, I didn't list the gas+booze+bullshit+etc items because honestly, I don't know how much I spend on them each month, and it's probably pretty variable. I need to try to track those items more. The question then, is what to do regarding these other items? The income tax HAS to get paid, obviously, and I'd prefer not to let those credit cards tick any longer than I have to. You have no business driving a car that is worth almost half your annual salary and represents about 70% of your total assets. The good news is if you didn't have a car loan your total debt would be very manageable. You don't need to give it away but you do need a 3 month plan to sell it and arrange alternate transportation. Get a roommate and start living on a written budget you will be fine.
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Mar 4, 2013 21:38
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I thought the same thing, but if he bought it recently isn't he going to be badly upside down on it? In that the car will have devalued significantly already but he won't have paid much of the loan, so he'll need to come up with $$$ to sell it? I have never owned a car so maybe I have misunderstood how that works!
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Mar 4, 2013 21:42
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You're way overspending on something. It should take like two or three months max to get rid of your credit card balances and pay your back taxes. I'd also look to see where your money is going if you actually make $42,000 a year. Basically 24% is vanishing before it gets to you and you still somehow owe federal taxes. Harry fucked around with this message at 23:10 on Mar 4, 2013 |
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Mar 4, 2013 23:02
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Harry posted:You're way overspending on something. It should take like two or three months max to get rid of your credit card balances and pay your back taxes. The reason I owe this year is I under with-held last year due to poor math on my part, and collecting unemployment. Even had the guys in the tax thread help me, and nope, I'm hosed on that one. But then, if I could do math, I wouldn't be in this thread now would I?  And I'm reasonably sure what I'm overspending on lumps into the overall budget category of 'dumb poo poo'. Booze and hobbies, in that order. That being said, I switched my car insurance today, so my payments there are down approximatley $60. Deviant fucked around with this message at 23:34 on Mar 4, 2013 |
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Mar 4, 2013 23:31
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Deviant posted:That being said, I switched my car insurance today, so my payments there are down approximatley $60. What did you do to almost cut your payment in half?
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Mar 5, 2013 00:26
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You gotta do a budget man. You can lower minimum payments all you want but it doesn't change the larger picture. You need to sit down and find out where that money is going. Sign up for mint.com & link your accounts. Then google "envelope system" and also "you need a budget" (ynab) & see what works for you better. I make half what you do (okay, 3/4 this year, but half in the past) and my expenses aren't near as much AND I'm saving like $500/month. Granted I don't have a car (because I know I can't afford one), but you must be pissing away a LOT without noticing. Make a thread. You need one more than this guy. e: AND DON'T TAKE A 401K LOAN
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Mar 5, 2013 00:32
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This is a bit of a tangent, but it looks like you may be on a biweekly pay schedule. If so, in addition to all the other things you're doing/need to be doing to dig out, if you can budget yourself well within two paychecks/month there should be two months a year where you get a third check. Commit ahead of time to dumping those bonus checks in their entirety into your debt.
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Mar 5, 2013 00:36
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Josh Wow posted:What did you do to almost cut your payment in half? I got a quote from Progressive and jumped ship to them. Comparable coverage. I had 3 other people independently verify the coverage was comparable and I wasn't missing something.
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Mar 5, 2013 00:40
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How do you spend your money? If you put everything on a debit/credit card, it makes it pretty easy to look at your last 6 months of expenses. Pull it up online from your bank's site. Paste the last 6 months into a spreadsheet program. Add a column and categorize all your expenses based on the merchant name. You probably don't need many more categories than the following: transportation and fuel, grocery, restaurant/entertainment, utilities, clothing/household goods, and misc. Then write down what you think the average monthly spend in those categories has been. I think you'll be surprised, and will probably find that you spend more money than you think you do when you compare your guess to actuals. Add the other budget items there (phone, internet, cigar of the week subscription) and you'll get a more accurate picture of where your money goes. What's almost worse than having no budget is when people set a budget based on optimistic expectations without looking at historical spends. "Well, $8/day on food sounds right, so I'll set that budget and put $800/month toward savings!" doesn't work if you don't realize you've spent closer to $12/day for the last 6 months. They then blow through their budgets and get discouraged. I'm also a big fan of taking monthly budgets and drawing them out to daily budgets, just to visualize. Here's a snapshot (with nonsense numbers, don't sass me) that I used earlier in the thread.  Grey items are critical bills. Orange items are a little more discretionary. Purple are "I really should be doing these" items. Overspend in Orange, you'll be raiding your purple savings. When that runs out, you're going to have serious problems paying the grey items. Daily budgets give me a good sense of how I'm trending to end the month. If I spend $16 one day to go to lunch with my co-workers, I know I'd better spend way less than $9/day on food for the next few days to make that affordable.
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Mar 5, 2013 01:00
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Going to second setting up an account on Mint. It makes it very easy to track your spending and progress without a huge time sink.
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Mar 5, 2013 05:13
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tldr at bottom. Goal: Save money for law school/life after undergrad Savings account: ~$11,500 at Ally getting 0.90% Checking account: ~$800 Expenses: Very few. I'm an undergraduate, college + dorm + food plan is completely paid for. I drive very little, I spend very little on alcohol. I probably spend ~$50/month on protein/supplements for working out, $50/month on additional food. I probably spend more than I should right now, but could likely get away with ~$300/month budget. Income: School year: $0 Summer: Co-op options for ~$700/week minus taxes for 3 months (June, July, August.) I've also played poker part-time for ~3 years and can expect to average ~$15-$20/hour doing this, but considering I'll be working full time, I probably won't be doing this for more than 6-10 hours per week. I need ~$2,000 put aside for poker to stay safe from downswings. Credit cards: One $1700 limit Visa that I recently got to start building credit. Always paid off in full. Credit: I went from "not enough credit history" to having a score of ~750 this month. I'm not sure how this will translate into the likelihood of getting a good loan for grad school. Other than that, I don't plan on needing to take advantage of credit. A few options for the summer: 1) Live with my family for free including food, get a co-op for ~$700/week minus taxes for 3 months (June, July, August) until school starts in September. Expenses would be a lot of gas (commute + 50 minute drive to girlfriend on most weekends), plus the same ~$200-$300/month in total expenses that I spend during the school year. 2) Live in an apartment, pay for rent+food, get a co-op for ~$700/week for 3 months (least likely option.) 3) A company is willing to pay for housing if I relocate for a 3-month co-op (will cost me $250 in gas to get there, $250 in gas to get back.) Again, ~$700/week minus taxes, but I'll be paying for all food + the usual expenses. I plan on graduating from undergrad in May 2015 and will be working for ~$50-$60k/year starting until I can finish saving up enough for law school. Any advice on what my game-plan should be? I know 0.90% savings at Ally is decent + convenient to have permanent access to all of my funds, but I don't really see myself even needing even half of it by the time I graduate, especially if I manage to save $7-$8,000 more this summer. I think getting a 2-year CD would only end up saving me a pretty insignificant amount per year, so should I just leave everything in savings, look into the beginner investing thread, or do something else? Any other advice? tldr; - Very few expenses - ~$12,000 saved - 2 years until graduating from undergrad (I will have real expenses then, but will have $50-$60k/year income) - Current income is $0 during school year, $700/week for 3 months in summer - Money is currently being thrown into 0.90% savings account. Should I continue doing this, get a 2-year CD, invest, or do something else? Blinky2099 fucked around with this message at 18:20 on Mar 5, 2013 |
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Mar 5, 2013 18:09
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Step 1, read the law school thread  Just leave your money in the savings account for a few years until your mid- to long-term financial picture is a bit more clear.
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Mar 5, 2013 18:23
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slap me silly posted:Step 1, read the law school thread edit vvvv reflex posted:Do not assume you will make $50k a year out of undergrad. Blinky2099 fucked around with this message at 18:38 on Mar 5, 2013 |
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Mar 5, 2013 18:27
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Do not assume you will make $50k a year out of undergrad.
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Mar 5, 2013 18:31
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It's a strategy, I guess! I don't know anything about law anyway. Savings account advice stands 
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Mar 5, 2013 18:31
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reflex posted:Do not assume you will make $50k a year out of undergrad. This. My husband is making 45k a year with his master's degree. Also - do not assume that you can use poker as income. Reading that made me physically uncomfortable.
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Mar 5, 2013 18:43
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I think you need to narrow down what "saving for law school" means and then go from there.
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Mar 5, 2013 18:43
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dopaMEAN posted:Also - do not assume that you can use poker as income. Reading that made me physically uncomfortable. Harry posted:I think you need to narrow down what "saving for law school" means and then go from there. A really broad estimate would be ~$50,000 per year for 3 years of law school, likely without income. I don't plan on saving up $150,000 before going, which is why I figured it'd be okay to generalize "save as much as possible so that when I do go, I can minimize the amount of interest I'm paying through loans."
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Mar 5, 2013 18:55
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Blinky2099 posted:edit vvvv It is not a safe assumption. You could end up on your rear end. I did a technical college degree, very specialized field, where the starting salaries are usually 60k+ and the industry demand for new people is best described as "OH MY GOD PLEASE COME WORK FOR US PLEASE PLEASE PLEASE". Some of my classmates, five years out? Still making about 40k, because they went for the "fun" jobs. One of them went into customer service because welp, turned out she didn't like the job she spent four years training for. Also, read the law thread, take your fingers out of your ears and listen to all the stories of people with the same plan and background who ended up three years out of undergrad with tons of debts and no jobs. As cliche as it sounds, that could happen to you. Do not assume the best case scenario is the one that's going to happen.
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Mar 5, 2013 19:01
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FrozenVent posted:It is not a safe assumption. You could end up on your rear end.
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Mar 5, 2013 19:03
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You're talking about a very short timeframe (2 years till big expenses) in a volatile time of life (you're young and still not fairly certain where you'll land). I don't think I'd worry about having $11-$20k "just" sitting in savings, accessible for any emergencies/relocations/whatever you want and earning a small pittance in interest.
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Mar 5, 2013 19:12
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As a college sophomore in a technical field with school paid for and some actual savings, you are doing great, keep at it. Just put a hard limit on the poker losses and think clearly about law school when the time comes.
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Mar 5, 2013 19:15
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Here's an easy one, I just need someone to nudge me in either direction. I am getting a bonus from work to the tune of around 1300 dollars this week. I currently have about 3200 in my savings account and I have a student loan that I make 500 dollar monthly payments on that's currently sitting at around 9k with a 5.75% interest rate. Where do I put my bonus? Savings or my student loan? Or should I go with the third wild card option and split it down the middle?
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Mar 5, 2013 20:29
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Handsome Ralph posted:Here's an easy one, I just need someone to nudge me in either direction. Are you getting more than 5.75% on your savings account?
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Mar 5, 2013 20:35
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Fraternite posted:Are you getting more than 5.75% on your savings account? Nope. I see where this is going, student loan it is then?
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Mar 5, 2013 20:41
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Now that ING has transformed into Capital One 360 or whatever can anyone recommend a similar online savings account? I have a roth IRA that I opened through ING - is that something I can transfer to another bank or should I just leave it there?
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Mar 6, 2013 05:34
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Deviant posted:Honestly, I just don't budget my groceries that carefully, which is one of my flaws. I tend to eat in the cafeteria at work a lot lately, or go spend my money on booze, which is stupid, I admit. Yeah man, cafe food is going to kill you here, at my work it's about $10 for something basic and a drink. assuming thats daily and breakfast every second day it is going to run you $70 a week, or $315 a month. Booze is one of those things you need to evaluate, If you are using is for leisure then just keep an eye on the spend.
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Mar 6, 2013 10:37
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Could anyone recommend the best company (preferably online) that I could use to transfer money overseas? My wife sends money to her grandmother in Peru once a month and she's been driving all the way across town to a Hispanic grocery store (For some reason it never dawned on me that there was probably a better alternative until now) just to do it. So not only do we pay for the transfer but also for the gas and the risk of an impulse buy. Thanks. Sephiroth_IRA fucked around with this message at 14:29 on Mar 6, 2013 |
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Mar 6, 2013 14:08
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origami posted:Now that ING has transformed into Capital One 360 or whatever can anyone recommend a similar online savings account? What's the reason for switching? Capital One bought ING nearly 2 years ago so nothing has changed recently except the color scheme.
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Mar 6, 2013 15:54
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FCKGW posted:What's the reason for switching? Capital One bought ING nearly 2 years ago so nothing has changed recently except the color scheme. I'm mostly curious what other folks are using for online banking. Capital One doesn't have the best reputation and it got me wondering if there was a better option.
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Mar 6, 2013 16:17
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Literally nothing has changed except a website re-design and you're thinking of jumping ship? Just stuff it wherever your checking account is. Why doesn't COF have the best reputation anyway, I haven't heard anything (except their website looks like it's for a gym).
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Mar 6, 2013 16:21
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FCKGW posted:What's the reason for switching? Capital One bought ING nearly 2 years ago so nothing has changed recently except the color scheme. You may laugh but the actual visible change is what got me to get around to changing, in fact.  origami posted:I'm mostly curious what other folks are using for online banking. Capital One doesn't have the best reputation and it got me wondering if there was a better option. I've got an Ally money market savings (not a fund, click ? under my name and look for an explanation I'm lazy) which is at .9 but they're not any less evil probably than CapitalOne. They're purple though and I like their website design so  e: Also you get a card you can use at ATM's and they refund fees which is more than my CU does.e: CapitalOne does have a bad rep for whatever reason. I personally am not fond of them because I'm pretty sure I used to have rewards on my credit card with them and it disappeared  Also they charged me a late fee one time before the deadline had passed AND after I'd paid, although they did refund it as soon as I called them on it.
Eggplant Wizard fucked around with this message at 16:25 on Mar 6, 2013 |
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Mar 6, 2013 16:22
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Eggplant Wizard posted:You may laugh but the actual visible change is what got me to get around to changing, in fact. I lament the loss of my giant orange bouncing ball but such is life. I dunno, ING changed from a large multinational finance company to another large multinational finance company so I really see no difference with the change. The services are the same, I can still have multiple savings account and a checking account that comes with ATM card and fee refunds so why switch? I'm also not hung go on credit unions and use Chase for my main banking and Wells Fargo for my mortgage so I guess I'm part of the problem with America today?
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Mar 6, 2013 17:23
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