|
Spicy Soba Noodles posted:I just started working this week, no joke. I haven't even gotten my first paycheck. I don't even have the phone yet. I'm getting it on borrowed money from a trusted friend, who I was going to pay off bit by bit. I don't have a budget because I just got a steady job. Also, I have no idea how to make a budget. I figured I'd learn how when I started making money. If a phone is your only monthly bill, I'm guessing you live at home. That's a good start. Budgeting means "what monthly expenses will I have". Deduct your monthly expenses from your monthly pay, and that's your excess money. And you can use the excess money towards paying off your debt. This is a simple budget calculator you can play around with: http://www.youcandealwithit.com/borrowers/calculators-and-resources/calculators/budget-calculator.shtml Let us know what your debts are on Credit Karma along with the interest rates
|
#
?
Jul 1, 2014 02:04
|
|
|
|
| # ? May 11, 2024 13:57 |
|
|
Spicy Soba Noodles posted:I just started working this week, no joke. I haven't even gotten my first paycheck. I don't even have the phone yet. I'm getting it on borrowed money from a trusted friend, who I was going to pay off bit by bit. I don't have a budget because I just got a steady job. Also, I have no idea how to make a budget. I figured I'd learn how when I started making money.
|
|
#
?
Jul 1, 2014 02:08
|
|
|
26 year old male. I was in an auto accident early this year. As a result of this accident I will be receiving two payments: $4000 for diminished value on my vehicle $13,0000 for uninsured motorists coverage and medical bills ------------------ Total $17,000 I am wondering if I can get some advice on what to do with this money. Currently I am employed as a software engineer making ~$90,000, in addition I have about $5,000 of self employment income. My debts are as follows: Student loan @6.8% $13,100.00 Auto loan @2.9% $13,000.00 I do not currently have an emergency fund as I have been aggressively paying back my student loans(~$1,500-$2000/month). Not necessarily worried about a lapse in employment, I work in a field where it is easy to find employment quickly. Obviously this is not a long term goal, only until all debts are paid. At this time I have only been contributing to a 401k for about 6 months. Some options I was thinking about ------------------------------------ 1. +Pay off student loans, pay remainder against auto loan 2. +Pay off student loan, contribute remainder to IRA 3. +Pay off student loan, put remainder into savings account 4. +other? 5. +Pay off nothing and buy lotto tickets
|
|
#
?
Jul 2, 2014 15:12
|
|
|
Do you have medical bills that need to be paid, or did they just give you 13k that wasn't really necessary for bills? Since you don't have an emergency fund, my vote would be for option 3. An IRA is nice and all, but you can start contributing once those student loans are paid off(and at 1500-2k a month, you should have no problem maxing it before the end of the year). I'll take a 6.8% guaranteed return any day of the week. It's great that you aren't worried about a lapse in employment, but situations can change and a medical emergency that would keep you from working could theoretically chew through your short term disability leave, etc. so having an emergency fund would be a great idea. Nail Rat fucked around with this message at 15:36 on Jul 2, 2014 |
|
#
?
Jul 2, 2014 15:14
|
|
|
Nail Rat posted:Do you have medical bills that need to be paid, or did they just give you 13k that wasn't really necessary for bills? Luckily the health insurance company who had been picking up the tab wrote it off and I do not have a lean on my account. My lawyer confirmed that this is the case and I have a letter from insurance company. So I get to keep all the $ paid out from uninsured motorist claim($13,000).
|
|
#
?
Jul 2, 2014 15:50
|
|
|
Yeah wipe out the student loan and start on your emergency fund. After that's filled out you can decide if you want to hammer on that auto loan or start worrying more about your retirement investments with your future extra in your paychecks.
|
|
#
?
Jul 2, 2014 15:54
|
|
|
DholmbladRU posted:Luckily the health insurance company who had been picking up the tab wrote it off and I do not have a lean on my account. My lawyer confirmed that this is the case and I have a letter from insurance company. So I get to keep all the $ paid out from uninsured motorist claim($13,000). I'd set aside ~1mo of expenses and then knock out most of the student loan. Keep aggressively paying down debt. Once it's zero'd out, get that savings up to 3-6mo depending on your risk tolerance. Nice work on the income and savings side of things. Compare that to SloMo, rofl.
|
|
#
?
Jul 2, 2014 16:00
|
|
|
SiGmA_X posted:I'd set aside ~1mo of expenses and then knock out most of the student loan. Keep aggressively paying down debt. Once it's zero'd out, get that savings up to 3-6mo depending on your risk tolerance. He's got 17k and the student loan is 13k - considering he has been paying down up to 2k a month on the student loan, I think he can pay off the student loan entirely and still have a couple months' worth to put into his new emergency fund.
|
|
#
?
Jul 2, 2014 16:03
|
|
|
SiGmA_X posted:How did you manage that?! You lucky guy! That's super rare, carriers want their money back. Lucky! When someone is in an auto accident a lot of times their health insurance provider will pick up at least a portion of the bill. In some states there is no subrogation and you would not need to pay back health insurance company. The state I live in however has subrogation. Luckily the health insurance company said dont worry about it and just ate the cost, maybe because it was only $6,000 in medical costs I don't know.
|
|
#
?
Jul 2, 2014 16:09
|
|
|
How do y'all know if you can afford something? I know that sounds like a stupid question. But I'm doing OK financially, at the moment, and I want to buy a new motorcycle (which I'm aware is the financial equivalent to setting fire to a pile of money) after having some bad experiences with used bikes. I'm 28, grossing ~$85k/yr. No debt. Expenses: $1,000/mo rent+utilities $330/mo car lease payment, 18 months remaining - insurance is paid for by girlfriend, no gas since it's an electric car, no maintenance as it's under warranty $400/mo groceries - I like the good stuff $300/mo eating out $500/mo shopping, gifts, entertainment, misc. $1220/mo - ESPP deferral (savings) $370 + 220 = 590/mo retirement savings with match Assets: Cash (to be invested in a Vanguard fund shortly) - $10k (6 months of ESPP deferral) Roth 401(k) - $6k Seeing this picture of my financial health, how incredibly retarded would it be to get a new bike?
|
|
#
?
Jul 2, 2014 17:25
|
|
|
I had a long reply typed out discussing "Can I afford it" vs "Can I afford the payment" but in reality this is all I need to post:Radbot posted:incredibly retarded
|
|
#
?
Jul 2, 2014 17:33
|
|
|
Especially with a $330 car lease payment already 
|
|
#
?
Jul 2, 2014 17:37
|
|
|
Radbot posted:How do y'all know if you can afford something? More importantly, spending that much money on a hobby when you have no real emergency fund (since the 10k is going to stocks soon right?) seems like a bad idea. I'd say at least wait until you have a real emergency fund (which I guess means you could just leave the current 10k in cash, and just invest further savings into stocks). I mean, financially it'd still be a bad idea, but mostly in the sense that any hobby that costs several thousand dollars up front is financially a bad idea.
|
|
#
?
Jul 2, 2014 17:39
|
|
|
Nothing wrong with used motorcycles just like, get it checked out by a mechanic first. What was the bad experience?
|
|
#
?
Jul 2, 2014 17:39
|
|
|
The benefits of my HSA are just now dawning on me, but I unfortunately set my contribution this year at $1250 ($750 from me, $500 from employer). It's too late to change my contributions since I can only do it once a year; would it be dumb of me to deposit additional funds from my checking to get it up to the annual max? I'd like to get it at a point where I can have some of the funds invested. I'm assuming there's no tax benefit whatsoever, since at this point my contribution is below-the-line and I'm not going to be able to claim it as a deduction, since I don't really have any deductions otherwise and anything I'd contribute will be lower than my standard deduction. 401k, Roth IRA, ESPP are already maxed out, so those options are taken care of. Thoughts?
|
|
#
?
Jul 2, 2014 18:12
|
|
|
I'm pretty sure you don't need to itemize deductions for HSA but you would have to file an additional form where you report the extra contributions. But IANAA. edit: even if you have to itemize, keep in mind state income taxes are a deduction. Most people don't think of that one. So if you were going to put in an extra 2k and you paid a few thousand in state taxes, you can itemize and get the full benefit. Nail Rat fucked around with this message at 18:34 on Jul 2, 2014 |
|
#
?
Jul 2, 2014 18:19
|
|
|
I would just wait until the enrollment period for the HSA. Most HSAs have poor investment options anyway.
|
|
#
?
Jul 2, 2014 18:21
|
|
|
Post-paycheck HSA contributions are tax deductible when you file your taxes. You just lose the benefit of not paying FICA taxes like when you do a paycheck deduction. It's an above-the-line deduction on your 1040, it's trivial. For whatever dumb reason my employer is not set up to do paycheck deductions for HSA contributions, so I've just made a lump sum, post-paycheck, post-tax contribution every year for the past couple of years and take the deduction when I do my taxes. It's a substantial deduction if you max it out.
|
|
#
?
Jul 2, 2014 18:32
|
|
|
Interesting. So the fact that my standard deduction will exceed that contribution amount is irrelevant (i.e. I can deduct it regardless)? If so I'll contribute immediately. Thank you for the help!
|
|
#
?
Jul 2, 2014 19:25
|
|
|
illcendiary posted:Interesting. So the fact that my standard deduction will exceed that contribution amount is irrelevant (i.e. I can deduct it regardless)? If so I'll contribute immediately. Thank you for the help! Even if not, as I put in an edit above, unless you live in FL or something you can deduct state income taxes if you itemize. That plus your after-paycheck contribution ought to pass the standard deduction amount.
|
|
#
?
Jul 2, 2014 19:30
|
|
|
illcendiary posted:Interesting. So the fact that my standard deduction will exceed that contribution amount is irrelevant (i.e. I can deduct it regardless)? If so I'll contribute immediately. Thank you for the help! HSA contributions reduce your gross income to arrive at adjusted gross income (they're "above the line"). Standard/itemized deductions are below the line. They reduce your AGI to arrive at taxable income. So it doesn't matter whether you itemize or not: HSA contributions will have already reduced your AGI either way.
|
|
#
?
Jul 2, 2014 19:49
|
|
|
Nail Rat posted:He's got 17k and the student loan is 13k - considering he has been paying down up to 2k a month on the student loan, I think he can pay off the student loan entirely and still have a couple months' worth to put into his new emergency fund. DholmbladRU posted:When someone is in an auto accident a lot of times their health insurance provider will pick up at least a portion of the bill. In some states there is no subrogation and you would not need to pay back health insurance company. The state I live in however has subrogation. Luckily the health insurance company said dont worry about it and just ate the cost, maybe because it was only $6,000 in medical costs I don't know. Radbot posted:I'm 28, grossing ~$85k/yr. No debt. b) Pay off the lease first. c) Then buy the new bike with cash. d) How much is in your 401k and are you maxing your Roth annually? With your income, you should be. Nail Rat posted:I'm pretty sure you don't need to itemize deductions for HSA but you would have to file an additional form where you report the extra contributions. But IANAA. Crabby Abby posted:HSA contributions reduce your gross income to arrive at adjusted gross income (they're "above the line"). Standard/itemized deductions are below the line. They reduce your AGI to arrive at taxable income. So it doesn't matter whether you itemize or not: HSA contributions will have already reduced your AGI either way.
|
|
#
?
Jul 2, 2014 20:35
|
|
|
Nail Rat posted:Especially with a $330 car lease payment already What's about having all of your car expenses equal $330/mo on an $85k gross salary? I honestly don't feel at all bad about this, considering my housing expenses.100 HOGS AGREE posted:Nothing wrong with used motorcycles just like, get it checked out by a mechanic first. The shocks blew on my mechanic-checked 1980 motorcycle on the freeway, and almost killed me and my girlfriend. I'm done with used bikes, rational or not. Cicero posted:Those numbers you posted only add up to $4340/month. Even if your effective income tax rate is 25% you should have another grand each month. Where is it going? The $10k is my emergency fund - I'm not a proponent of idle cash when I can liquidate stocks within a week and have plenty of revolving credit with no debt. Is the general opinion here that any expensive hobby isn't worth doing? Just want to make sure I'm talking to an audience I can relate to. Let's say I purchase the motorcycle in ~October when I'll have the cash to buy it outright - what then? Radbot fucked around with this message at 21:57 on Jul 2, 2014 |
|
#
?
Jul 2, 2014 21:53
|
|
|
quote:Is the general opinion here that any expensive hobby isn't worth doing? Just be sure you know how much it's going to cost. Beyond the upfront price of the bike itself, there are the ongoing costs of insurance, maintenance, repairs, and gas. If you calculate those out and are comfortable with them, go for it. edit: for what it's worth, I think saving up the cash to buy the bike is a much better idea than getting a loan for it. Getting a loan for a hobby just sounds kind of bizarre to me.
|
|
#
?
Jul 2, 2014 22:16
|
|
|
You are paying interest on that car and are locked into the contract, just like with a loan, which is why people are calling you out on the "no debt" thing. Whether the $330/mo automotive commitment is reasonable is a whole different issue. My opinion is it could be reasonable if you knew what the gently caress you were doing but I am not sure. What's the interest rate on the lease? To answer your original question, you can afford an expensive hobby when you have the money to pay for it without compromising your short- or long-term financial stability. Right now you have inflexible commitments of about $2000 per month, a roughly 5-month emergency fund, and you are under-funding your retirement savings. Once you get the retirement savings up (max the Roth IRA every year), then use the rest of your $$ to save up for the bike. And yeah, don't forget the cost is more than the purchase price. The stock market is a bad place for your emergency fund because when we have another 2008 it may shrink by half right when you need it the most. Keeping some cash around is how you avoid bullshit like having to move back in with your parents because your sweet tech job disappears, or whatnot.
|
|
#
?
Jul 2, 2014 22:32
|
|
|
Radbot posted:Seeing this picture of my financial health, how incredibly retarded would it be to get a new bike? Your financial details aside, don't buy a new bike unless you have cash. Bike loans equate to nonconsensual intercourse and bike worth drops like a rock. I know you said you had bad luck used in the past, but there is no reason you can't find a decent ride at a decent price, especially with the help of cycle asylum.
|
|
#
?
Jul 2, 2014 23:39
|
|
|
Radbot posted:Assets: I don't get it. Given your income, why do you only have 16 grand in savings?
|
|
#
?
Jul 3, 2014 01:00
|
|
|
Radbot posted:What's Also, count the residual on the lease as part of your debt.
|
|
#
?
Jul 3, 2014 01:17
|
|
|
Appreciate the honest responses, fellas. Looks like I'll be waiting until next season at least.
|
|
#
?
Jul 3, 2014 01:37
|
|
|
Radbot posted:How do y'all know if you can afford something? Did you recently achieve this high income, or has it been high for a while? If you've had a high income for a while I'd say you are probably very poor with money to only have a grand total of ~$16k saved up. Where in the hell has the other money gone? Now if you just got this job or just finished paying back $100k in student loans you've demonstrated you're used to living on that budget I think a motorcycle is more realistic although I would still caution waiting for a bit more of a cash buffer.
|
|
#
?
Jul 3, 2014 05:23
|
|
|
I've had the job for about a year now and paid back about $12k in credit cars debt accumulated during unemployment.
|
|
#
?
Jul 3, 2014 13:20
|
|
|
Radbot posted:The shocks blew on my mechanic-checked 1980 motorcycle on the freeway, and almost killed me and my girlfriend. I'm done with used bikes, rational or not. You need to understand that there are more than 2 choices here. A 35 year old bike versus a new one is going to always favor the new one for safety, but you could look for a 4-5 year old lightly-ridden and maintained bike. Don't make a false dichotomy in your mind so that the choice always lines up with what you want, make your decisions based on what you can afford.
|
|
#
?
Jul 3, 2014 13:25
|
|
|
Yeah, I've tried that route too, only to have to crack the engine case to repair the stator after a dead battery left me stranded in an area without cellphone coverage. Walking along the road to find cellphone coverage sucks. I'd rather wait and save up enough for a bike where at least I'll have some recourse if it breaks. Plus, the bike I'm looking at is like $8k, I should be able to afford that in cash next year even after continuing to bulk up my retirement and personal investment accounts. And my fault on not listing the lease as debt. Its a 2 year lease on a Nissan Leaf, I paid nothing up front, and I got my registration fees paid for by a state tax break. I did my research on money factors, residuals, etc. and I'm confident I got a decent deal. Radbot fucked around with this message at 14:13 on Jul 3, 2014 |
|
#
?
Jul 3, 2014 14:07
|
|
|
You're paying $7920 to use a Nissan Leaf for two years. MSRP on that car is $21,480. What are you going to get next? 
|
|
#
?
Jul 3, 2014 14:29
|
|
|
I thought the only reason people leased Nissan Leaf's was because state tax credits for electric cars eat the entire cost of the lease, and it comes out close to free. That's why there's like a 3-year waiting list for them. I'm guessing you live in a state that doesn't have that tax credit. EDIT: A list of all the incentives for electric vehicles by state is here: http://www.ncsl.org/research/energy/state-electric-vehicle-incentives-state-chart.aspx EugeneJ fucked around with this message at 14:50 on Jul 3, 2014 |
|
#
?
Jul 3, 2014 14:37
|
|
|
FrozenVent posted:You're paying $7920 to use a Nissan Leaf for two years. MSRP on that car is $21,480. For that kind of coin, he could have bought my car one and a half times.  And he'd have something to drive after two years and one day. I bought a five year old Honda Shadow for $2500 and rode it daily for two years. I sold it for $2500 when I was done. Besides tires/oil, the only repair I had to do was a leaking coolant pipe for like $100. You need to start buying better motorcycles.
|
|
#
?
Jul 3, 2014 14:53
|
|
|
Radbot posted:Yeah, I've tried that route too, only to have to crack the engine case to repair the stator after a dead battery left me stranded in an area without cellphone coverage. Walking along the road to find cellphone coverage sucks. Batteries fail on new vehicles as well. My MIL had her battery die in her brand new CRV less than 5 months in, during a snowstorm in Ohio. Motorcycles are a hobby, and hobbies tend to be expensive. A brand new bike will be a used bike as soon as you drive it off the lot. Don't forget that it costs a lot more than just $8,000 when you factor in registration, insurance, maintenance, and fuel.
|
|
#
?
Jul 3, 2014 14:57
|
|
|
Yeah, it's true when you choose the base model (not what I have) and don't include taxes, registration, fees, etc. in the amount (which I have in my monthly total), it doesn't look great. It also doesn't seem great when you're not factoring in ~$125/mo in gas savings (over my old '04 Corolla @ ~36mpg), making the effective cost around $207/mo. What makes this car a particularly bad lease deal?
|
|
#
?
Jul 3, 2014 14:59
|
|
|
It's not the car, it's the lease.
|
|
#
?
Jul 3, 2014 15:00
|
|
|
|
| # ? May 11, 2024 13:57 |
|
|
FrozenVent posted:It's not the car, it's the lease. Meh, I guess I didn't feel it was a financially prudent decision to purchase a vehicle that has such uncertain residual value. Who knows what it would be worth in 5-7 years? Is it wrong that I feel totally OK with paying $7/day on all car expenses while grossing $85k a year? It's totally OK if I'm talking with the kind of PF folks who would never buy a new car or have any stupid expensive hobbies, maybe we've just got different priorities. Not to say yours won't serve you well in the future. Radbot fucked around with this message at 15:03 on Jul 3, 2014 |
|
#
?
Jul 3, 2014 15:01
|
|