EDIT: I did not know my 401k contributions when I first made this post. They have now been edited into the post.
DanTheYogi Case Study
Life Situation: Hi everyone! I am brand new to MMM and FIRE. I have a lot of student debt, and little savings, but truth be told I am feeling excited about my future. I know it won't be easy, but to me that is part of the fun of it (the challenge). I am single, male, 24. I live in the Dallas, TX area (though this will change relatively soon - I will detail on this later). As with most people my age, I have made a lot of mistakes. While I have always been debt averse (I have never owned a credit card, for example), for some reason I did not apply that same line of thinking to taking on student debt when I was in college, and I currently have about $100k in student loans. I have a good degree, but I do not like the field I am in. Just to give you an idea, if I could right now, I would trade my degree to be debt free without a second thought. Alas, no reason to ponder past mistakes! Let's move on.
I have crunched my income/expenses in the past, but up to this date I still do not even have a budget. I just got finished crunching some basic numbers to provide for this post (and to give myself a needed reality check).
Gross Salary/Wages: $66,000/year
Individual amounts of each Pre-tax deductions 401k, HSA, FSA, IRA, insurance: 401k is the only one I have. I do not know exactly how much I am contributing, but I know that it is maxed to what my employer will match. EDIT: I just checked. I contribute $257.05 per month.
Other Ordinary Income: none
Qualified Dividends & Long Term Capital Gains: N/A
Rental Income, Actual Expenses, and Depreciation: N/A
Adjusted Gross Income: Not sure what exactly this would come out to minus the 401k.
Taxes: I know nothing about taxes, however I do have my 2017 W2. Here is what it says.
Federal Income: 11,843
Social Security: 4310
Medicare: 1008
Current expenses:
So, to tidy things up somewhat, I will start off by saying my take home pay per month is $3,563.
Now, for the expenses.
Bills
Rent: $1000 (approx. This includes water and a few other things. I rounded up a bit to be safe)
Electric: $90
Student loans: $723 min payment (I have consolidated most of them. Currently on a 25 year forgiveness plan. Ha)
Internet: $58
Cell Phone: $30
Auto/Renters Insurance: $126
Savings: $300
Essentials
Groceries: $330 (This was much higher than I was expecting. I eat very healthy, do not buy processed foods, yet don't care about buying organic/top-notch produce either. I also only eat out 3-4 times a month, at most. Having said that, I am very very active, so I eat a lot. I also do splurge on a few things. I buy frozen blueberries at nearly 4 dollars a pound and eat 1-2 cups a day. I also buy oat groats at 3.60 dollars a pound, and eat these every morning as well. Then I will often make random purchases like dates and other expensive produce. I otherwise have bulk bags of 15lbs+ of rice, quinoa, potatoes, and oats that I eat daily. So I know my work here is to cut out the more expensive items and stick to the cheap bulk).
Gas: $200 (I know this is terrible. There are 2 factors at play here. One, my car guzzles gas. I own a 2001 chevy tahoe. Not great for a single guy in his 20's, but it's the only car I have owned for almost a decade now. My parents essentially gave it to me. The other factor is that I drive a lot. Not to work either, which is a 3 mile commute. Pretty much every night I am driving - Tue/Th I drive an hour round trip to rock climb. Wed/Fri/Sat I drive an hour round trip to go dancing. On the weekends I drive 90 minutes round trip to play basketball with my brother. Semi-frequent trips to Austin to see my parents/family, 6 hours round trip. Obviously these things add up quite quickly).
Other
Gym memberships: $67 (Climbing membership is $48. This obviously has to go. However, the other is a $19 membership to my local rec. I am not convinced I should drop this - it is about .5% of my income, it is a 5 minute jog from my apartment, and I go at least 5 times per week. Especially with how I am going to be cutting out other hobbies, I think the $19 is well worth keeping my sanity while going through this)
Dancing: $60-200 (I love partner dancing. It is a recently discovered passion of mine. On Wednesday's, I get 2 hours of lessons + 2 hours of social dancing, all for 10 bucks. This really fills up my social needs, so I am conflicted. It is a decent drive away. The up to $200 is if I'm including 1 or 2 private lessons a month. I know these have to go).
This leaves around $400 or so extra, which doesn't have a specific place, because I don't have a budget. This may have gone to increased gas during the holidays, medical expenses, random trips out of town. Really depends on what month I look at.
Expected ER expenses: none. Except maybe if I start riding my bike everywhere. :)
Assets:
2001 Chevy Tahoe - 198,000 miles
Current Savings - $8300
Checking account - $670
EDIT: 401k - $11,354
Liabilities:
$100,000 in student debt. One under my parents name, 3 under my name. Rates range between 5-9%.
So, here is where things get somewhat interesting. A lot of what I just posted will become irrelevant come July. This is because my parents have graciously offered to allow me to move back in with them when my lease is up. Since they live in the Austin, TX area, I will be looking for a new job. This is advantageous to me for a number of reasons. For one, I really do not like my current job or the industry I am in. By drastically reducing my expenses, I could take a moderate pay cut and still come out ahead. This way, I could land a job that perhaps doesn't pay quite as well, but that I am much more satisfied in. I think this is important, as right now the things that keep me from going insane about my current job are the things I am spending money on, like dancing, climbing, etc. If I have to cut this out, I would prefer to have some work that I can tolerate better than what I have now.
On top of that, I will definitely be looking for a 2nd (if not a 3rd) source of income. My plan is to really start bulldozing this debt once I move back with my parents. I want to get my expenses down to the point of essentially groceries, and whatever transportation I need for my streams of income.
Something else I have been thinking about, is my car situation. I know I shouldn't be thinking about spending 6-8k on a new car, but would it be worth trading in my tahoe to get something MUCH more fuel efficient, and reliable? And then not have to worry about getting a car for another decade or so? The maintenance has really started to hinder me - Just last month I paid $900 to fix a few different issues, and I left off a few others the mechanic said weren't as critical. This has started to become routine the last few years. I can't help but think I would make up savings pretty quickly on gas and maintenance if I found an affordable 6 or 7 year old prius or something along those lines. Of course, I suppose the real goal is to stop driving so much, so feel free to call me out on my terrible thought process here.
Overall, I know I have a pretty big challenge ahead of me, but I honestly feel good about it right now. This is partly because this debt has been hanging over my head for years now, and for the first time I actually feel like it is something I could potentially be done with in a few years time if I play my cards right, and that excites me. I am confident in my mindset and discipline, now I just need a good plan of action and to execute it.
I think that covers most everything. Feel free to leave criticism/advice of any sort, no matter how harsh. I am sure I need to hear it.