Appreciate any insights:
Life Situation: Married with one kid (and another due shortly), live in South Carolina. Kids are 2 and nearly born. Wife is in mid-20s, I’m in early 30s.
Salary: Spouse makes 26k – she teaches and does gigs on the side. Gigs go from 2500 to 7000 per year, though never guaranteed
My salary: extremely varied. I teach as an adjunct, on demand at universities. Never any guarantee of courses. This semester I am working 35 hrs/ and making 24k for the semester. Last semester I worked 8 hours and make 5k. Summers are unknown, as is long term.
My retirement: $6250 in Roth, $4000 in Traditional IRA, 401k with 3500.
Wifes retirement: 403b with $4000.
Investment account with $2000.
Cash on hand $25,000
Own 2 cars – 2003 Civic and 2004 Crv.
We bought our home for 120k with 3% down, and currently owe 113k. Interest is 3.625%. Payments are 531$ PI, 177$ TI, 73$ PMI. We could probably sell it for $140k-150k today – though its somewhat hard to say as our neighborhood has a lot of houses in the process of being flipped, so prices could really change this spring.
My wife has 9k of student loans. We pay $200 a month, the interest is between 4% and 5% (she has 7 different small loans). No idea what the minimum payment would be, I think somewhere around $120/m
Total assets: 167,750 (assuming house valued at purchase price)
Total liabilities: 122,000
Our budget:
House Payment: $780
Gas/Electric: $210
Netflix: $15 (we share with family, they write a check once a year for $100, so its really less, but this is the bill I pay)
Cell phones: $40 Project Fi two users (though my phone is a 5x that has been warranty replaced twice)
Internet: $45
Gas: $122 - I know this is crazy high. My wife has two jobs, one 4 miles north of us, one 5 miles south of us. Plus she drives for gigs. I currently drive 20 miles west to one of my jobs, and 5 miles west to the other.
Eating out: $100
Auto Insurance: $53
Auto maintenance: $100
Pest Control: 35$
Food: $250
Clothes: $50
Healthcare: $100
Water: $25
Sewer: $25
Childcare: $200
Health Insurance:**** My Wifes is $4500/yr pre-tax. Currently I get mine through work, at $10/month (its high deductible, and employer subsidized), however this is reliant on my state employer continuing to desire to employ me at least 30 hours a week, which I don’t anticipate happening after may, or in another term in the near future. Our kids are eligible for free health care through the state.
Total bills $2535
A note – for the last two years we have used traditional IRA contributions to lower our AGI to 37k so we would hit the maximum of the savers tax credit (the .5 bracket of savers maxed out is more credit than our taxes, but the .3 bracket doesn’t hit the total). If not for that, we would be using Roth IRA for all our contributions, as after credits we have not had any taxes due after having our first child.
Note on budget: my budget was retroactive, so things like cleaning supplies and personal care (which we purchased at grocery stores), all went on the grocery bill.
I am looking to make a small/big change in my life. While my work currently pays reasonably well, the lack of stability between semesters is a killer. So I am trying to start a educational/financial coaching business to provide another revenue stream and potentially build up into something full-time so that I can make teaching my side-hustle. For this I want to make sure I am doing the best to cut unnecessary expenses and optimize our budget before we plow money into this venture (even though the money is going to be fairly small).
The second thing I am wondering about is our house. I would love to make a large payment on the house of $17,000 to get out of PMI land, but I am somewhat uncomfortable doing this as A) my work is not stable, B) My wifes jobs pay very modestly, definitely below our living expenses C) that would wipe out most of our cash on hand (and unless I am offered summer courses I won’t get paid between May 15 and Aug 31). However, especially if I do this, I am fairly certain I won’t be willing to invest in my business, as the prospect of being out of money would scare me too much. Finally, I am not sure about if its wise to plow more money into the house as we are considering moving (we aren't from here and I am looking for jobs professionally in DC or semi-professionally in CO (both HCOL areas though, which limits options). If any of the job prospects turn out, we would presumably sell our property.
Curious about any thoughts.
