Author Topic: New to this forum  (Read 3187 times)

mm36

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New to this forum
« on: June 23, 2013, 06:05:28 PM »
Hello, my name is Matt.  I am 36 years old and totally new to this forum.  I'm from Colorado Springs, Colorado.  I work full-time as a librarian at a college.  It's been just a few years that I have taken an interest in personal finance. In fact, it wasn't too long ago that I started an emergency fund and not too long before that I didn't even know what an emergency fund was.  So, I have some questions. 

--I only have only 400 dollars in an emergency fund.  I don't have credit card debt, but a ton of student loan debt ($70,400.00 roughly).  I'm on the income based repayment plan where I pay about 100 dollars a month toward the loan.  I would really love to get out of debt early, say in ten years or maybe even less than that.  At the same time, this would cut back on my ability to build up the EF.  What should I do first?  Put extra toward the student loan or build up the EF?

--I would also like to be a full-time freelancer eventually, but I'm not sure if that kind of lifestyle would be suitable for me.  I don't know if I could deal with the uncertainty of not having a regular paycheck.  Does anyone recommend being a freelancer?  What are the pros and cons of it?

Thanks.

aj_yooper

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Re: New to this forum
« Reply #1 on: June 23, 2013, 07:45:08 PM »
Welcome to the forum and congratulations on your interest in personal finance!  Good job on no credit card debt.  In terms of your personal finances, I think you should definitely build up your emergency fund to multiples of your monthly expenses, but that means you need to track how you have been spending your income for the past few months, or maybe you have already.  Some people here use Mint.com for that purpose, but you can also do it old school and go through your credit card bills and checking account or use a spread sheet.  I like how Bogleheads goes through personal finance concepts (http://www.bogleheads.org/wiki/Bogleheads®_personal_finance_planning_start-up_kit), but you can definitely learn a lot here by reading some of the budget threads or MMM's case studies.  It also sounds like you might need  to flex your frugality muscles more.  Are you able to have some of your student loans forgiven, as you are working in a college?  Your idea of freelancing could be a nice source of extra income or a career path, but it sounds like you are more thinking about it than researching it or exploring possibilities.  So what are your longer term goals? 

mm36

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Re: New to this forum
« Reply #2 on: June 23, 2013, 08:15:29 PM »
Thanks for the reply.  No, unfortunately I don't work in a public school, so I can't have my loan balance forgiven.  My longest term goal is to be financially independent, so I can quit working if I so choose.  Thanks for the advice.

arebelspy

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Re: New to this forum
« Reply #3 on: June 23, 2013, 10:53:51 PM »
Welcome Matt!

The emergency fund depends on your financial situation - do you have a family to support, is your job stable (or might buget cuts give you the axe), how much suplus cash flow do you have every month (e.g. if you save $1000/mo, any "emergency" that costs less than that, say a $400 car repair, can be paid out of cash flow, and doesn't need to come from an emergency fund), etc.  Ultimately there's no hard and fast "rule" - you'll have to decide with what you're comfortable with.

Depending on the student loan rates you'll want to look at aggressively paying them down, or paying the minimum and investing.

Regarding the freelancing thing - it depends on what you're looking to do.  Freelance librarian is a new one on me.  ;)

It may be best to start it as a part time gig, see what sort of revenue you can generate and decide if it's something you want to pursue full time.

Best of luck; glad to have you here!
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Rebecca Stapler

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Re: New to this forum
« Reply #4 on: June 25, 2013, 10:58:08 AM »
Thanks for the reply.  No, unfortunately I don't work in a public school, so I can't have my loan balance forgiven.  My longest term goal is to be financially independent, so I can quit working if I so choose.  Thanks for the advice.

Just to make sure that you understand the distinction -- public schools are one type of employer that would qualify you for forgiveness. If the college where you work is a non-profit, you can still get the loans forgiven through the PSLF program. If it's a for-profit school (like ITT Tech or Univ of Phoenix), then you don't qualify.

mm36

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Re: New to this forum
« Reply #5 on: June 27, 2013, 09:39:35 PM »
It is a for-profit school, so I won't qualify.