Hello my fellow Mustachians,
Background Info:
I just recently found MMM have been very inspired on my journey to FI. I recently just graduated and this upcoming September I'll be starting a new job with a $53k starting salary. I live in Santa Clara (Silicon Valley), CA. The cost of living here as some of you would know is way to high. I rent out a three bedroom house with two other roommates. That is why below I have utilities being shared and the expense listed here are my share of the utilities. I'm currently working as a intern right now but I'm moving onto a FT position this September.
I commute to work (25mi one way) and I roughly fill up once a week. I understand gas is a major consumption of my expenses but public transportation would equal in terms of cost and be more time consuming.
I'm an avid traveler and a big miles/points collector, that is why I budgeted a $250/mo savings for my guilt-free traveling excursions into a high yield savings account. This savings will help pay for any travel or food expenses that will occur during a trip.
All of my expenses are actually paid through credit cards so you may notice I have big debts on my high interest rate cards but I pay these off completely on a monthly basis. The one with a 0% interest rate I only pay minimum payment and use any leftover surplus money towards paying off my student loan.
Here is a breakdown of my monthly income and expenses.
Income
$53,000/year salary = $4,417/mo before tax
Monthly Expense
$870 rent
$60 cellphone
$150 groceries/toiletries (Shared expense with 2 other roommates, this is my share)
$20 electricity (my share)
$45 water (my share)
$15 garbage (my share)
$7 gas, pge (my share)
$37 cable & internet (my share)
$67 car insurance
$225 gas
$250 Guilt-Free Travel Savings
$85 High Deductible Health Plan
$25 CC payment to 0% interest card
Total = ~$1,860
Investment Vehicles
$1,300 High Yield Savings (.85%)
$6,800 401k (Traditional)
Debt
$2,980 Student loan (4.25%)
$2,200 Chase Freedom Credit Card (0% until May 2014)
Conclusion
4,417 Gross Income
(441) 10% pre-tax 401k
$3,976 income before tax
(994) 25% effective tax rate
$2,982 monthly income
(1,860) monthly expenses
$1,122 Remaining
I'm currently putting away 10% pretax income into a 401k account, should I only contribute the minimum of eligible matching with my company and use any extra funds towards my student loan? After I pay off my student loan, i'm going to save at least 40% of my income by maxing out my 401k and HSA. This will definitely help me drop into the lower 15% tax bracket, further boosting my saving potential.
Any advice towards my budget or strategy is greatly appreciated. Thanks in advance!