Author Topic: Case Study from NYC-What can I do better to speed up ER/FI?  (Read 7916 times)

1HWWNYC

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Case Study from NYC-What can I do better to speed up ER/FI?
« on: January 17, 2015, 03:18:47 PM »
Hey all,

I'm new to the forums but have been reading all the MMM blog posts on a weekly basis.
I enjoyed all the posts on cutting costs on every day purchases/expenses but I would like to know what I could do better to put myself in a position to
have more capital for investment purposes.

Goal: retire/FI by 45 y/o

Background information:
28 y/o
State of residence: Borough of queens in new york city

occupation: home care physical therapist-expected to see 5 patients a day at their homes-25pts/week->25 pts will get a bonus per patient seen
therefore I have to drive all over borough of brooklyn-I drive an hour back/forth everyday in order to get to patients houses and know this is wasting my time/money (see housing below)

Car: used 2012 hyundai elantra-30 bucks/week for gas. my job compensates 57.5 cents/mile driven so that covers gas money
took out a 10k loan for 3.99% interest for 6 years
156.41/month

salary: started 12/2014-80k with 2400 401k contributed from employee without a need for me to put anything in

housing: lives with parents for now so $0 but will be moving out with partner in April/May2015-i'll be paying 1k/month for rent for 6 months (her family will help cover rest) then after 6 months i'm expecting to cover full rent amount until gf gets a job and can contribute. she will graduate in May and look for job in Manhattan asap.
GF will be responsible for all utilities and food expenses
We are looking to rent primarily in brooklyn where I work so I can be closer to my patients and possibly pick up extra patients for higher pay per visit.
GF wants to be 30 min away from middle of Manhattan so we are limited in terms of rent prices/areas we can live at

Savings:
cash in checking/savings: 11,900

Investments:
Roth IRA: 8,200
already contributed 1375 this year
maxed out year 2014 when I started and going to max out this year as well

Monthly contributions:
School Loans-250 (no interest due to family gave me a loan :)
Cell- 30
Roth IRA-375 for next 11 months

Car insurance is 900 for 6 months which I paid in full already and good until July

Right now my plan is to live frugally and build up capital so I can get into real estate investing-REI
I want to invest in buy and hold properties out of state to get cash flow every month-my friend has a team/properties
in several states and all i need now is capital for conventional financing.

My strategy is max out my ROTH every year and save up capital and cash flow from my properties so i can buy more
properties and collect more cash flow. My tenants rent will cover all mortgages and expenses. For times of vacancy i have a above average income that can weather the storm.

Sorry for the long detailed report but I feel the more information given the more of a picture the reader can see of my situation.

My goal is to be FI/retire by 45 y/o (17 years)
I would say my average monthly expenses living at home is 600 but all that will change when me and my gf move in.
« Last Edit: January 17, 2015, 04:32:39 PM by 1HWWNYC »

Gin1984

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Re: What can I do better to speed up ER/FI?
« Reply #1 on: January 17, 2015, 03:22:57 PM »
You need to max out your 401k before you worry about a Roth.

Dan_at_Home

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Re: What can I do better to speed up ER/FI?
« Reply #2 on: January 17, 2015, 03:33:17 PM »
If look at MMM's post called the simple math behind early retirement, the answer to your question is simple, the less of your take home pay you can live on, the faster you will reach FI.  Speed to FI depends only on your savings rate, not your income.  Thus, to increase the speed to FI, focus on how to live even cheaper than you are now and save that extra money, it is as simple as that.


surfhb

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Re: What can I do better to speed up ER/FI?
« Reply #3 on: January 17, 2015, 03:33:29 PM »
The loose rule of thump is your yearly expenses x 25.........Calculate that to get your answer.

Once you know how much your life will cost, you can go about determining how much to need to save to get to your end destination :)

Workinghard

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Re: What can I do better to speed up ER/FI?
« Reply #4 on: January 17, 2015, 03:37:09 PM »
Max out 401k, then Roth, then contribute to a taxable account, and pick up more patients! 25 a week is light! You do map out your route, don't you? I see my first patient, the one furthest away, at 8-8:30, thus driving when it's too early (for most patients) to be seen. Your gas mileage rate and bonus are great! Most places will also pay higher weekend rates.

1HWWNYC

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Re: What can I do better to speed up ER/FI?
« Reply #5 on: January 17, 2015, 03:43:12 PM »
Forgot to add that I have a 10k car loan with 3.99% interest rate in which I pay 156.41/month
750 credit score

Frankies Girl

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Re: What can I do better to speed up ER/FI?
« Reply #6 on: January 17, 2015, 03:58:53 PM »
I'd say one of the things to delay is moving out of your parents and in with a girlfriend that has no job or income and is relying on her family to pay for her living expenses. You say she graduates in May, so that's only 4 months away - why do you think she won't find a job within a month after graduating?

Wait to move in together until after she graduates and has a job. You don't know where she'll end up employed, so it makes more sense anyway so you can really find the best place that works with both or your jobs.

Waiting also gives you more time to work on upping your 401K rate, paying off the car and saving up for when you do move.

You make 80K+  don't pay rent and only have 11K in savings?? Where is the rest of your money? With that sort of salary, you should have big bucks in the bank and not be carrying a car loan...You might want to look at how to do a case study so you'd get more help in targeting the areas you're overspending.


marty998

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Re: What can I do better to speed up ER/FI?
« Reply #7 on: January 17, 2015, 04:04:58 PM »
If look at MMM's post called the simple math behind early retirement, the answer to your question is simple, the less of your take home pay you can live on, the faster you will reach FI.  Speed to FI depends only on your savings rate, not your income.  Thus, to increase the speed to FI, focus on how to live even cheaper than you are now and save that extra money, it is as simple as that.

Can we please stop saying this.

Plainly obvious that saving rate is also dependant on income and that increasing income will increase savings rate too.

I'd say one of the things to delay is moving out of your parents and in with a girlfriend that has no job or income and is relying on her family to pay for her living expenses. You say she graduates in May, so that's only 4 months away - why do you think she won't find a job within a month after graduating?

Wait to move in together until after she graduates and has a job. You don't know where she'll end up employed, so it makes more sense anyway so you can really find the best place that works with both or your jobs.

Waiting also gives you more time to work on upping your 401K rate, paying off the car and saving up for when you do move.

You make 80K+  don't pay rent and only have 11K in savings?? Where is the rest of your money? With that sort of salary, you should have big bucks in the bank and not be carrying a car loan...You might want to look at how to do a case study so you'd get more help in targeting the areas you're overspending.


Yes +1, wait for the GF to get a job, then figure out a place to live that works for both of you.

1HWWNYC

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Re: What can I do better to speed up ER/FI?
« Reply #8 on: January 17, 2015, 04:29:33 PM »
If look at MMM's post called the simple math behind early retirement, the answer to your question is simple, the less of your take home pay you can live on, the faster you will reach FI.  Speed to FI depends only on your savings rate, not your income.  Thus, to increase the speed to FI, focus on how to live even cheaper than you are now and save that extra money, it is as simple as that.

Can we please stop saying this.

Plainly obvious that saving rate is also dependant on income and that increasing income will increase savings rate too.

I'd say one of the things to delay is moving out of your parents and in with a girlfriend that has no job or income and is relying on her family to pay for her living expenses. You say she graduates in May, so that's only 4 months away - why do you think she won't find a job within a month after graduating?

Wait to move in together until after she graduates and has a job. You don't know where she'll end up employed, so it makes more sense anyway so you can really find the best place that works with both or your jobs.

Waiting also gives you more time to work on upping your 401K rate, paying off the car and saving up for when you do move.

You make 80K+  don't pay rent and only have 11K in savings?? Where is the rest of your money? With that sort of salary, you should have big bucks in the bank and not be carrying a car loan...You might want to look at how to do a case study so you'd get more help in targeting the areas you're overspending.


Yes +1, wait for the GF to get a job, then figure out a place to live that works for both of you.

The gf is from out of state so after she graduates she needs a place to stay otherwise she is going back to out of state which I'm not going to let happen because I dont believe in long distance relationships
She plans to work in manhattan as a bartender and audition in the daytime as she is in school for film/acting.
My rationale for living in brooklyn is that I have a stable job and will be able to increase my productivity by being closer to my patients and not having to drive 2 hours round trip every day.
She has a flat fee monthly of a unlimited metrocard regardless if we live 30 min away from where she works or 1 hour away. My gas fee changes dependent on how much i drive.
my school loans after grad school in 2013 was over 60k and I reduced it to less than 20k from then to now so thats where most of my cash went. my first year out i was making 35-40k and I got a huge boost in salary recently.
I took out a loan for the car because i didnt want to use up all my savings which I was planning to use as a emergency fund when i move out later this year.
3.99 interest rate is alot lower than the returns i made from my roth ira investments last year and I plan to exceed 3.99% roi every year so it only make sense that I take out that loan for the car.

why do all you guys advocate maxing out 401k before roth ira?
the money that I was going to put into the 401k im actually saving up as capital so I can start my REI. im going to use that to get a mortgage and get 15+% cash on cash return on average.
you show me a 401k portfolio that averages that much in ROI on a yearly basis-i never heard of it
in my eyes there is a greater risk by leveraging properties but i feel that with my income i'll be able to eat the loss when that time comes.

If waiting to move out with my gf was an option I would have done so but that is not the case so I have to deal with that hand as played out and cut costs somewhere else.

Thanks for all your inputs so far!
Keep on coming please!

marty998

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Re: Case Study from NYC-What can I do better to speed up ER/FI?
« Reply #9 on: January 17, 2015, 04:36:42 PM »
ahh, this is why you need to tell us everything so we can help you.... no one knew the girlfriend was moving from out of state.

And don't expect that 15% returns in real estate are a certainty year in year out forever ....if it were that easy everyone would be dong it.

Not trying to discourage, just asking you to go in without rose coloured glasses.

1HWWNYC

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Re: Case Study from NYC-What can I do better to speed up ER/FI?
« Reply #10 on: January 17, 2015, 04:40:01 PM »
Sorry but this thread was my 1st post but I promise the more I post the better i'll become :)

caliq

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Re: Case Study from NYC-What can I do better to speed up ER/FI?
« Reply #11 on: January 17, 2015, 04:45:55 PM »
Your car insurance seems pretty expensive...DH and I pay $535/6 months for coverage on 2 cars (comprehensive & collision on 1 newer car), and we're both under 30. 

Also, if I were in your situation, I would pay off the student loan and the car loan before thinking about investing in real estate.  Paying off family is never a bad thing, and getting rid of the car loan will reduce your monthly mandatory expenses in case of an emergency.
« Last Edit: January 17, 2015, 05:46:29 PM by caliq »

Workinghard

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Re: Case Study from NYC-What can I do better to speed up ER/FI?
« Reply #12 on: January 17, 2015, 05:10:49 PM »
Maxing out your 401k decreases your taxable income, thus the reason it's recommended.I'll let someone else show you the math, but you won't see the full drop in income since its pretax.


1HWWNYC

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Re: Case Study from NYC-What can I do better to speed up ER/FI?
« Reply #13 on: January 17, 2015, 06:39:52 PM »
Your car insurance seems pretty expensive...DH and I pay $535/6 months for coverage on 2 cars (comprehensive & collision on 1 newer car), and we're both under 30. 

Also, if I were in your situation, I would pay off the student loan and the car loan before thinking about investing in real estate.  Paying off family is never a bad thing, and getting rid of the car loan will reduce your monthly mandatory expenses in case of an emergency.

Why would I pay off a loan that is 0% interest for length of loan above what I discussed with my family member for the monthly payment. that is using up capital that I could use to make passive income.

caliq

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Re: Case Study from NYC-What can I do better to speed up ER/FI?
« Reply #14 on: January 17, 2015, 06:42:35 PM »
Your car insurance seems pretty expensive...DH and I pay $535/6 months for coverage on 2 cars (comprehensive & collision on 1 newer car), and we're both under 30. 

Also, if I were in your situation, I would pay off the student loan and the car loan before thinking about investing in real estate.  Paying off family is never a bad thing, and getting rid of the car loan will reduce your monthly mandatory expenses in case of an emergency.

Why would I pay off a loan that is 0% interest for length of loan above what I discussed with my family member for the monthly payment. that is using up capital that I could use to make passive income.

Because your family member was nice and generous enough to loan you money at 0% interest and you'd want to make 100% sure that you paid them back?

It doesn't make sense numbers-wise, it makes sense morals-wise.  You'd essentially be robbing them of whatever passive income they could make on the balance of your loan, while pocketing those gains yourself.

1HWWNYC

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Re: Case Study from NYC-What can I do better to speed up ER/FI?
« Reply #15 on: January 17, 2015, 06:48:07 PM »
If I could achieve at least a 10% ROI from real investing consistently then is there no point of me dumping extra money into my 3.99% car loan,  0% student loan, 401k. I would think so but
anybody think not please let me know your rationale.

Real estate would give me better returns and I also get tax deductions from depreciation and interest on mortgage paid by tenants as well.

1HWWNYC

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Re: Case Study from NYC-What can I do better to speed up ER/FI?
« Reply #16 on: January 17, 2015, 06:50:10 PM »
The monthly loan amount to my family member has been discussed so that they don't feel that I'm taking advantage and plus they offered without me asking. I make a auto payment to them from my paycheck every month so they know that they will be paid in full

caliq

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Re: Case Study from NYC-What can I do better to speed up ER/FI?
« Reply #17 on: January 17, 2015, 06:55:08 PM »
Alright then, clearly you've made up your mind on that subject.

What about your car insurance?  I don't know about NYC insurance rates, so maybe that's why it's so high, but you're paying nearly double what I pay for full coverage on a 2010 Fusion.  That might be a painless way to lower expenses -- have you shopped around recently?

mozar

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Re: Case Study from NYC-What can I do better to speed up ER/FI?
« Reply #18 on: January 17, 2015, 07:44:00 PM »
I wouldn't worry about  the unlimited subway card. You can make far more money living in a location that is good for you than you she will get in savings with free subway. And you are already helping her out by living with her.

Dan_at_Home

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Re: What can I do better to speed up ER/FI?
« Reply #19 on: January 18, 2015, 06:51:25 PM »
If look at MMM's post called the simple math behind early retirement, the answer to your question is simple, the less of your take home pay you can live on, the faster you will reach FI.  Speed to FI depends only on your savings rate, not your income.  Thus, to increase the speed to FI, focus on how to live even cheaper than you are now and save that extra money, it is as simple as that.

Can we please stop saying this.

Plainly obvious that saving rate is also dependant on income and that increasing income will increase savings rate too.

I am not going to stop saying it because it is true.  As Frankies girl points out: You make 80K+  don't pay rent and only have 11K in savings??

The issue here is the lack of savings rate.  The 80K income per year is a good income, speed to FI is definitely increased by focusing on living cheaper.  For example, if one can find to cut living expenses by 10k a year, it is a double win because that is more money going to the stash and less money needed in FI to support the OPs lifestyle.  On the other hand, if the OP works their butt off by doing tons of overtime to reach 90K a year, then the result is that most of that extra is cash is taxed by the government (since they are in high tax bracket) and the amount to live off of in FI never decreases because the OP only learned how to increase the income rather than live cheaper. 

Thus, if you want achieve FI faster, obviously maxing out retirement contributions is good, but also take a hard look at where your money goes each month and start cutting down the amount you spend on every category.  Living cheap like MMM is a skill that is acquired over time, it takes time to change your habits.  Read MMM's post carefully and start implementing them one at a time in your life.
« Last Edit: January 18, 2015, 06:54:23 PM by Dan_at_Home »

morning owl

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Re: Case Study from NYC-What can I do better to speed up ER/FI?
« Reply #20 on: January 18, 2015, 07:08:48 PM »
He doesn't have much in savings because he just got the job a month ago. He didn't say what he was making before this job... Might have been much less.

RapmasterD

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Re: Case Study from NYC-What can I do better to speed up ER/FI?
« Reply #21 on: January 18, 2015, 09:13:41 PM »
Apologies in advance. I'm gonna be very rude. It's been a tough day. You can take it, with the Queens pedigree and all.

Q: Why are you rationalizing your stupid fucking 2+ year old car with the 4% car loan?

When I was your age living in Boston in 1990 I was driving a 12 year old, 100K+ mile Chevy rust heap with a red velour interior I needed to repeatedly staple to ensure the roof liner didn't fall down on me while I was driving. I reliably drove 60+ miles every day through Boston suburbia traffic to and from work. I also lived in a cockroach infested shit den for 10+ years where the heat regularly went out in the winter and college students regularly pissed in the back lot by my window on the weekends. Adjusted for inflation I was making less than you do now.

And now here I am decades later. Last year I saved and subsequently invested exponentially more than you make in a year. And I paid exponentially more in Federal taxes than you make in a year. And yet I drive a 14.5 year old car that we paid for in cash.

So again, what's with your car?

Here is why I'm freaking out about your car.

The car is symbolic.

Do you know what the sign of a great restaurant is? They can make a simple roast chicken taste like magic.

Do you know what the sign of someone who is serious about getting frugal is? They don't rationalize a car loan. Ever. Unless it's zero percent. Then they can get away with it. It is a loan, against a rapidly depreciating "asset."

People on this forum agonize about whether to pay off their home mortgages or not -- against typically appreciating assets.

Kill your car loan. And best of success to you and your S.O.

End of rant.

capital

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Re: Case Study from NYC-What can I do better to speed up ER/FI?
« Reply #22 on: January 18, 2015, 09:35:42 PM »
Car insurance is expensive in New York. But if you're driving all day and getting reimbursed by the mile, you should move to a super-low TCO car so you make money by driving— a Prius or a Fit. They're probably getting cheaper on the used market now that gas prices have crashed. Look toward biking when you aren't going too far if you don't need much equipment— then that .50 a mile would really pile up. It's not like you travel that much faster by driving on city streets in Brooklyn.

If you want to move to close-in Brooklyn, you should probably move to Ridgewood before it gets too expensive. Or Midwood/Flatbush/Ditmas Park near the B train. But there aren't many places that are still reasonable in Brooklyn half an hour from Manhattan. Have you considered Sunnyside or anything? A lot of people in acting live in Queens, since more of the industry is in Midtown. And it's still close to Brooklyn, but cheaper.
http://www.padmapper.com/show.php?source=1&id=202567083&src=main
And get on as many Mitchell-Lama waiting lists as you can while your income is low-ish.

capital

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Re: Case Study from NYC-What can I do better to speed up ER/FI?
« Reply #23 on: January 18, 2015, 09:36:55 PM »
Car insurance is expensive in New York. But if you're driving all day and getting reimbursed by the mile, you should move to a super-low TCO car so you make money by driving— an older Prius or a Fit. They're probably getting cheaper on the used market now that gas prices have crashed. Look toward biking when you aren't going too far if you don't need much equipment— then that .50 a mile would really pile up. It's not like you travel that much faster by driving on city streets in Brooklyn.

If you want to move to close-in Brooklyn, you should probably move to Ridgewood before it gets too expensive. Or Midwood/Flatbush/Ditmas Park near the B train. But there aren't many places that are still reasonable in Brooklyn half an hour from Manhattan. Have you considered Sunnyside or anything? A lot of people in acting live in Queens, since more of the industry is in Midtown. And it's still close to Brooklyn, but cheaper.
http://www.padmapper.com/show.php?source=1&id=202567083&src=main
And get on as many Mitchell-Lama waiting lists as you can while your income is low-ish.

roadtofreedom

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Re: Case Study from NYC-What can I do better to speed up ER/FI?
« Reply #24 on: January 19, 2015, 12:57:19 AM »
Long way ahead.

Good luck and remain mustachian. The trick is cutting off the expenses as much as possible.

coffeehound

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Re: Case Study from NYC-What can I do better to speed up ER/FI?
« Reply #25 on: January 19, 2015, 01:06:26 AM »
If I could achieve at least a 10% ROI from real investing consistently then is there no point of me dumping extra money into my 3.99% car loan,  0% student loan, 401k. I would think so but
anybody think not please let me know your rationale.

Real estate would give me better returns and I also get tax deductions from depreciation and interest on mortgage paid by tenants as well.

There is no guarantee you'll get ANY ROI from investing in real estate.  None.    However, you will get a 3.99% return on your net worth by getting rid of that car loan - with the added bonus of freeing up the money you're sending the nice auto loan people every month.

As for your "0%" loan from your relative that you don't want to pay off because you can "use that money to generate passive income?" Uh, yeah.  That is a dick maneuver, plain and simple.  PAY OFF YOUR DEBTS BEFORE YOU START INVESTING.

Yes, I mean to shout at you, because behaving this way is un-Mustachian and a shitty way to treat people.

coffeehound

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Re: Case Study from NYC-What can I do better to speed up ER/FI?
« Reply #26 on: January 19, 2015, 01:10:07 AM »
If I could achieve at least a 10% ROI from real investing consistently then is there no point of me dumping extra money into my 3.99% car loan,  0% student loan, 401k. I would think so but
anybody think not please let me know your rationale.

Real estate would give me better returns and I also get tax deductions from depreciation and interest on mortgage paid by tenants as well.

There is no guarantee you'll get ANY ROI from investing in real estate.  None.    However, you will get a 3.99% return on your net worth by getting rid of that car loan - with the added bonus of freeing up the money you're sending the nice auto loan people every month.

As for your "0%" loan from your relative that you don't want to pay off because you can "use that money to generate passive income?" Uh, yeah.  That is a dick maneuver, plain and simple.  PAY OFF YOUR DEBTS BEFORE YOU START INVESTING.

Yes, I mean to shout at you, because behaving this way is un-Mustachian and profiting from a relative's generosity is a shitty way to treat people, regardless of how many times this person has "said it's fine," and "they'll know I'll pay it back."

1HWWNYC

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Re: Case Study from NYC-What can I do better to speed up ER/FI?
« Reply #27 on: January 19, 2015, 05:44:42 AM »
Apologies in advance. I'm gonna be very rude. It's been a tough day. You can take it, with the Queens pedigree and all.

Q: Why are you rationalizing your stupid fucking 2+ year old car with the 4% car loan?

When I was your age living in Boston in 1990 I was driving a 12 year old, 100K+ mile Chevy rust heap with a red velour interior I needed to repeatedly staple to ensure the roof liner didn't fall down on me while I was driving. I reliably drove 60+ miles every day through Boston suburbia traffic to and from work. I also lived in a cockroach infested shit den for 10+ years where the heat regularly went out in the winter and college students regularly pissed in the back lot by my window on the weekends. Adjusted for inflation I was making less than you do now.

And now here I am decades later. Last year I saved and subsequently invested exponentially more than you make in a year. And I paid exponentially more in Federal taxes than you make in a year. And yet I drive a 14.5 year old car that we paid for in cash.

So again, what's with your car?

Here is why I'm freaking out about your car.

The car is symbolic.

Do you know what the sign of a great restaurant is? They can make a simple roast chicken taste like magic.

Do you know what the sign of someone who is serious about getting frugal is? They don't rationalize a car loan. Ever. Unless it's zero percent. Then they can get away with it. It is a loan, against a rapidly depreciating "asset."

People on this forum agonize about whether to pay off their home mortgages or not -- against typically appreciating assets.

Kill your car loan. And best of success to you and your S.O.

End of rant.

Just cause you lived a certain way does not mean I want to as well because you werent living mustachian way back in the day you were living in poverty and that is not what im trying to do to achieve FI.
The reason why I took out a loan for the 10k for the car is because if I bought it in cash then I would of had NO savings in the bank and no money living expenses. Would of had to borrow money regardless to cover those expenses.  I would of had to borrow for daily expenses!! Plus on the flip side with my high income the car loan will be paid off asap as my paychecks come in and that is the priority.

1HWWNYC

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Re: Case Study from NYC-What can I do better to speed up ER/FI?
« Reply #28 on: January 19, 2015, 05:47:51 AM »
He doesn't have much in savings because he just got the job a month ago. He didn't say what he was making before this job... Might have been much less.

I apologize for leaving out my prior income. Before this job for the last 1.5 year I was pulling in 40k and I reduced my student loans from 80k to 20k in that time frame so there was all the savings.
 I got the 80k job in Dec 2014 and the 20k now is a 0% loan from a relative as mentioned and im paying on a monthly basis.

1HWWNYC

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Re: Case Study from NYC-What can I do better to speed up ER/FI?
« Reply #29 on: January 19, 2015, 05:51:09 AM »
Car insurance is expensive in New York. But if you're driving all day and getting reimbursed by the mile, you should move to a super-low TCO car so you make money by driving— a Prius or a Fit. They're probably getting cheaper on the used market now that gas prices have crashed. Look toward biking when you aren't going too far if you don't need much equipment— then that .50 a mile would really pile up. It's not like you travel that much faster by driving on city streets in Brooklyn.

If you want to move to close-in Brooklyn, you should probably move to Ridgewood before it gets too expensive. Or Midwood/Flatbush/Ditmas Park near the B train. But there aren't many places that are still reasonable in Brooklyn half an hour from Manhattan. Have you considered Sunnyside or anything? A lot of people in acting live in Queens, since more of the industry is in Midtown. And it's still close to Brooklyn, but cheaper.
http://www.padmapper.com/show.php?source=1&id=202567083&src=main
And get on as many Mitchell-Lama waiting lists as you can while your income is low-ish.

Thanks for the tip about areas to look into. I get 57.5 cents/mile so I actually make a profit every week from reimbursement and that is including the miles used when commuting to /from first and last patient which im not claiming (cant claim and was told my boss)

1HWWNYC

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Re: Case Study from NYC-What can I do better to speed up ER/FI?
« Reply #30 on: January 19, 2015, 05:55:24 AM »
If I could achieve at least a 10% ROI from real investing consistently then is there no point of me dumping extra money into my 3.99% car loan,  0% student loan, 401k. I would think so but
anybody think not please let me know your rationale.

Real estate would give me better returns and I also get tax deductions from depreciation and interest on mortgage paid by tenants as well.

There is no guarantee you'll get ANY ROI from investing in real estate.  None.    However, you will get a 3.99% return on your net worth by getting rid of that car loan - with the added bonus of freeing up the money you're sending the nice auto loan people every month.

As for your "0%" loan from your relative that you don't want to pay off because you can "use that money to generate passive income?" Uh, yeah.  That is a dick maneuver, plain and simple.  PAY OFF YOUR DEBTS BEFORE YOU START INVESTING.

Yes, I mean to shout at you, because behaving this way is un-Mustachian and a shitty way to treat people.

The loan details that me and my relative discussed are in agreement in both parties so whether I pay it off early or in time is not a "dick" move IMO. i'm not planning to be late on any payments and dont intend to. A "dick" move would be to not pay them and use that money for investment not what I 'm doing but then again thats my opinion.

There's no guarantee with ANY investing and I understand that risk if I should partake in REI to use cash flow to speed up my debt payoffs

ShoulderThingThatGoesUp

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Re: Case Study from NYC-What can I do better to speed up ER/FI?
« Reply #31 on: January 19, 2015, 05:57:00 AM »
The reason why I took out a loan for the 10k for the car is because if I bought it in cash then I would of had NO savings in the bank and no money living expenses. Would of had to borrow money regardless to cover those expenses.  I would of had to borrow for daily expenses!! Plus on the flip side with my high income the car loan will be paid off asap as my paychecks come in and that is the priority.

You're missing the point. You shouldn't have bought such an expensive car when you already had debt, and you shouldn't own it now.

1HWWNYC

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Re: Case Study from NYC-What can I do better to speed up ER/FI?
« Reply #32 on: January 19, 2015, 06:01:55 AM »
I bought the 2012 hyundai elantra for 15k of which 10k is a loan 3.99%.
car had 9500 miles on it and I intend to use it for 10+ years or sell for my purchased price in 2 years.

Distshore

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Re: Case Study from NYC-What can I do better to speed up ER/FI?
« Reply #33 on: January 19, 2015, 08:20:20 AM »
I live in the 5 boros area too and am also investing in out of state real estate.  Please be aware that your viewpoint seems to be a bit optimistic about just putting down the money and suddenly having a 15% cash  on cash return rolling in.  I have a lot more reserves and income than you and frankly, right now I'm glad I do because the first investment property (which took 1 year of looking to find something "decent", is so far sucking into those reserves.  It could take a year of ownership for it to break even (and I calculated a conservative 12% cash on cash return after all theoretical expenses)!  That's 20K down the drain after paying for the house + closing costs.  You MUST have that money available for EACH property. 

In the long run, I believe this will all pay off.  But your (and my) spreadsheets can't model the bumps in the road, only the averages.  Go for it, but listen to the advice that the other posters are giving you, because you seem to be ignoring some of the things that can and will go wrong, and that could screw you pretty badly and delay your FI plans.  Be careful, prudent, take care of the people who love you and don't gamble with their money: and good luck!

RapmasterD

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Re: Case Study from NYC-What can I do better to speed up ER/FI?
« Reply #34 on: January 19, 2015, 09:54:17 AM »

Apologies in advance. I'm gonna be very rude. It's been a tough day. You can take it, with the Queens pedigree and all.

Q: Why are you rationalizing your stupid fucking 2+ year old car with the 4% car loan?

When I was your age living in Boston in 1990 I was driving a 12 year old, 100K+ mile Chevy rust heap with a red velour interior I needed to repeatedly staple to ensure the roof liner didn't fall down on me while I was driving. I reliably drove 60+ miles every day through Boston suburbia traffic to and from work. I also lived in a cockroach infested shit den for 10+ years where the heat regularly went out in the winter and college students regularly pissed in the back lot by my window on the weekends. Adjusted for inflation I was making less than you do now.

And now here I am decades later. Last year I saved and subsequently invested exponentially more than you make in a year. And I paid exponentially more in Federal taxes than you make in a year. And yet I drive a 14.5 year old car that we paid for in cash.

So again, what's with your car?

Here is why I'm freaking out about your car.

The car is symbolic.

Do you know what the sign of a great restaurant is? They can make a simple roast chicken taste like magic.

Do you know what the sign of someone who is serious about getting frugal is? They don't rationalize a car loan. Ever. Unless it's zero percent. Then they can get away with it. It is a loan, against a rapidly depreciating "asset."

People on this forum agonize about whether to pay off their home mortgages or not -- against typically appreciating assets.

Kill your car loan. And best of success to you and your S.O.

End of rant.

Just cause you lived a certain way does not mean I want to as well because you werent living mustachian way back in the day you were living in poverty and that is not what im trying to do to achieve FI.
The reason why I took out a loan for the 10k for the car is because if I bought it in cash then I would of had NO savings in the bank and no money living expenses. Would of had to borrow money regardless to cover those expenses.  I would of had to borrow for daily expenses!! Plus on the flip side with my high income the car loan will be paid off asap as my paychecks come in and that is the priority.

So basically you're getting feedback from multiple people and not taking it. BTW, I wasn't living in poverty. What a joke. Last time I checked, Brighton Mass is less ghetto than Queens. But I did have more saved up than you...NOT adjusted for inflation. I was living well within my means. Trust me when I tell you that you are in no position to determine what is MMM or not. You are defending a 0 percent loan and 4 percent car payments.