Teacher In Expensive City-- What Am I Missing?
Life Situation: I am a late twenties teacher living in the very expensive greater Boston area. In addition to teaching, I do a bit of tutoring each week and have just started doing freelance curriculum design. I also teach summer school, run a few clubs and tutor.
Gross Salary/Wages: Gross: $57,000 +5000 from extra responsibilities. After all the deductions (health care, dental, pension, state and federal taxes, and union dues) my net income is $3,100. If I stay working in this state I will earn in the 90,000’s in ten years (but no potential for higher).
Current expenses:
Rent: 712 (cheapest we could find near my work)
Utilities: 60
Food: 350 (I know… NOT GOOD)
Pharmacy: 30
Bus Pass: 75 (I don’t have a car)
Medical: 120 (this is as cheap as I can get this #)
Student Loan, Federal: $600 (minimum payment is $330, interest is 6%)
Netflix & Amazon Prime: $16 (Prime pays for itself in what I save on ordering supplements)
Beauty: $30
Misc: $100 (I include any clothing, movies, and restaurants in this #)
TOTAL: 2,100
Assets:
Emergency: 2500
Travel: 1000 (family lives on other coast)
Roth: 3000
403(b): 800 (Just raised contribution)
-I'm currently putting 1000 per month towards savings and retirement
Liabilities:
Federal Loan: 29000 left (In 3 years, 5,000 will be forgiven for my teaching service… I’m trying to time the payments so that I am paid off after this point, but if I pay off any earlier I won’t get this 5,000 benefit)
Specific Question(s):
I feel that I already adhere to many of the MMM principles. I even started cutting my own hair! So my problem is I am still not saving very much each month.
I feel there are a few barriers to my saving:
1)I live in a very expensive area. However, if I moved to a cheaper area I would need to buy a car and I don’t have the cash for that. Plus, I don’t want the added expenses. ALSO, I make over 10,000 more a year in this area that I would teaching anywhere else in the country. I am in one of the highest paying school districts in the country. I'm open to moving, but I’m not sure a move would be worth a huge pay cut.
2)I have food intolerances to some common cheap foods
3)Student loan debt. In 3 years I will qualify for 5,000 in teacher loan forgiveness. I am trying to decide if it is better to pay off my loans with everything I’ve got (this will take me at least 3 years, best case scenario) or if I should be balancing that with increasing my retirement investments or saving for a house.
Ok, let me have it! Please, poke holes in all this!