Hello!
Life Situation: Fiance (husband in three weeks!) and I are 20. I am working full time as a web application developer, he is going to college full time for engineering. We are both fairly cautious with our spending, but I don't know if I would say we are exceptionally frugal or money wise. We live in a very low cost of living area. I believe it's at something like 85 where the US national average is 100.
Both of us came from incredibly large families. I came from a family of 10, while he came from a family of 12. I think it makes a big difference in what we perceive as splurges and whatnot. Neither of us went out to eat much as kids or went on extravagant family vacations so we never really developed an expectation of them or a big desire to do those sorts of things. Neither of us came from what I would consider poor families (my dad makes 100k+, his dad around 80k), but it did probably result in a different financial upbringing for us compared to most kids.
Our main goal is to have saved 40,000 dollars at the very least by the time he graduates in May of 2018. I am very into the idea of early retirement, but I don't really have a projected retirement age for us. My hope would be that we could be taking a back seat in regards to working time maybe around age 35 or even 30? I don't know that either of us have the desire to totally stop working by then, but we would like to have a laid back work life past that age so that we can spend that more of that time together and with our kids if we have them. I would like to devote my minimal working time to hobby programming or the occasional website design, or even giving music lessons. He would like to just have a lesser working schedule.
I am drastically underpaid right now, mostly because I was taken on in a sort of learn while you work situation. I decided to drop out of college right after we had talked about getting married because we didn't think it was very financially responsible for us to both be accumulating debt while trying to start our married lives together. I have been told I will be getting a large raise at the end of the year (knock on wood) that I would expect to at least put me above 50,000 in yearly pay.
My fiance and I went to highschool together and both really enjoyed programming. We did lots of programming competitions together and spent lots of time developing our skills. If I do not get a large enough raise, my fiance and I have plans to really work on getting more freelance website design or programming work and potentially have me become self employed full time.
Gross Salary/Wages: I am projected to make 37,300 for the year of 2015
Pre-tax deductions: I just became eligible to enroll in my company's 401k program; however, changes only activate once every quarter so I have to wait until January to actually start putting money in. I will for sure be putting in 4% as that is what my employer matches to, but would like to put more in.
Other Ordinary Income: I just started doing freelance web design or small programming tasks a few months ago for people who ask me to - mainly family and church members, as well as a few local businesses. I have added an extra 2,000 dollars of income through this. I also give violin lessons to a girl in my church who cannot afford to go to a professional music studio and made maybe like 350 dollars from that this year.
Adjusted Gross Income: 39,650.
Taxes: I am on schedule to pay 9,200 in taxes this year for my full time job. I have no clue if that's excessive or normal to be honest. I have never done my taxes before, I always let my parents take care of them for me. This is probably something I should go and educate myself on a little more. I have not done any taxes for the freelance work, however I will be paying taxes on that at the end of the year for sure so my tax amount will be higher than the 9,200 figure.
So, we are looking at a net income of 30,000.
Current expenses: (by month. Totals 1,800 )
Church offerings: 300
Rent: 600
Utilities: 150
Food and toiletries: 300; This is a figure I really don't have a clue on. Maybe you have tips on ways to save money on food. Our food cost is expected to go down now (not sure how much) as my fiance is a hunter and is friends with many other hunters who don't like to butcher/keep their meat. We have maybe 50 pounds of deer meat in our freezer right now and several pheasants. So our groceries consist of a lot of non-meat goods.
Internet: 35
Phone: 60
Gas: 150; We can't really cut down here. My fiance's school is 15 miles away by highway so biking there isn't really an option. I carpool 45 miles to work so biking isn't an option for me either, but that is irrelevant because the company pays for the gas and supplies the car.
Insurance: 100 (auto and renters) No clue if that's a good deal or not, maybe that can get chopped down.
Clothing: Don't budget for it. I love shopping at the local second hand stores (they run deals every season where you can fill a brown paper grocery bag with as much as you can fit for 25 cents; hard to beat that!) and really don't need any more clothing; neither does my fiance. If we do, it hardly costs us anything if we're willing to wait till the end of the season to get it.
Vacation: again, we don't really budget for it. My employer offers awesome vacation benefits. They own a condo on a nearby lake, and have season tickets to the Kansas City Royals and Chiefs. They allow employees to use both and will cover the costs of lodging if you go to one of the sports games. Makes for a fairly cheap vacation. They also have gifted vacation packages to tropical areas to employees. I don't think I can hope for one until I have been working here for longer, but it is definitely a possibility down the road.
Entertainment: Maybe 100 per month maximum? We like to go out to eat by ourselves maybe twice a month, with our friends once a month, and have our friends over quite often and make all the food for that. We split a Netflix subscription with a group of friends. A large chunk of our entertainment cost is in the gas to drive there. The nearest city is 100 miles away.
Assets: We don't really have much for assets, but here's a short list of everything that I can think of that holds value.
25,000 dollars in savings.
2 cars worth about 7,000 dollars total.
I enjoy playing musical instruments, I have maybe 1,700 dollars resale value between my piano, guitar, and violin
My fiance enjoys guns. He has maybe 3,500 dollars worth of guns.
Various household items totaling maybe 4,000 in value? We have pretty cheap furniture; we got a lot of it free / on neighborhood garage sales. Our only furniture of value is our mattress and bedroom set.
Liabilities:
School loans: at the end of this school year we will have 8,000 dollars in school loans. I have absolutely no clue on the interest rate, but I do know that about 6,000 of the loans are subsidized so that doesn't matter until he graduates.
Specific Question(s): Providing a detailed breakdown is important, so is asking for specific information so we know what kind of help/advice you are looking for.
Now, if our budgeting stays put we can make our goal of 40,000 dollars by summer 2018. I don't like that. I want to push that goal up. I don't think our goal should be that easily attainable. :) What do you realistically think could be a savings goal for us to shoot for by summer 2018 if we continue the way we're going?
How about if I get a 10,000 dollar raise? Or more?
Secondly, we want to invest, and we are willing to take on a lot of risk with a smaller amount of money, maybe 5,000 dollars. It makes me antsy having all our money sitting in a savings account losing value due to inflation. Do you have any recommendations for us? It would be nice to have a largeish chunk able to be pulled out in 3-5 years for if we would want to purchase a house. So maybe risky isn't the way to go. I would be very interested in owning a rental property. However, we would want to own one in the city 100 miles away so I don't really know how wise of a choice that would be right now. Any one with rental properties have any advice? Do we need more money before we jump into owning an investment property anyways?
Thirdly, do you have any advice for us in general? We're really starting from scratch here and this could be the start of us developing either good or bad spending habits. Finances are somewhat overwhelming to me even though I am very interested in them.
Forgive my word barf and general oversharing.