Author Topic: How to keep mom and the lady happy? Need help =)  (Read 5105 times)

fcruz420

  • 5 O'Clock Shadow
  • *
  • Posts: 4
How to keep mom and the lady happy? Need help =)
« on: June 07, 2013, 03:03:07 PM »
Good Afternoon MMM Community!!!
I Hope everyone is having a great day. I’m a newbie here and still catching up on post. My fiancée and I would love to join young retirees and I here to seek opinions and suggestion. We are both 30, residing in NJ and are planning to retire before 50. I’m hoping with your help and knowledge we can try to speed up the process to retiring around 40-45. We are still on a learning curve guys and gals so I apologize if anything isn’t clear.

Situation(Family):
I have a house that I bought 10 years ago to house a disabled mother, younger brother and myself. We are currently splitting the bills for the house and those figures are under “Exclude.” We do plan on selling that home, but at the moment they need a place to live, the housing market (New Jersey) isn’t in our favor and its working out for everyone.

Situation: My fiancée and I
The retirement, combined income, debt and expense is the case study I would love your knowledge and assistance on. We would love to make the best of our income and pay down her school loan so we can invest aggressively. We plan on investing 100% in VTSAX/VTSMX/VTI (wherever the money permits). Here are the questions I have.

1.   Given our expenses. What would you suggest regarding maxing out our employer 401k’s?
2.   I consider my TD Ameritrade account our emergency funds. Any suggestion on better ways to use that money?
3.   Any suggestions on building our financial independence money? Should the money we will live off of be in a taxable account or Roth?
4.   School loans!!! Why???? Lol… How can we put that $63k to rest?


Exclude:
My Mortgage/House Bills: $2,700 (balance on mortgage is 248k @ 3.70%) – Added to show where additional funds are going.
- this monthly equal total bills that my family and I split monthly.

Retirement:
His Income: $74k
Her Income: $82k
His 401k Contribution/Match: 6% - Current balance 70k
Her 401k Contribution/Match: 6% - Current balance 11k
His TD Ameritrade (taxable): $25k - $26k

Combined Income:$5,700

Debt:
Her school loan: $63k – Originally was $75k. Made a push to pay some down.
Credit card: $2,000

Expense:
Rent: $1,200
School loans: $1,100
Groceries: $350
EZpass/tolls: $250
Gas/Electric: $120 - $200 summer/winter
Car Maint: $100
Fuel: $450
Household items: $100
Internet/Phone: $75
Mobile: $150
Personal care: $125
Dining out: $200
Credit: $200

Cars:
2003 Honda accord - paid
2009 Honda accord - paid

On average that leaves about $1,200 - $1,280 monthly

Again….. Thanks in advance for time, cooperation and assistance.
Fred


marty998

  • Walrus Stache
  • *******
  • Posts: 6371
  • Location: Sydney, Oz
Re: How to keep mom and the lady happy? Need help =)
« Reply #1 on: June 08, 2013, 06:19:30 AM »

Cars:
2003 Honda accord - paid
2009 Honda accord - paid


Your cars are not "paid" because you continue to pay TEN THOUSAND DOLLARS PER YEAR for them on fuel, maintenance and tolls....how the hell do you spend $450 a month just on fuel????

Mobiles......read through IP Daley's Comms mega thread.


herisff

  • Stubble
  • **
  • Posts: 111
Re: How to keep mom and the lady happy? Need help =)
« Reply #2 on: June 08, 2013, 06:34:08 AM »
You have $2000 in credit card debt - assuming the interest rate is higher than the student loans, eliminating that debt should be your highest priority. You seem to be looking at your direct out-of-pocket costs only ($1100 to SL vs $200 to CC debt) - instead, take a look at your total interest costs.

I would pay an extra $400-500 a month to the CC (or more if you're willing and able) and that expense will be gone in a few months. Then do the same with the student loans.

Your auto fuel does seem high to me, but you may both have long commutes. However, your dining out cost of $200/month is high - cook at home (many suggestions here and elsewhere), take lunch and breakfast to work, and allow a good meal out once a month for $50 instead. You'll find you enjoy the experience much more when it's a true treat.

rubybeth

  • Handlebar Stache
  • *****
  • Posts: 1402
  • Location: Midwest
Re: How to keep mom and the lady happy? Need help =)
« Reply #3 on: June 08, 2013, 02:12:53 PM »
Your commuting costs seem really high with car maintenance, fuel, and tolls. Do you really spend $1,200/year on maintenance for the cars? Is there any way to use mass transit instead? Or can you move closer to your jobs so that mass transit or biking is possible? Your phone bills and eating out could also likely be reduced, as others have mentioned. DH and I have a rule we can only eat out if it's together for a date or if it's work-related (like lunch meetings) so our meals out are more special. Also, $100 in household items and $125 in personal care seems like a lot, but I guess that depends on what's going in those categories. I'd look at that and figure out needs vs. wants.

I'd kill the credit card debt in less than two months, none of this $200/month crap. I'd also want to kill the student loan debt while maxing out the 401k matching.

I'm a little confused on the income. You make a combined $156k, or $13k per month, but are only taking home $5,700 or 43%. Is that because of health care costs, 401k contributions, really high taxes, or what? When you get married, might your take-home pay go up?

fcruz420

  • 5 O'Clock Shadow
  • *
  • Posts: 4
Re: How to keep mom and the lady happy? Need help =)
« Reply #4 on: June 08, 2013, 06:22:59 PM »


Your cars are not "paid" because you continue to pay TEN THOUSAND DOLLARS PER YEAR for them on fuel, maintenance and tolls....how the hell do you spend $450 a month just on fuel????

Mobiles......read through IP Daley's Comms mega thread.
[/quote]

Thanks Marty998 I will search for the mega thread. Regarding the fuel you are correct, we've being searching for jobs/careers closer to home. Hopefully within a year these figures can change.

fcruz420

  • 5 O'Clock Shadow
  • *
  • Posts: 4
Re: How to keep mom and the lady happy? Need help =)
« Reply #5 on: June 08, 2013, 06:28:38 PM »
Thanks Herisff. We are working on those dining out numbers as well. Prior to finding MMM our dining out was 600-800 monthly in NYC/NJ metro area. We will work on bring the credit card balance to a close and snowball those funds into the school loans payment.

fcruz420

  • 5 O'Clock Shadow
  • *
  • Posts: 4
Re: How to keep mom and the lady happy? Need help =)
« Reply #6 on: June 08, 2013, 06:39:39 PM »
Thanks Rubybeth.
- We budget 1,200 a year for car maint. If we have overage we normally apply to school loans.
- Mass transit at the moment are options were looking into.

Half of my pay go towards my family situation and then the other half is budgeted in the 5,700. I should have mentioned the 74k and 82k are gross, so yes it still has taxes/401k/healthcare costs deducted from those numbers.

lhamo

  • Walrus Stache
  • *******
  • Posts: 9616
  • Location: Seattle
Re: How to keep mom and the lady happy? Need help =)
« Reply #7 on: June 09, 2013, 02:13:26 AM »
How old is your younger brother?  How much longer are you going to be needing to contribute to his support?  If I were you, I would be discussing with mom/him yesterday the need for a transition plan. 

Agree the amount you are spending on cars/commute is insane.  Definitely look into public transit options.  With the awful traffic in NY/NJ, you may find that using public transit saves you time as well as money.

Well done on cutting back on eating out, but you can still do more.

Definitely pay off that credit card and DO NOT RUN UP A BALANCE AGAIN!

With what is left over, I would split it between paying down the student loan and beefing up retirement savings.

rubybeth

  • Handlebar Stache
  • *****
  • Posts: 1402
  • Location: Midwest
Re: How to keep mom and the lady happy? Need help =)
« Reply #8 on: June 10, 2013, 07:51:24 AM »
Thanks Rubybeth.
- We budget 1,200 a year for car maint. If we have overage we normally apply to school loans.
- Mass transit at the moment are options were looking into.

Half of my pay go towards my family situation and then the other half is budgeted in the 5,700. I should have mentioned the 74k and 82k are gross, so yes it still has taxes/401k/healthcare costs deducted from those numbers.

Okay, that makes way more sense. I figured the income was gross, but couldn't figure out how $13k gross became about $6k net. For the family situation, are those costs fixed each month? Or are you giving an allowance of sorts and they decide how to spend?

brand new stash

  • Stubble
  • **
  • Posts: 148
Re: How to keep mom and the lady happy? Need help =)
« Reply #9 on: June 10, 2013, 08:51:19 AM »
If you take your current left over each month -$1200, plus what you are paying on your credit card- $200, plus half your eating out- $100 you will have $1500 a month.

Month 1: Pay $1500 on the credit card and your existing $1100 on the student loan.
Month 2: Pay $500 on the credit card paying it off entirely and the existing $1100 plus the $1000 freed up from the credit card bill towards the student loan.
Month 3- 24: Pay $2,600 a month towards the student loan to pay them off entirely.

If you can cut back on your commuting costs or other expenses throw the money at the student loan and you will be out of debt even faster.

Rebecca Stapler

  • Pencil Stache
  • ****
  • Posts: 907
    • Stapler Confessions
Re: How to keep mom and the lady happy? Need help =)
« Reply #10 on: June 10, 2013, 08:57:34 AM »
Are you currently contributing to your 401k's up to the match?
What is the interest rate on the SLs?

As long as the SLs' interest rate isn't astronomical (a la private SLs), I would continue with contributing to the 401k's up to the match, get rid of the cc debt as quickly as you can (like, pay it with any extra you have this month, plus push your limits and say "no eating out or buying anything non-essential until this is paid off" and put the money you save into the cc as well), and then focus on the SLs.

When do you make that SL payment? I recently started on this forum. We had a plan to snowball our SLs with a measly $200/month payoff, which sometimes we paid and sometimes we didn't. Since starting on here, I realized that we need to prioritize the SL payoff so it happens at the beginning of the month, not the end -- because I found that sometimes there wasn't "enough" to pay it and we would skip that month. With the lump sum payment at the beginning of the month, we are forced to make the rest of the month work with the money left over after the big payment. This month, we put $2400 towards that sucker. It feels incredible!

Rebecca Stapler

  • Pencil Stache
  • ****
  • Posts: 907
    • Stapler Confessions
Re: How to keep mom and the lady happy? Need help =)
« Reply #11 on: June 10, 2013, 09:05:30 AM »
If you're looking to cut your budget and you aren't in a position to move closer to your jobs or change jobs ...

Transportation
* Can you commute together? How about part of the way (ideally, the part on the toll road), and leave a car somewhere overnight?
* Can you drive backroads to avoid the toll?
* Do you still have snow tires on your car, or do they need to be inflated? (can help with gas mileage)

Food, household, personal care
* Fold your dining out into your food budget, make it $450 or something aggressive, and if you want to dine out that month, subtract it from your grocery bill ... if you have no more grocery $$ left near the end of the month, see what you can do with the food already in your fridge / cupboards
* Personal care: What does this include? It seems high. I recently cut out some easily replaceable salon services that really impacted our bottom line.
* Household: What does this include? It also seems high. We have a $125 budget that includes toiletries, toilet paper-type supplies, and diapers. I aggressively coupon, but we also have $$ left over at the end of the month in this category unless a big necessary household expense comes up (like replacing our garbage can last month because the garbage truck destroyed our other one).

madage

  • Bristles
  • ***
  • Posts: 405
  • Location: TX
Re: How to keep mom and the lady happy? Need help =)
« Reply #12 on: June 10, 2013, 10:30:31 AM »
Thanks Marty998 I will search for the mega thread. Regarding the fuel you are correct, we've being searching for jobs/careers closer to home. Hopefully within a year these figures can change.

It's here. It also has great sections on how to save on home internet and telephone.