Author Topic: New mustachian  (Read 2094 times)

militiarush

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New mustachian
« on: April 10, 2016, 11:51:07 AM »
Hi all! New convert here with a few questions. Here my scenario:

Age = 29
Salary = $65k (Take home around $950/wk)
Student Loans = $35k @ 5.14% (averaged rate)
Other debt = $0
Cash = $2k
Monthly expenses = $1200
MassMutual 401k = ~$3500

So I'm trying to figure out how to get out of the rat race basically. My family is lower middle class and none of us ever have, and I'd like to break that tradition.  I don't really know where to start thought.

I applied to refinance my student loans this morning with SoFi.com. I'm in month 14 of a 36 month car lease ($217/month + insurance + gas), but I might just have to ride that out unless anyone has any suggestions.  Anyone have any suggestions how I should manage my income?

Thank you!

prognastat

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Re: New mustachian
« Reply #1 on: April 10, 2016, 11:55:20 AM »
You will have to break up the monthly expenses a little more to get very useful help including how much a month you are adding to ay types of savings or retirement accounts.

Big one that can be given is focus on cutting as much as you can and pay off those student loans. Hopefully you can consolidate them and get them to a lower rate. At the current rate paying those off is most important. I would minimize your 401k to whatever the employer match is unless you can get the interest on this loans significantly lower.
« Last Edit: April 10, 2016, 11:58:48 AM by prognastat »

Bracken_Joy

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Re: New mustachian
« Reply #2 on: April 10, 2016, 11:59:12 AM »

tobitonic

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Re: New mustachian
« Reply #3 on: April 10, 2016, 12:00:18 PM »
You've got a great salary for your age (or any age, really), first of all. You're in the top 8% for millenials, and you can use that to your advantage. I'd get rid of the car lease immediately, because 22 months from now, you still won't have a car you own, and replace it with something cheap, safe, and reliable (e.g., anything from Toyota or Honda with ESC and side airbags) and drive it to 300k. I'd throw every spare dollar from then on at student loans until they're knocked out. After that, index funds until your invested amount equal 25x annual income, and then you never have to work again if you don't want to.

mozar

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Re: New mustachian
« Reply #4 on: April 10, 2016, 12:48:33 PM »
You're doing great! You can get rid of the student loans quick! I wouldn't bother to refi.

prognastat

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Re: New mustachian
« Reply #5 on: April 10, 2016, 01:21:16 PM »
If you really work hard at it you could pay off those debts within a year or so. Less if you are willing to cut everything at the cost of paying it off, but it all depends on how much you are willing to.

From that point on everything would be savings and really increasing the amount your stash is generating yearly.