Author Topic: New Mustachian and Freshly Minted Ph.D. Seeking Advice  (Read 1827 times)

lbcolin17

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New Mustachian and Freshly Minted Ph.D. Seeking Advice
« on: May 03, 2013, 09:56:53 AM »
I'm a 32 year old newly graduated Ph.D. working as a researcher.  Over the course of my undergraduate and graduate years, I've wracked up both student loan and credit card debt.  My profile appears below, so any advice would be welcome.

Current salary: ~$87,000 (before taxes)

Credit card debt: $18,500 (paying approximately $250 in interest total on 2 cards, AMEX and Mastercard)

Federal School Loans: ~$16,500 with a low interest rate.

Mortgage payment on a newly purchased home: ~$1350/month

Other bills:
Cable/internet: $150
Cell phone: $85
Utilities: TBD, just moved in...

Savings: $5,000 in an ING account

Any advice on how to save while also paying down debt?  Things I should be doing that I'm not, etc.?

Thanks much.


galaxie

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Re: New Mustachian and Freshly Minted Ph.D. Seeking Advice
« Reply #1 on: May 03, 2013, 10:10:05 AM »
You probably take home $4500/month or so.  $1350 goes to your house.  You haven't posted many details, but I bet we can assume $1k goes to all your other spending (phone, utilities, food, car, gas, whatever).  So you have $2150 to pay off your debts.

1. Make the standard monthly payment on your student loan (I assume that's about $100 or $150/month, because my student loans were similar).
2. Put all the remaining money into your credit card debt.  With you putting in $2000/month, it should be gone in 6-7 months.
3. Why do you have cable?  You can save $100/month by canceling your cable TV service and keeping only the cable internet.  Learn how to watch TV on the internet - cable TV is a waste of money. 

twinge

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Re: New Mustachian and Freshly Minted Ph.D. Seeking Advice
« Reply #2 on: May 03, 2013, 10:13:35 AM »
Congrats on your PhD and being gainfully employed connected to it.
If your 5K is genuine "savings" and not just the current slush fund for spending and you don't have any dependents, I would put it at least 3k towards your cc debt and just hyper focus on paying that off quickly as possible and open up a home equity line of credit (if you have any equity) on your house.  You want to be securely past the mindset that adding a dime more to your cc is not an option and that tapping into savings for a non-emergency is also not an option.

Since your house is newly purchased it will be especially important to watch your spending on furnishing it, getting various "needs" for it, etc. When you have credit card debt every single thing you purchase is essentially purchased at the interest rate of your debt since you're not paying it off and it's important to keep that mindset.

Hamster

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Re: New Mustachian and Freshly Minted Ph.D. Seeking Advice
« Reply #3 on: May 03, 2013, 10:16:22 AM »
Nice work Dr. and not doing years and years of post-docs for slave wages!

Savings/debt:
Biggest bang for the buck is generally: Max out any employer match in retirement plans (if you are eligible as a new hire), pay down credit card debt as fast as possible, then max out all other tax advantaged retirement plans.

Other thoughts:
Get rid of cable and just use netflix and or hulu. Life is too short to waste on cable TV.
Get rid of the $85 per month cell plan and look into cheaper options
See the superguide, Our new $10 per month iPhone Plans and Cheap Data.

Other expenses not posted, but the usual - minimize transportation costs, bike, use low cost entertainment, cook at home, etc.

Edit: fixed URL
« Last Edit: May 03, 2013, 10:19:58 AM by Hamster »