Author Topic: Options for the fall - student loans, brand new job, commuting  (Read 3818 times)

SpendyMcSpend

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Options for the fall - student loans, brand new job, commuting
« on: February 15, 2012, 02:58:25 PM »
I am 29 (female) and in the process of completing my MBA and taking the CPA exams in New York.  I have a job lined up that will pay me $57,000 per year for my very first accounting job.  I currently have another career going making $75000-$90000 per year depending on how much overtime I do, but there is no career progression there and new people are all 21-22 so I feel silly staying put (plus I'm bored with my current work).

Right now my expenses are:
$590 rent (I pay half of my boyfriend's mortgage in the co-op he owns)
$254 train ticket to work
$70 car insurance (beater without collision)
$108 Metrocard (subway for work/class)
$80 CPA review materials/application fees/transcript fees (It's hundreds but I divided it by the number of months)
$425 debt payments (student loans totaling $52,000)
$108 iPhone (my commute is 1.5 hours each way so this is a lifeline to me)

In October, we plan to move back into Manhattan or surrounding areas.  We can either rent in Manhattan, Brooklyn, or Queens (the further we move in the boroughs the cheaper it is, but commute will be 35-60 minutes depending on how far we move).
Estimated expenses would be:

Manhattan:  commute time 30 minutes or less
$1200 for a bedroom in a 3 bedroom apartment
$108 Metrocard
$80 CPA review materials
$425 debt payments
$108 iPhone

Queens/Brooklyn:  commute 45-60 minutes
$850 for a bedroom in a 3 bedroom apartment
$108 MC
$80 CPA
$425 debt
$108 iPhone

The other option is boyfriend taking the $70,000 he has in savings and buying a one-bedroom for us somewhere in the city and me paying him rent.  He might live there or might not.  Right now, we can't rent out his co-op in the 'burbs because there are rules against it, but we could possibly do so for 1-2 years if we have a compelling reason.  My compelling reason is because I'm completely fried from commuting, and my new job will be at least 60 hours per week.  I will be getting rid of my car if I move into the city.  Dry cleaning, food and everything else is more expensive in Manhattan but the commute time (even by bike) would be great.

My other problem is I don't know if I should focus on saving an emergency fund from now until October (because of the huge pay cut) or focus on paying off some of the student loans.  I estimate I can pay off $22,000 in loans by October but that is rather optimistic.  I can take a 0% loan from work and pay it back in 10 paychecks.  So I can borrow $4200 from work, and pay $420 for 10 bi-weekly paychecks and chop off some of my debt.

My current bi-weekly paychecks total $2100-2200.  With the work loan they'd total about $1680 per 2 weeks.  At my new job I will be making 1400-1500 per paycheck.

SpendyMcSpend

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Re: Options for the fall - student loans, brand new job, commuting
« Reply #1 on: February 15, 2012, 03:05:39 PM »
Oh also, right now are sharing a studio so we can't downsize too much more.  My new job starts in October 2012.

Jeez, I left out a lot of stuff.  One bedrooms in Manhattan would rent for between $1600-3000 per month.  One bedrooms in Queens/Brooklyn would be about $1300-2000 per month if we went that route.  One last thing I should mention is now I'm helping my brother who is disabled (he has applied for SSD but turned down 2 times because his treatment history is too short, but he will probably get it soon).  I am providing him with $50-100 per month in groceries and $50-100 in other expenses.
« Last Edit: February 15, 2012, 03:16:51 PM by Meadow »

MacGyverIt

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Re: Options for the fall - student loans, brand new job, commuting
« Reply #2 on: February 15, 2012, 06:14:26 PM »
I am 29 (female) and in the process of completing my MBA and taking the CPA exams in New York.  I have a job lined up that will pay me $57,000 per year for my very first accounting job.  I currently have another career going making $75000-$90000 per year depending on how much overtime I do, but there is no career progression there and new people are all 21-22 so I feel silly staying put (plus I'm bored with my current work).

If your goal is early retirement, I'm at a loss as to why you'd take such a dramatic pay cut. Heck, you may be bored stiff in the new job but with a steep pay cut.

Have you run your early retirement numbers to see what a difference the 18-33k drop will make? How long will it take you to progress in this new career to reach your current income level? In a world of carefully planning financial gain/loss, cutting cable and eliminating pricey cell phone plans to save every cent this seems counter intuitive. No offense intended, just thinking you'd have to work many extra years (in a job you may or may not like) and delay your early retirement if you take this pay cut.

SpendyMcSpend

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Re: Options for the fall - student loans, brand new job, commuting
« Reply #3 on: February 16, 2012, 09:11:01 AM »
I think I might be able to move back up to $70/80s within a couple of years and the upside is much higher as far as salary goes.  I understand that point, but with all my student loans it might take me even longer to retire, and I don't want to be working with a bunch of 22 year olds for the next 5-7 years doing the same exact thing I'm doing now.

alex

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Re: Options for the fall - student loans, brand new job, commuting
« Reply #4 on: February 17, 2012, 12:47:02 PM »
Hi Meadow, it sounds like you're really excited about this, and I don't want to rain on your parade, but...

I used to work at an accounting firm in Manhattan and it was not fun.  :-(

Long hours, and with an MBA, you might try for something better than a Big4 (if that's where you're going).  Yes, the financial upside is great if you make partner, but you'll be working like a dog for not that much money for a very long time before that happens.

Also, you will be working with a bunch of 22 year olds at an accounting firm.  Every year they get a lot of fresh graduates and everybody moves up together, while others from their starting class leave.  In fact, you will probably have to report to people who are 25-27...

From a financial freedom standpoint, having lived in Manhattan for several years, making slightly more than the figure you quoted, and still not being able to save given the taxes and extremely high cost of living (not that i was very Mustachian then), I would encourage you to reconsider...  I felt pretty trapped where I was, and don't want the same for you...

MacGyverIt

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Re: Options for the fall - student loans, brand new job, commuting
« Reply #5 on: February 17, 2012, 08:57:56 PM »
Long hours, and with an MBA, you might try for something better than a Big4 (if that's where you're going).  Yes, the financial upside is great if you make partner, but you'll be working like a dog for not that much money for a very long time before that happens.

Hey Alex, from a "Your Money or Your Life" perspective, when you divide out the number of hours worked against your income at this company, what were you *really* paid per hour during this experience? The dollars per TRUE hours worked probably don't quite line up to the salary you were paid, I'd wager. (Cost of living, hours worked, hours commuting, transit costs, dry cleaning, etc.)

SpendyMcSpend

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Re: Options for the fall - student loans, brand new job, commuting
« Reply #6 on: February 18, 2012, 07:10:46 AM »
Alex, where have you worked since you left the accounting firm?  I have heard it is not good while there, but I have also heard of people getting jobs for $90,000 elsewhere in their career field after 1.5 years at a Big 4. 

My point about the 22 year olds was that at my current job, I'll be working with them forever!  With the Big 4, I will only be working with them for 2 years and I can move on to something better.  Unless there are not exit opportunities?
« Last Edit: February 18, 2012, 07:44:32 AM by Meadow »

alex

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Re: Options for the fall - student loans, brand new job, commuting
« Reply #7 on: February 20, 2012, 11:08:26 AM »
MacGyverIt:  You're absolutely right.  I wasn't trying to infer I was making a lot of money, especially on a per hour basis.  I was just saying that partners make a lot of money, though, their lifestyle still isn't even that desirable...

Meadow:  I'm actually still at the same company, just in a different location.   There are definitely exit opportunities, but if you're already making 75-90k, seems like with an MBA you could get a better job and skip the big4 thing all together, which I would recommend highly! :-)  Again, I don't know all the details of your situation, but don't give up looking other places just yet. It's definitely worth spending the time and effort finding the best job you can.


SpendyMcSpend

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Re: Options for the fall - student loans, brand new job, commuting
« Reply #8 on: February 20, 2012, 06:13:41 PM »
Thanks Alex.  I do have a decent job now, but it's not IN accounting.  I'd like to be making 75k-90k or more in accounting as I think the industry has more upside and I would like it better than what I'm doing now.  Right now, I really have no exit opportunities unless I go more towards a marketing angle and I am not really interested in that...