I’ve been reading MMM since last fall and have learned a lot! Now that I have graduated and scored my first job I’m looking to apply the mustachian principles in my life.
I’m taking advantage of the rent/utilities provided by my parents cost-free while I am starting out, so my expenses are minimal (see below). I drive 21 miles round-trip when working from the office, and 40 miles round-trip in the opposite direction when working at a client site. Regarding investment, my employer won’t allow me to invest pre-tax until early September (3 months employment) and my employer also has a discretionary match given in March for the previous year (unsure of this value). Also, all employer plans are handled by Vanguard.
I plan on living with my parents for 1-2 years at most.Additional information: I plan to get a master’s degree at some point over the next seven years. Employer will pay 75% tuition if I study while working. I still have access to my parents’ 529 plan (this is why I’d like to acquire a master’s in seven years), so I don’t need to save 100% of a master’s degree’s expenses.
Income: $55,000/year (~$1,500 bi-weekly post-tax, including benefits deductions)
Current expenses:FixedRent/utilities: $0
Car Insurance: $1000 (includes liability)
Car Maintenance: $300 (no clue)
Total Fixed/year: $1,300VariableGasoline: $1000
Groceries: $2400 (tentative – am just now starting to track)
Entertainment: $600 (I’m a homebody and a cheapskate)
Phone: $600 (My portion of the family plan. Investigating future personal options)
Medical/Dental: $200 (I’m healthy and have insurance through my employer)
Vacation: Two-week backpacking, likely overseas (~3,000?).
Total Variable/year: $7,800Total Expenses/year: $9,100 (~9,000)Expected ER expenses: Not sure.
Assets:
Car: 2005 Honda Accord, 4 cylinder, manual transmission, 90,000 miles (~$7,000). Plan to keep.
Various personal items: Clothing, exercise/outdoors equipment, musical instruments (~1,000). Plan to keep.
Savings: Low-interest bank savings account savings (~$4,000).
Cash: Checking account (~$2,000).
Total Assets: $14,000Liabilities: Zero debt (no student loans)
Total Liabilities: $0Specific Question(s):
- If I use an 80% paycheck deduction (maximum allowed) for my company’s pre-tax 401(k) plan I would only be able to invest $14,500 by the end of 2014. Should I try and do this, or would it be wiser to invest a portion of this $14,500 somewhere else?
- What should I do with the money I make before September (when my pre-tax company plan becomes available to me)? Should I invest this on my own, or would the company Roth 401(k) (which is already available) be a better choice?
- Between now and the end of the year, how much of my savings should I invest in company plans vs. on my own (such as in a Vanguard Index Fund)? And if I choose to invest some of this money on my own, should I pick a company other than Vanguard (my company uses Vanguard to manage the company plans)?
- I am also looking into getting a credit card sooner rather than later (I want to start building credit history) – any suggestions on a good card?
Thanks in advance for the responses! Any advice is greatly appreciated.