New around here

[JeffS]

Hey all,

Pretty new to the forums, been reading up for a few months. Trying to get out of this debt lifestyle and into a Mustachian lifestyle is a process but I'm working on it. I'm 22 years old with associates degrees in aviation maintenance, I just sold my 2013 Boss 302 Mustang and am in the process of selling my money draining 2008 F250. I was living the oilfield life for a while and now we all know where oil is. So I've decided to stay close to home and work at a local dealership. I bike to work and cook more and don't waste my hard earned money at bars. I have about $20,000 from the sale of the Mustang and make about $25,000 a year before tax. My main question is, should I put the cash into betterment since I would be in the lower fee end or into a vanguard fund? I'll answer any questions if you have em, looking forward to hearing some good advice!

[CowboyAndIndian]

Welcome JeffS.

What kind of debt's do you have? Maybe, payoff the debts.

Also, post a case study and the folks here will give you some good advice.

Best of luck, you are starting life off well.

[zephyr911]

Welcome and thanks for posting.
Good moves dropping the gas-guzzlers to begin with. I assume you're taking a pay cut by coming home, so cutting costs is the sensible thing to do.

More details on your financials might elicit better advice on what to do next.

[Jags4186]

Welcome Jeff!

I hope you can get your income up soon--while we strive to live on around 25k/yr here, theres a stark difference between living on 25k and having 25k/yr total at your disposal.

That said, I think you need to get yourself a solid foundation before you consider investing.

You have $20,000.

Do you have any debt?  I would pay it off.

I'd then throw about $10000 into a savings account for an emergency fund.  Many here are against emergency funds, however, since you do not make much money, you do not have a lot of wiggle room to just "figure it out from your monthly cash flow" vs some others here.

Then I'd take whatever is left and go open an account at Vanguard and begin investing.  You should head over to bogleheads.org and read up on their wiki about the "3 fund portfolio" and also visit our friend over at jlcollinsnh.com and read his stock series.

Once you feel you have a handle on it, I'd recommend going over to Vanguard, opening up an account, and set up your asset allocation as you see fit from your previous readings.

The biggest piece of advice I can give you is that as you make more money, keep living how you do.  Then pile all of that into investments and soon enough you will be FI!


Best of luck!

[JeffS]

Thanks guys! Here is a break down of my monthly expenses:
Rent, house with roommate, $540
Cell phone 35
Student loan is income based payments, $50; principal loan amount is for $18,000
Since I'm working on getting cooking down, I try to spend about $120 a month on groceries.

I have some small debts, a credit card with a balance of around $2,000 and a furniture loan. My SO is currently attending college for environmental engineering and her parents take care of most of her stuff. We use her car (a 2013 Ford Focus) to take care of any driving. The real downside to living in San Antonio is how far away everything is. The tentative plan for our future is two move to the Austin area when she is finished with her degree. I'd like to go back to aviation, but here in San Antonio, the jobs are all about 20 miles away. I figure I can stay here at the dealership and work my way up.

[Jags4186]

Thanks guys! Here is a break down of my monthly expenses:
Rent, house with roommate, $540
Cell phone 35
Student loan is income based payments, $50; principal loan amount is for $18,000
Since I'm working on getting cooking down, I try to spend about $120 a month on groceries.

I have some small debts, a credit card with a balance of around $2,000 and a furniture loan. My SO is currently attending college for environmental engineering and her parents take care of most of her stuff. We use her car (a 2013 Ford Focus) to take care of any driving. The real downside to living in San Antonio is how far away everything is. The tentative plan for our future is two move to the Austin area when she is finished with her degree. I'd like to go back to aviation, but here in San Antonio, the jobs are all about 20 miles away. I figure I can stay here at the dealership and work my way up.

Ok, I would highly recommend the Dave Ramsey baby steps 1,2, and 3.  Once you get your emergency fund set up you can go back and invest as I suggested above.

[JeffS]

I can see why you only recommend the first three steps haha

[fb132]

First off, try cutting your expenses enough so that you are able to save a minimum of 50% of your income, if you can do that, it will help you alot. Get rid of your debt. Since you are low in networth, start building an EF in the beginning (MMM reccommends from the get go to get rid of your EF, but I don't agree when you are low on your net worth).Once you have a big amount of money saved up in investments and you are able to save more than 50%+ of your income, then you can get rid of the EF since you will be covered in every possible way, the EF would be simply be useless at that point. I suggest you invest in vanguard and I also suggest you read this from MMM http://www.mrmoneymustache.com/2013/02/22/getting-rich-from-zero-to-hero-in-one-blog-post/. Make sure to read the links on that page, they are very usefull.

[CmFtns]

Thanks guys! Here is a break down of my monthly expenses:
Rent, house with roommate, $540
Cell phone 35
Student loan is income based payments, $50; principal loan amount is for $18,000
Since I'm working on getting cooking down, I try to spend about $120 a month on groceries.

I have some small debts, a credit card with a balance of around $2,000 and a furniture loan. My SO is currently attending college for environmental engineering and her parents take care of most of her stuff. We use her car (a 2013 Ford Focus) to take care of any driving. The real downside to living in San Antonio is how far away everything is. The tentative plan for our future is two move to the Austin area when she is finished with her degree. I'd like to go back to aviation, but here in San Antonio, the jobs are all about 20 miles away. I figure I can stay here at the dealership and work my way up.

you should really write a full "Case Study" in the "Ask A Mustacian" subforum.
Here is a guide: http://forum.mrmoneymustache.com/ask-a-mustachian/how-to-write-a-'case-study'-topic/
If you do this and provide all the details everyone will be able to help you much better.

[TheAnonOne]

It astonishes me how someone making 25k could acquire a 45k car. (Really nice car though...)

[FIRE me]

It astonishes me how someone making 25k could acquire a 45k car. (Really nice car though...)

He was probably making a lot more money when he was working the oil fields.

[JeffS]

It astonishes me how someone making 25k could acquire a 45k car. (Really nice car though...)

He was probably making a lot more money when he was working the oil fields.

Bingo. It's amazing how much you can make working away from home for three weeks at a time. I worked aviation before that

[zephyr911]

Props to you for deciding other things matter more than money. Hopefully someday you'll have your cake and eat it too.

[JeffS]

One of the guys that started just after me (in May) just left for West Texas. Just like that, didn't tell our boss, didn't give a  notice, just left when his old boss called him up at 11 am. Burning bridges for money. I like being home and not working 100+ hours a week.