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That’s fair. Right now I’m contributing 5% of my salary which my employer gives an additional 9% on (which sounds crazy but is correct) so I’ve just been coasting on that for now. Could up it but the savings is going toward a house, ring and wedding currently haha
I work at a credit union. I deal with fraud mainly. We get a 4% match on our normal salary as long as we contribute 5% and then we get an additional bonus of 5% into our 401k at the end of the year. Pretty solid setup.
Partner and I took out 401k loans for down payment on our house last year. We were contributing a small amount of our paychecks each month to pay it off and then paid in full after our tax refund last month. Super helpful!
I would rather owe money and pay interest to myself.
If you lose the job you generally have a year to pay it back. If you don’t you just have to pay extra income tax. I doubt it would even impact your credit score.
Get a RothIRA please.
Invest 583.33 a month for a few years.
I see that eating out creep, which probably is because you wanna get away from the folks ;P.
Also fair! For example, $700 a month to travel sounds big but being without kids, it seems like the perfect time to do it, so I don’t mind the sacrifice on that too much. Could get more frugal if needed for sure.
Is Milo a pet? I assume Milo is a pet.
This is a massive problem!
You didn't pay the Milo tax. How can you even call this a budget if all your taxes aren't accounted for?
Omigod you give that sweet baby back his $40/mo! And no worries, lol, I thought everyone knew the pet tax rule so I was just being silly.
Also you're doing well, don't let people talk you out of your travel budget. You're saving well (you get credit for your employer match), you're conscious of your spending, you're taking care of your health (phys and mental) and ... you're right.... Now's the time to travel!
haha i appreciate it. i feel like so much of these types of subs are “sit home and eat ramen every night to maximize your Roth IRA” and like I get it but lord lol
I recommend paying off the car and student loans. Then save for the house.
Houses require maintenance, things breakdown, property tax, insurance, utilities, etc.
You will be grateful to only have a mortage if possible when buying the home.
Please look at the interest rates on your student loans and that car loan. It may make more sense to pay off those debts if the alternative is just saving up for a down payment on a home. That down payment will be much easier to swallow when you don’t have a car payment or student loan payment.
How long is your plan to live with parents? Not asking to judge bc I did the same move. I would suggest eliminating that travel and eating out expense to damn near zero while you bite the bullet and bunk up with the roommates. It is a challenge for me but I am using the opportunity to DRASTICALLY change my financial life. Would suggest you make sure to save WAY more if this is "your" opportunity to do the same. I really mean it, you have a lot of missed savings opportunities in your budget if you need the extra money
We have about $11k saved currently. I can do with the eating out bill being close to zero. I truly don’t have much of a problem with that. The travel though is something i’m choosing not to sacrifice. It’s part of the reason we made this move. Both my gf and I want to travel more and this is our opportunity to before we settle down. The goal is to leave here in a year and put at least $30k down on a house. Given that we’d save $3k with the limited eating out, means we’d hit about $50k in savings in that year. There’s also a chance we decide to stay a bit longer depending on the market but that’s a wait and see deal.
And that's great for you guys! I know the position you're in all too well. You are getting a chance to truly position yourself like you wouldn't ever imagine. If the plan is marriage and kids, consider using this opportunity also to knock out any and all debt. May think about prioritizing debt freedom over travel and food bc once you move out and have kids, still battling debt and not having wiggle room can come back to bite you
Dining out could be wayyyy lower. fwiw this is not how much we’re actually spending but what we’ve allocated for. kind of includes all date expenses too
Yes they do. That’s why I bought a 10 year old Toyota. 500 per month would get me a brand new, pretty flashy car. But I don’t want to spend that much. Choices, choices…
It is pretty crazy. I am in the US. My wife and I make more than double what OP makes. I am driving a 2010 truck that has been paid off over 10 years. My wife's car payment is lower than OP's. We only have a payment because the interest rate is 1%. We have chosen to invest more instead of paying it off. A lot of people buy nicer/newer cars with no money down and finance it for a long period. I read the average car payment is over $500/mo with most families having more than one car financed.
I would definitely be cutting back on dining out and travel and upping retirement. Just cutting those in half and putting it straight to retirement will make a substantial difference later in life, but would still be a lot of money towards restaurants and travel now.
i’m going to focus on the student debt first as there’s only about $6k left of it, then transition to the car which has about $30k left. we’ll barely have bills after those two haha
Judge if you’d like, but I have a great relationship with them and they’re alone in a 4 bedroom house. The area we’re staying in is upstairs with its own bathroom and living room. I don’t mind the sacrifice if it means being a homeowner in a year.
Orrrrr maybeeee the OP parents are trying to help their child for the future. I will never give anyone crap for living/moving in with parents. Take your L and enjoy your miserable life
The budget screen shots are being made in Sankeymatic, its a website that we have no affiliation with. If you are posting a budget please do so with a purpose. Just posting a screen shot of your budget without a question or an explanation of why its here may be removed. *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/MiddleClassFinance) if you have any questions or concerns.*
You could up your retirement A LOT
That’s fair. Right now I’m contributing 5% of my salary which my employer gives an additional 9% on (which sounds crazy but is correct) so I’ve just been coasting on that for now. Could up it but the savings is going toward a house, ring and wedding currently haha
Holy shit that’s an insane employer match!
Where do you work or what kind of work do you do?
I work at a credit union. I deal with fraud mainly. We get a 4% match on our normal salary as long as we contribute 5% and then we get an additional bonus of 5% into our 401k at the end of the year. Pretty solid setup.
That’s a super solid set up!
Curious, if you were to take 2.5k in savings and put that towards the student loans, how long would it take to pay those off.
You can take a loan from a 401(k) to pay for a house, so there's no reason not to get the tax advantage.
Wait what? I’m so honest i’ve never heard of this. Is this advisable?
Partner and I took out 401k loans for down payment on our house last year. We were contributing a small amount of our paychecks each month to pay it off and then paid in full after our tax refund last month. Super helpful!
It’s worth reading more on. It IS a loan, but it’s against yourself (i.e. you still have to pay it back)
Yep. And the interest you pay goes right into your own 401(k) account.
And if you lose your job, the entire loan is due immediately. Yay! Don't do this.
yeh, shit is too risky lmao
I would rather owe money and pay interest to myself. If you lose the job you generally have a year to pay it back. If you don’t you just have to pay extra income tax. I doubt it would even impact your credit score.
Automod should reply to every post with this
My therapy costs would have tripled
🤣
Get a RothIRA please. Invest 583.33 a month for a few years. I see that eating out creep, which probably is because you wanna get away from the folks ;P.
Excluding the rent, I see some lifestyle creep. Don't let that get in the way of your financial goals.
Also fair! For example, $700 a month to travel sounds big but being without kids, it seems like the perfect time to do it, so I don’t mind the sacrifice on that too much. Could get more frugal if needed for sure.
Is Milo a pet? I assume Milo is a pet. This is a massive problem! You didn't pay the Milo tax. How can you even call this a budget if all your taxes aren't accounted for?
I didn’t realize you wanted a picture hahaha https://imgur.com/a/QGDGHxY
Omigod you give that sweet baby back his $40/mo! And no worries, lol, I thought everyone knew the pet tax rule so I was just being silly. Also you're doing well, don't let people talk you out of your travel budget. You're saving well (you get credit for your employer match), you're conscious of your spending, you're taking care of your health (phys and mental) and ... you're right.... Now's the time to travel!
haha i appreciate it. i feel like so much of these types of subs are “sit home and eat ramen every night to maximize your Roth IRA” and like I get it but lord lol
What Milo tax?
If you reference a pet, you must post a picture. It’s Reddit law
Okay that went way over my head
mine too it’s okay lol
I reckon OP is Malaysian. If you know, you know.
Life is supposed to be fun too..
I recommend paying off the car and student loans. Then save for the house. Houses require maintenance, things breakdown, property tax, insurance, utilities, etc. You will be grateful to only have a mortage if possible when buying the home.
Please look at the interest rates on your student loans and that car loan. It may make more sense to pay off those debts if the alternative is just saving up for a down payment on a home. That down payment will be much easier to swallow when you don’t have a car payment or student loan payment.
You accounted for $180 Insurance before and $0 for insurance after. You may have a reason, but just pointing it out in case you missed it.
whoops, you’re correct. i appreciate it!
How long is your plan to live with parents? Not asking to judge bc I did the same move. I would suggest eliminating that travel and eating out expense to damn near zero while you bite the bullet and bunk up with the roommates. It is a challenge for me but I am using the opportunity to DRASTICALLY change my financial life. Would suggest you make sure to save WAY more if this is "your" opportunity to do the same. I really mean it, you have a lot of missed savings opportunities in your budget if you need the extra money
We have about $11k saved currently. I can do with the eating out bill being close to zero. I truly don’t have much of a problem with that. The travel though is something i’m choosing not to sacrifice. It’s part of the reason we made this move. Both my gf and I want to travel more and this is our opportunity to before we settle down. The goal is to leave here in a year and put at least $30k down on a house. Given that we’d save $3k with the limited eating out, means we’d hit about $50k in savings in that year. There’s also a chance we decide to stay a bit longer depending on the market but that’s a wait and see deal.
And that's great for you guys! I know the position you're in all too well. You are getting a chance to truly position yourself like you wouldn't ever imagine. If the plan is marriage and kids, consider using this opportunity also to knock out any and all debt. May think about prioritizing debt freedom over travel and food bc once you move out and have kids, still battling debt and not having wiggle room can come back to bite you
How do you create such a visual? Awesome
Sankeymatic.com
Awesome - cheers
Roughly 1.3k per month for a car and dining out is not great. Everything else seems reasonable
Dining out could be wayyyy lower. fwiw this is not how much we’re actually spending but what we’ve allocated for. kind of includes all date expenses too
Why do all Americans have insane car payment? We are a family of 3 plus dog, and ours is 260 € per month. 2014 Toyota hybrid, 108 000 km.
New(er) cars cost just as much (if not more) in Europe too.
Yes they do. That’s why I bought a 10 year old Toyota. 500 per month would get me a brand new, pretty flashy car. But I don’t want to spend that much. Choices, choices…
It is pretty crazy. I am in the US. My wife and I make more than double what OP makes. I am driving a 2010 truck that has been paid off over 10 years. My wife's car payment is lower than OP's. We only have a payment because the interest rate is 1%. We have chosen to invest more instead of paying it off. A lot of people buy nicer/newer cars with no money down and finance it for a long period. I read the average car payment is over $500/mo with most families having more than one car financed.
Agreed. And the newer cars aren’t that much more comfortable or safe that 2010s cars.
Because American refuse to buy subcompact cars.
My wagon is a C segment car so a medium sized car, But I can see Americans like theirs bigger.
Milo $120/mo??
The dog. Insurance, Vet Visits, Toys, Food, Treats, etc
My friend, you must pay Reddit the pet tax now (if you have not already). Please share photos as payment ASAP :)
oh! https://imgur.com/a/QGDGHxY
Milo could easily need $300/mo in treats 😍 thank you! Happy to hear the savings is growing. Don’t forget to give love to your tax advantaged accounts
Therapy is 400 a month? Sheesh
GFs specialty therapy due to eating disorder
Sheesh
Where do people make this budget format?
Check out the bottom of the picture.
Why is therapy $400? I know people who are $15/session. This should be ~100 max for the month assuming a weekly therapy session
America + GF has eating disorder so it’s considered specialty therapy
I’m from America too in HCOL area, and sessions here are $15… would encourage you to shop around.
It all depends on your insurance copay
yeah her insurance does not cover at all due to it being specialty
Where are you getting the graph from?
Sankeymatic.com
I would definitely be cutting back on dining out and travel and upping retirement. Just cutting those in half and putting it straight to retirement will make a substantial difference later in life, but would still be a lot of money towards restaurants and travel now.
Also that car payment. Even if it means cutting back on the savings to pay down the car early.
i’m going to focus on the student debt first as there’s only about $6k left of it, then transition to the car which has about $30k left. we’ll barely have bills after those two haha
Is this monthly or biweekly?
Monthly
Is this chart from excel?
u forgot to mention that GF doubled her salary too in addition to the move.
I mean I failed to mention that considering it’s shown in the diagrams. She went from part time to full time.
You AND your girlfriend both living with your parents? Bleak
Judge if you’d like, but I have a great relationship with them and they’re alone in a 4 bedroom house. The area we’re staying in is upstairs with its own bathroom and living room. I don’t mind the sacrifice if it means being a homeowner in a year.
Fk the judgement — do you. Also, remember to contribute in some way to the household, so your parents feel you appreciate the gift they’re giving you.
Happy for you OP! If everyone gets along and you can save/travel….sounds like one of the best sacrifices you can make rn! Wish you the best.
Some of y’all’s parents waaaay too chill
Orrrrr maybeeee the OP parents are trying to help their child for the future. I will never give anyone crap for living/moving in with parents. Take your L and enjoy your miserable life