Expecting More Expenses and freakin' out!

[ReinventedProfessional]

Friends, I'm 32 years old, changing jobs/careers, moving five hours away with my soon to be bride, and will fortunately get a 20% raise over my present salary. I'm also in graduate school studying to be a psychiatric nurse practitioner, which pays exceedingly well (110-120k/year) in my area, and I'll graduate May 2015. As said, I have a job lined up. She does not.

Like all Americans, to varying degrees, we have financial problems.

1. I spent $11k cash for an engagement ring. It's nice, and she deserves it, but after my income tax return I now have only 21,719 in savings. That seems like a lot for most Americans, but taking a ten grand hit hurts anybody psychologically.

2. I owe Visa 2,072. No matter how hard I try over the last 6-8 months I can't help but pay it down significantly and then charge it back up. For example, I just bought this laptop I'm typing from for 700, but I literally needed a new one thus the expense.

3. We're moving. Moving is expensive. Moving costs, deposits for utilities, deposits on a house we'll be renting. Geez it's just more money lost!

4. Due to some financial setbacks of her own, my fiancé has maybe 2k in savings.

5. On top of that, later this year there are wedding costs, honeymoon expenses, and so forth. I'm not complaining about the event, but I'm getting really cost conscious.

6. Also, here's the clencher, I have 36k in student loans. I've always felt that after I finish my master's that I'll be able to pay that off rather rapidly given the typical salaries of recruited graduates from my program. Seeing the above cumulative expenses makes me think I'm never going to get out from under this debt load.

I agree this is wordy and seems like a lot to talk about, but I think I'm developing an ulcer over this and definitely have hypertension. I want to have ZERO credit card debt, start getting my savings back over 30k, and pay my student loans off by Christmas 2016. I have a Roth IRA that took a major hit in 2008-2009 and since then I've really skimped on contributing to it. I also have a floundering employer-sponsored retirement plan. I don't own any real property, have maybe 3.5k in precious metals locked in a safe deposit box, and used to have a thousand cash on hand here in the house. I used to do really well financially. I never made "a lot" of money, but I was always able to save a lot proportionately to my income as well as make prudent decisions. Other than my credit card (2,072), I have no current, pressing debt. Six months after completing my M.S. I'll have an additional ~40-45k.

Any tips, pointers, suggestions, etc. on the above six problems would be of substantial help. I don't know what I'm looking for really. I've researched this over and over. I just want a definitive solution.

Thanks and best wishes,
RP

[autoxer]

It's nice, and she deserves it...

This is a dangerous attitude. I know you want to show her how much you love her, but it doesn't have to be so expensive. I'm sure the wedding and honeymoon expenses will be a touchy subject as well, but think about how much grief this spending causes versus how much happiness you get from it.

You mentioned your future salary, but that is still over a year away. It sounds like you are raising up your spending before your income goes up. You need to learn how to spend against your current salary, not what it could potentially be down the road.

One little suggestion: You could sell your precious metals and pay off your credit card debt.

[BuckyBadger]

You may have needed a laptop, but you didn't need a $700 one.

It's all about the choices we make.

[ReinventedProfessional]

Thanks for the prompt replies. I have considered selling gold and silver to payoff my CC debt. It's just so hard to do, lol. I actually began buying that because I'm a prepper, and precious metals hold their value fairly well. I follow that market and would own more if I didn't have grad school expenses.

I do want to clarify one thing on the laptop. I actually purchased an extended warranty on it for around $120, if I remember correectly, and since laptops seem to last me about 18 months it seemed like a prudent financial decision as the warranty will outlive my laptop track record.

Someone mentioned 21k being a good start for moving expenses. I hope upon hopes that moving doesn't cost ten percent of tthat. Rent isn't too high in my state.


I think I overdid it on the ring as well, but it'll last a lifetime. I have insurance on it as well. I hope the wedding is cheap We're having it at her parent's house on the beach and only inviting parents and siblings so there'll be seven guests, lol. Disney World is the honeymoon destination! Historically we've been spendthrifts but lately the expenses keep piling up. My fiancee is a tax auditor, but even she's had trouble managing her finances as well lately as previously described.

Just venting as I slug away some late hours in my office. I'm a RN in case management.

[skip17py]

You will be fine. $21k in savings is healthy and the student loan debt is not bad debt. Just be more frugal with your money moving forward.

[breathemusic]

To clarify, you have a job now, but are moving, so the new job at the new location will pay you 20% more.... but on top of that, when you graduate you'll be changing jobs again and your new salary will be around $110-120K? Or are you not moving until you graduate next year, so the 20% raise IS the new salary of $110-120K?

Maybe it's just me, but I don't see anything wrong with your financial picture. Sure, the ring was expensive, but you paid for it in cash, not with interest bearing credit. Of all the things to splurge on in life, I think an engagement ring is a reasonable one.

The only thing I see that really makes your financial plan look so aggressive is the fact that you want to have all those student loans paid off in a short amount of time. That's an excellent plan, and you should definitely shoot for it. But it's also not the end of the world if it ends up taking you a year longer than you planned. That's still way faster than the 10, 15, or 20 years that the loans would be set up to last.

With 21K in savings, I'm not sure I understand why you haven't just paid off the CC outright. You didn't say what your income is, but it's clearly enough that it's allowed you to pay bills, save up for an $11K ring, and save an additional $21k over time. Moving does not cost $21K. Especially if you pack stuff yourself, and limit paying other people do do the moving as much as possible. As for utilities deposits, this might vary from company to company, but I know that for some, if you have good enough credit, they don't always require a deposit. Maybe that's changed.

It also sounds like you're working to keep the wedding expenses down, so that sounds reasonable as well.

I say just keep doing what you're doing, but be aware of those expenses and make sure the costs don't creep up to the point of being unmanageable. But otherwise, don't freak out and stress yourself out over something that isn't actually a problem right now. I think you have things under control.

[MonkeyMama]

You paid $11k for a ring and you have $36k in student loan debt. Um yeah, that is a LOT of financial stress.

Fast forward 20 years, having solid incomes, etc., I just can not imagine spending that much on one ring. (Well, I've never even spent that much on a car??). It's difficult (impossible?) to gain forward momentum with those kinds of expenses when just starting out.

You realize this and are planning a cheap wedding. This is a good start. You will have a very nice starting salary. Use it to knock out your loans and to save for your future. Don't get caught up in having to have everything new/now. Think through big purchases more carefully. Learn from past decisions. Just because you have the cash doesn't necessarily mean you can afford it. You maybe has cash for the ring, but then basically your student loans are financing that. You could have instead knocked out the student loans much sooner, which is priceless.

Being able to prioritize is an important financial skill. The gut reaction is often that it's sad or deprived that we would not spend $11k on a ring or a car. BUT, not having to work so much is a much bigger priority to us. We also certainly have our splurges. But, we just can't have everything, and so have to prioritize that which bring us the most happiness. Tying up a large amount of resources in one object is generally not a recipe for happiness. & I do think that is a lot of where your feelings and stress is coming from. Good Luck!

[Eagle]

Friends, I'm 32 years old, changing jobs/careers, moving five hours away with my soon to be bride, and will fortunately get a 20% raise over my present salary. I'm also in graduate school studying to be a psychiatric nurse practitioner, which pays exceedingly well (110-120k/year) in my area, and I'll graduate May 2015. As said, I have a job lined up. She does not...

Honestly, your situation isn’t all that bad. As of April 2014 average: CC debt in the U.S. is 15.2k, mortgage debt 154.3k, SL debt 33.6k. You have little CC debt, no mortgage, and average SL debt. You’re fine.

Keep in mind the stress could be in part due to the changes in your life: engagement, move, wedding, honeymoon, new job… All those are major life events that have happened in a relatively small window of time it seems.

The move will only cost 3-4k. This will help you gain what 15-20k or more a year? Worth it.

The wedding and honeymoon expenses shouldn't be that big.

Summary of your situation:

Assuming you probably take home about 3-5k a month?
You have 21.7k in savings.
You have 3.5k in precious metals at the bank.

You owe 2k on your Visa CC.
You owe 36k in student loans.

Consider too this post as to ways to get out and stay out of debt.

Hang in there you're going to be okay.

[Eagle]

Any tips, pointers, suggestions, etc. on the above six problems would be of substantial help. I don't know what I'm looking for really. I've researched this over and over. I just want a definitive solution.

To better understand your situation some questions:

Income & Expenses
1. So your yearly salary is about 75k-80k presently?
2. What is your monthly take home income?
3. What are your total monthly expenses?
4. Are you on a budget? www.mint.com is a great resource for tracking expenses.

Debt & Purchases:
4. What will be the total value of the student loans once you graduate?
5. What do you estimate you and your fiancé will be responsible for in the wedding and honeymoon expenses? (sounds like a small wedding and a honeymoon trip to Disney)

“The Talk” about finances with your partner:
6. Have you discussed finances at length with your bride?
7. Who is the spender and who is the saver in the relationship?
8. Why does your fiance only have 2k in savings?
9. What does her debt situation look like? What assets does she own?

[JoeP]

As you forecast making more money...do you also plan to revamp your spending habits? If not, then the problems you have now will only get proportionally worse with more money coming in.

[autoxer]

Thanks for the prompt replies. I have considered selling gold and silver to payoff my CC debt. It's just so hard to do, lol. I actually began buying that because I'm a prepper, and precious metals hold their value fairly well. I follow that market and would own more if I didn't have grad school expenses.

I have some of the same fears that would drive a 'prepper', but the more that I thought about what exactly I'm prepping for, the more irrational it seemed. I bought a few ounces of silver and then started thinking about how useful it would be. If we do have a monetary disaster (hyperinflation), then some other currency will eventually take the place of the dollar. Although silver may retain intrinsic value, how useful would it really be until a new currency is established? If you are prepping for some short term disaster, than you are better off stocking water, food and fuel.

If you are buying precious metals as an investment, then you should get out of debt first, because the appreciation isn't likely to outpace credit card debt.

I do want to clarify one thing on the laptop. I actually purchased an extended warranty on it for around $120, if I remember correectly, and since laptops seem to last me about 18 months it seemed like a prudent financial decision as the warranty will outlive my laptop track record.

Really?! My laptop is 7 years old. I just reinstalled the OS and replaced a speaker cable and it is running great again.

I think I overdid it on the ring as well, but it'll last a lifetime. I have insurance on it as well. I hope the wedding is cheap We're having it at her parent's house on the beach and only inviting parents and siblings so there'll be seven guests, lol. Disney World is the honeymoon destination! Historically we've been spendthrifts but lately the expenses keep piling up. My fiancee is a tax auditor, but even she's had trouble managing her finances as well lately as previously described.

Just venting as I slug away some late hours in my office. I'm a RN in case management.

That's good if you can keep the wedding/honeymoon expenses down. I was just concerned that you would have the attitude, 'Now that I'm a Reinvented Professional, I deserve a BMW.' When your income goes up, don't get sucked into blowing money like your colleagues.

[ReinventedProfessional]

Ha. I'm reinvented because I use to be a cop. Cops here make about $14/hr so I became a registered nurse and am becoming a nurse practitioner. I'm slowly inching my way up the income chain. FWIW, the ring expense is a first for me. Other than paying vehicle registration, in the past, I've never spent more than about $800 at any one time. And yes laptops crap out on me fairly consistently even though I'm careful with my possessions. I don't want to have to buy them twice, lol. With respect to prepping...I'm definitely prepared for disaster. I have a sizable food, water, hygiene, and health supply stock that we draw FIFO from so I believe I save money that way.

There are a lot of different perspectives shown here. Wow. Thanks for all the responses. I think in the end we'll be ok. I'm just ready to be there, paid off, and done.

Thank you.

[snafu]

I fully understand you're stressed out with so many high stress life changes and challenges heaped on your plate all at one time. Moving is a huge life stressor, 3 or 4 on the list. Changing employment is 5 or 6 on that list and changing career focus is over the top. Getting married is a huge responsibility usually number 1 along with reverse loss of partner. You're also a student with courses to add to the pressure. All those expenses dancing in your head all at once are difficult for 'saver' types. You're also stressing about fiancees issues of job, student loans, and investments.

This is not the time to make important decisions about investments, employer's retirement plan, ROTH or fiancees finances. This is the time to feel confident that you can handle all these life challenges. You need to enjoy this pre marital bliss, it's short term and you need to focus on pleasurable experiences. You will have years and years and years to deal with the issues you've outlined. I suspect your fiancee is in charge of wedding arrangements and it' your duty to respond with something like ..'yes dear, it's your day to have whatever you need to be happy/content.'

I promise SA posters will be here to make suggestions and discuss options to help you avoid missteps.

For example, must you rent a house? Would you do well to rent an apartment a reasonable distance from work? What are price differentials? This information should be available on-line. I suggest trying CraigList + city for an overview of the rental scene/cost. Can HR of new employer offer any information? Will/does Chamber of Commerce outline facts? Check your FICO score, you may be able to avoid deposit for utilities.
I ask this as a house adds responsibility for yard care on top of new marriage, new job, new colleagues, new friends, course work, different city etc.