Marriage soon, please help me prepare.

[skyl1]

Hi all, I'm 27 and have been working about 3 years now out of college. I'm looking to ask my girlfriend's hand in marriage soon and, if all goes well, I should be married within 1-2 years

With that I'll be seeing some changes to my situation, and would really appreciate any advice that I could get. I'm probably going to need to get a new car sometime in the next year or two since mine is on it's way out, and I'd like to start saving for a down payment on a house. That said, I don't have as much as I'd like saved for retirement.

As for my girlfriends financial situation, she's fresh out of college and isn't making a whole lot (~28k/year). She has 5K on an auto loan and about 25K in student loans. She also plans to return to school in the next year or so for grad school, so she can't really contribute much.

Here is my complete financial situation. I figure with my extra income, I could scrape together about $10K by the end of next year for a down payment on a mortgage if I didn't focus on anything else. I'd also like to knock out the 1K unsubsidized loan first if possible. One of my worries is that once I'm married and paying a mortgage, I won't have a lot left over for retirement and my retirement fund is low to be with. The student loans also bother me and I'd like to get rid of them if possible. I just don't think I have the cash to save for a mortgage, save for retirement and pay off all my loans. What's my play here?

Thanks!

CC Debt $0
Student loan $1K unsubsidized 6.5%, 11.5 subsizied 6%, 4K subsidized, 1.6%
(total $17K debt)

Cash $500
Savings $2K, 1% int (saving for a ring)
401K $3.5K, contributing the minimum 1K/year to get $500 matching
Roth IRA $1.5K, not currently contributing
(total $7.5K assets)

Monthly Income
Income $51K, age 27, single, no kids
(~$1400 biweekly)

Montly Expenses
Utility bills $120
Rent $330
Gym $20
Gas $175
Phone $60
Student loan $280
Vehicle ins $65
Food, other purchases, entertainment $840
Yearly Expenses (subscriptions, AAA, etc..) $67
Savings transfer $450
Vacation Savings $100
(total ~$2516)

[lindsay06]

That's a tough situation because you are pretty much spending what you are making every month. I'd try to cut down on areas like food / entertainment.

You know, it might make sense to wait a little bit until you are both a little bit more prepared. At least then you won't have to worry about missing any payments or building up debt.

Best of luck and congrats.

[sweetlady2k]

You also dont have to buy a house right away. I would live in a cheap apt. While shes going to grad school for sure while you have no children. You definitely will be struggling to save on your income. I would save as long as possible and hopefully after grad school her earnings will increase.

[bjl584]

I think that you are trying to do too many things at once. There will always be houses to buy. I'd keep renting while paying down your debts and saving for the wedding. And remember, a wedding doesn't need to be expensive to be a memorable experience. Keep things reasonable. Worry about a house later.

[cascade11]

Priority #1 would be to work on building up an Emergency Fund for a few years of 3-6 months worth of living expenses ($7,500-$15,000 based on your expenses) should you lose your job, get a serious injury, major car repair or new car, etc. I would focus on that before taking on the cost of an expensive wedding. Your food budget also seems very high. Eat out less and use coupons!

[snafu]

As others have explained at present your numbers do not support all that you'd like to do in the short term. As others suggest you need to work out a plan...perhaps for five years prioritizing goals. I too believe a good starting place is an Emergency Fund of at least 3 months expenses. There are good, worry free used cars as excellent buys with depreciation factored and paid by the original owner. Are you accessing all matching retirement funds from employer? Is it limited to $ 500.? Do you believe you will be paying for your wedding?

It's a lot to

[skyl1]

Thanks all for your replies! I'd like to mention that my gf's family will most likely cover the majority of the cost of the wedding, so I don't have to worry much about that. Also snafu, yes I'm accessing all the matching retirement funds I can (it caps out at $1000, for a total $500 matched).

I'm thinking a good used car would make the most sense in the future for when I need to switch off the one I currently own. Is that generally the cheapest and most economical way to go? I'd be willing to pay more for something newer if it would save me money in the long run.

I think my goals right now are to:
#1 save up for a ring
#2 establish an emergency fund
#3 pay off the unsubsidized student loan
#4 save a little for a replacement car
#5 save for a house