It's been over a year...update and feedback time

[Eagle]

Actually, I have the full support of my partner for the hobby.

While I do consider it {video games} a hobby, that's only because I keep a fair share of what I find/collect. However, if I transitioned into a sole seller, it would turn a small to medium profit each month.

Okay if your partner is good with it then that's cool then.

Re: sole seller... Something to consider while getting out of debt.

[Eagle]

1.) Thank you.

2.) No I actually bring home a 12 month avg. of $5500/mo. Sorry if what I wrote was confusing. I get paid in 26 paychecks annually from job #1. Job #2 is $550-725 per week or usually about $2500/mo. So usually it's about $5200-5300 and then the two months I get 3 paychecks it's over $7k.

3.) I'm currently spending $1600 on rent and around $200/mo on utilities + an increase gas cost due to distance. Total cost per month of the condo is $1760 and a decrease in around $50-80 in fuel cost.

4.) No, that was just bad history with car buying where I kept rolling car into car into car....working on it...

1. It's great you are figuring all this stuff out in your mid-20's. Many people don't start getting serious about their finances till their 30's, 40's or later on in life.

2. Ah okay makes a lot more sense about your income then. So you have a great income stream.

3. So you're spending $1800 a month renting and it would cost about $1760 to buy (plus the benefit of being closer to work to save on fuel). Have you factored into the equation spending 1-2% of the value of the home in maintenance yearly?

4. Ah okay. Well keep it up! Keep moving forward! You can do it!

5. Did you get the idea of net income? I agree with another poster it is possibly the best way to look at your assets and debt.

[Vpxggmr17]

1. It's great you are figuring all this stuff out in your mid-20's. Many people don't start getting serious about their finances till their 30's, 40's or later on in life.

2. Ah okay makes a lot more sense about your income then. So you have a great income stream.

3. So you're spending $1800 a month renting and it would cost about $1760 to buy (plus the benefit of being closer to work to save on fuel). Have you factored into the equation spending 1-2% of the value of the home in maintenance yearly?

4. Ah okay. Well keep it up! Keep moving forward! You can do it!

5. Did you get the idea of net income? I agree with another poster it is possibly the best way to look at your assets and debt.

3.) Yes, it's why I've allocated about $50/mo to build a slush fund specifically for things that could arise in the Condo. Regarding maintenance of things related to piping, heating/air or the exterior, all of that is management's responsibilities in the HOA, etc. So if I have an appliance break, or damage a wall, etc then that would fall under my responsibility.

5.) I think I fully understand net income/worth. This being my first home buying process, I'm learning a ton about the process not just from the buyers perspective, but all that goes into selling as well. This entire time I've been factoring in the notion that if it's this much work/cost to buy, it's equally as much to sell, so factoring in that cost in the property value makes total sense.

[riverwed070707]

For example, by age 35, Fidelity suggests that you should have saved 1X your current salary, then 3X by 45, and 5X by 55. “Setting up clear goals linked to your salary can help simplify your planning, and help you determine if you are on track throughout your working life,”


I personally find Fidelity's recommendation too conservative, but its a decent baseline.

You think 1x salary by 35 is too conservative?? I've always heard 1x salary by 30 and I'm aiming for 1.5 But then I'd like to slack off and do some adventure travel for a while while my investments grow so I guess its just a different strategy with the same endpoint.

[autoxer]

You think 1x salary by 35 is too conservative?? I've always heard 1x salary by 30 and I'm aiming for 1.5 But then I'd like to slack off and do some adventure travel for a while while my investments grow so I guess its just a different strategy with the same endpoint.

Yeah, that Fidelity suggestion is great if you want to work 9 to 5 until you are 65. I'm also aiming much higher than that. My goal is financial independence by the time I turn 50, so my interim goals are 1x at 30, 3x at 35, 6x at 40, 9x at 45, 13x at 50. If the OP can hit the 41% savings rate, that he is shooting for, he'll be ahead of this curve.

[bjl584]

You think 1x salary by 35 is too conservative?? I've always heard 1x salary by 30 and I'm aiming for 1.5 But then I'd like to slack off and do some adventure travel for a while while my investments grow so I guess its just a different strategy with the same endpoint.

I've heard 1 to 1.5 X by 30 as a general guideline.

[Gailete]

Well one of the things that really grabbed my attention was your mention of possibly getting another credit card to buy furniture. Are you sitting and sleeping on the floor now? Do you own what furniture you have? Then use it and save until you can afford each piece that you want to buy. There is no reason to go into debt for new furniture just because you bought a new place to live. Or use some of your savings to buy what you need.

You seem to have enough in savings to pay off several of your bills, which is what I would do. The 'gift' of money from your dad which you have to pay back, you may have convinced the loan officer that it was a true gift, but in reality it appears to be a loan. Just as I suspect the reason you only get paid a certain amount by employer in job 2 is so low but your claim it is bringing in $30K/year. No waiter can earn that much on $4/hour without the tips and tips ARE taxable as well. Just because you like to creatively label things, doesn't make it so.

[Vpxggmr17]

Well one of the things that really grabbed my attention was your mention of possibly getting another credit card to buy furniture. Are you sitting and sleeping on the floor now? Do you own what furniture you have? Then use it and save until you can afford each piece that you want to buy. There is no reason to go into debt for new furniture just because you bought a new place to live. Or use some of your savings to buy what you need.

You seem to have enough in savings to pay off several of your bills, which is what I would do. The 'gift' of money from your dad which you have to pay back, you may have convinced the loan officer that it was a true gift, but in reality it appears to be a loan. Just as I suspect the reason you only get paid a certain amount by employer in job 2 is so low but your claim it is bringing in $30K/year. No waiter can earn that much on $4/hour without the tips and tips ARE taxable as well. Just because you like to creatively label things, doesn't make it so.

On the notion of the furniture, I have a very minuscule amount due to previously having little space. Also, now that I'll care a little more about the upkeep of the place since I own it I don't want things like my awful bed on wheels tearing up my new flooring, etc. I have no bed set and have pretty much nothing for a living room, so getting a sofa/bed set was the only thing on my list to buy.

Second, the checking/savings looks high, but it's inflated WITH that $17,000 still in there that will soon be used as the down payment/appraisal/moving/etc.

Lastly, I never said I earned $30k on $4/hr w/out tips. I am of course required to "claim" my cash earnings but I take my cash that day home with me. Cash claimed + hourly is that $30k. I never labeled it anything outside of that.

[Eagle]

You think 1x salary by 35 is too conservative?? I've always heard 1x salary by 30 and I'm aiming for 1.5 But then I'd like to slack off and do some adventure travel for a while while my investments grow so I guess its just a different strategy with the same endpoint.

At 32 we have 2.26 x our household salary. I agree 1x by 35 is way too conservative.

Yeah, that Fidelity suggestion is great if you want to work 9 to 5 until you are 65. I'm also aiming much higher than that. My goal is financial independence by the time I turn 50, so my interim goals are 1x at 30, 3x at 35, 6x at 40, 9x at 45, 13x at 50. If the OP can hit the 41% savings rate, that he is shooting for, he'll be ahead of this curve.

3 x by 35 is a good goal. Retiring at 50 is an aggressive but good goal too.

[Eagle]

Actually, I have the full support of my partner for the hobby.

A thought just occurred to me re-reading your thread.

Question: does your partner live with you? Will he or she be paying some of the bills as well?

[riverwed070707]

On the notion of the furniture, I have a very minuscule amount due to previously having little space. Also, now that I'll care a little more about the upkeep of the place since I own it I don't want things like my awful bed on wheels tearing up my new flooring, etc. I have no bed set and have pretty much nothing for a living room, so getting a sofa/bed set was the only thing on my list to buy.

Second, the checking/savings looks high, but it's inflated WITH that $17,000 still in there that will soon be used as the down payment/appraisal/moving/etc.

Lastly, I never said I earned $30k on $4/hr w/out tips. I am of course required to "claim" my cash earnings but I take my cash that day home with me. Cash claimed + hourly is that $30k. I never labeled it anything outside of that.

Woah woah woah, so the $17k is somewhere included in this breakdown of savings you indicated? So when you said:

I had $17k cash/retirement and $31k debt this time last year. Now I have $31k cash and $26k debt.

your $31k cash includes your $17k loan, meaning you really have less in savings than you did a year ago? I'm going to say one more time just for good measure in case there is an inkling of a chance it might absorb: you have some bad spending habits here you really need to sort out.

Also -- if you don't toss this terrible idea of buying the condo -- ditch your "new house deserves nice new furniture" attitude and buy yourself some used stuff with cash to get by until you've actually saved enough to pay for it. Seems to me like you haven't learned anything since your first mistakes of getting into debt. Buying new furniture because your house deserves something nice is no different than buying a car off the lot because you think buying used won't last as long and is therefore more expensive. Newsflash, that simply isn't true no matter how you dice it.

[bigdaddybus]

You think 1x salary by 35 is too conservative?? I've always heard 1x salary by 30 and I'm aiming for 1.5 But then I'd like to slack off and do some adventure travel for a while while my investments grow so I guess its just a different strategy with the same endpoint.

Yes, IMO the Fidelity recommended percentages along with Social Security will keep a person from going hungry in retirement, its not exactly a plush retirement, but much better than most in society save.

[riverwed070707]

At 32 we have 2.26 x our household salary. I agree 1x by 35 is way too conservative.



3 x by 35 is a good goal. Retiring at 50 is an aggressive but good goal too.

I guess I would interpret conservative to mean more than what's needed. Like if you give a conservative quote, it's generally higher than what you think the cost will be. So if you are giving a conservative savings goal, it would be higher than what you probably actually need? But maybe I'm misinterpreting the terminology. Regardless, I think we're all on the same page that you should have more than 1x by 35.

[Vpxggmr17]

A thought just occurred to me re-reading your thread.

Question: does your partner live with you? Will he or she be paying some of the bills as well?

Yes we live together. Currently he's in school and focused on that. He handles all the stay at home responsibilities and I provide the support. That will obviously change once school is over with.

[Vpxggmr17]

Woah woah woah, so the $17k is somewhere included in this breakdown of savings you indicated? So when you said:
your $31k cash includes your $17k loan, meaning you really have less in savings than you did a year ago? I'm going to say one more time just for good measure in case there is an inkling of a chance it might absorb: you have some bad spending habits here you really need to sort out.

Also -- if you don't toss this terrible idea of buying the condo -- ditch your "new house deserves nice new furniture" attitude and buy yourself some used stuff with cash to get by until you've actually saved enough to pay for it. Seems to me like you haven't learned anything since your first mistakes of getting into debt. Buying new furniture because your house deserves something nice is no different than buying a car off the lot because you think buying used won't last as long and is therefore more expensive. Newsflash, that simply isn't true no matter how you dice it.

I'm really curious, and this honestly goes for anyone on here to answer. Explain to me the difference between spending $2000 cash for something or $55/month interest free.

I never said anything about ANY of my credit card "debt" or the potential of this third card have ANY interest associated with it. So I'm just curious, why is there such a stigma against paying for something on a monthly basis versus a lump sum up front when the total amount is not a cent different.