Almost 26 years old and looking for some financial advice please.

**Jluke** · 07-12-2020, 04:26 PM

What is the breakdown of each student loan?

include the balance and the interest rate.

Do you have a 401k?

do you have a Roth IRA?

have you ever read “If you Can” by William Bernstein? If not google it. It’s a free pdf online and it isn’t a long read. Read it at least twice.

**kork13** · 07-12-2020, 05:12 PM

You'll likely get alot of questions from various folks --- work through them, stick around, and we'll help advise you as best we can. Welcome to the forums!

My questions:
- How much would you be looking at spending on an apartment? Will you be getting a roommate to share costs? (I'd recommend doing so)
- Does your employer offer any sort of health insurance plan? You should look into the ACA marketplace. At your income level, ACA should provide an affordable option.
- What are you doing to increase your income? You need to really work on that issue. Just about any meaningful field out of college should pretty quickly start earning you at least $35k-$40k/yr, so I'm guessing you're not effectively using your degree right now?

Advice:
- Do some research & figure out what your estimated monthly expenses would be if you moved out & lived on your own. Also, estimate your one-time costs upfront (deposits, furniture/housewares, etc.).
- You need to build a budget for yourself, based on $2000/mo (worst case). Be sure to include rent, utilities (electric+gas+water+trash+phone+internet), transportation (gas+maintenance), insurance (renters+health+auto), groceries, debts, and savings. If you have anything left after those are covered, you can add some lines for entertainment, eating out, and so on.

Once you have those items sorted out, we can talk about what to do with your savings. You've done a great job to save that much while earning relatively little. We just need to make sure you use it for the right purpose, at the right time.

**ua_guy** · 07-12-2020, 05:41 PM

Refi your student loans as close to 0% as possible.

If your employer doesn't provide health insurance, find one that does. Don't under-value yourself. If you have to, buy a plan on your state exchange (ACA).

With whatever money is left, get out of your parents house. $13k in savings is a good start, but don't plan to spend it. It's called an emergency fund, now. Keep growing it when you can, and keep it in case something really hits the fan. Your next priority, so it seems, is saving for first/last and security deposits for rent. There is nothing quite like the experience of living under your own roof. If you can tolerate roommates, great. For me, that was too much like college. I wanted my own place, so that's what I did. My first place was a studio apartment. Living alone as a recent college grad, working full-time was...awesome. i could work, party on the weekends, and I always had a nice, clean place to come home to, everything exactly as I wanted it.

You've got the right mindset by asking questions here and being concerned with personal finance. I think you're going to do fine. Your first place on your own is a wild ride. Money will probably be tight. Keep playing bigger and better with your jobs and responsibilities at work. If you enjoy it and work hard, money will follow.

**bjl584** · 07-13-2020, 04:35 AM

Welcome!

I would look into roommates for an apartment.
Financially, good to stay at home
For Maturity and independence, good to move out

I would look into picking up side work if I were in your shoes.
Keep other debt to a minimum until the SL are gone or under control enough to refi

**Fishindude77** · 07-13-2020, 05:34 AM

I would move out and get out from under your parents roof as soon as possible, that is a big part of growing up and taking responsibility.
Split the rent on a cheap place with a friend if possible to save money.

Doesn't sound like very good income for a college grad. Look for new job opportunities to maximize your income (with health insurance), and seriously think about picking up a second part time job in the interim.
Most of us could work a lot more hours than we do.

So long as you have some decent transportation and a few thousand dollars stashed away for emergencies, I'd throw everything else at attacking the student loans and getting those paid off soon as possible.

Good luck !

**rennigade** · 07-13-2020, 03:36 PM

Just live with your parents for a couple more years and pay off your student loan debt. That's what everyone who graduates college does now. They live at home.

**Drake3287** · 07-13-2020, 05:35 PM

Originally posted by rennigade View Post

Just live with your parents for a couple more years and pay off your student loan debt. That's what everyone who graduates college does now. They live at home.

Exactly. My two daughters that graduated already still live at home but work full time. We live in the Bay Area with extremely high rents so I'd rather them stay here and save money vs wasting nearly all of it on rent. I also don't charge them rent (don't need the money either) as long as I know there saving for the future and simply not wasting it on clothes and going out every night partying. Suck it up for awhile and you'll be happy you did in the long run.

**bmk10** · 07-14-2020, 05:18 AM

Thanks everyone for your responses! I appreciate it.

I made some edits to my original post because there was a typo. I have 39K in debt and my student loan bills are $792.47

Some of you mentioned concerns about my income and what I am doing for more money. That is the biggest question I am facing right now.
Yes I received a 4 year degree but I'm not utilizing it. (Why? Multiple reasons. Long story short, I don't love the field I chose and would like to rework some things in my life)

So I'm fortunate enough to be working with my father as a plumbing apprentice. He is a self-employed plumber, however I do not see myself pursuing this as a career unfortunately.
As a result I've been working on career research, reading books, etc to determine what I want to do with my life (I'm sure that won't take long to solve!)

I do like the idea of working a part time job to bring in some more cash, I'm just not sure what. Perhaps I'll bartend part-time or something similar.

As far as moving out goes, I came up with some personal expenses. Some are concrete and others, well I am completely guessing...

Student Loans --- 792.47
Phone --- 75.00
Guitar Lessons --- 80.00
Gas --- 50.00 - 65.00
Groceries --- 160.00 - 200.00
Rent --- 350.00 - 500.00
Health Insurance --- unknown?
Savings --- ?

Renting expense is up in the air for me at the moment, there is a younger and more lively side of town nearby where I live now. Most apartments with 1 or 2 roommates will cost around $350-$500. I am currently working on finding people. I am just debating on which of my friends I wouldn't mind seeing nearly everyday. (highschool friends, vs recent friends, etc.)

I do not have a 401k or health insurance through work with my father. I did however open a Roth IRA with Vangaurd. I only have $100 deposited so far. I guess a new question for me would be how much should I start saving per week? per month? and where do I put it all? I was think about vanguard mutual funds... Because currently I have $4.5k in a savings account and another $8.5k in cash. In regards to investing I'm sure this is not the best move due to compound interest.

Some of you mentioned independence, responsibilities and personal growth comes from moving out. That is where my mindset is because I feel like I need some privacy, space and responsibilities. However as nice that sounds, I do not want to get stuck in a pinch paying these student loans for longer than necessary and wasting money on interest.

My loan details are attached below. There are quite a few of them.
The one with 0% interest rates changed to that when the pandemic started. So I have not been making payments on those loans since April. However they will be back to normal come this September.

Thanks again,
Brad

**bmk10** · 07-14-2020, 05:19 AM

Loans..

Attached Files

**Jluke** · 07-14-2020, 07:27 AM

I would payoff the 2067 principal and probably all 3 that are less than 1000 (bottom half of your screenshot)

edit: in case you see this I saw your question on Roth.

when I was at your stage I made myself contribute 150/month to my Roth.

I would invest in VTI and ignore the ups and downs of the markets. When you accumulate more than you can change it up as needed. But VTI at your age will hopefully prove to be very valuable

**ua_guy** · 07-14-2020, 09:34 AM

Here's what I'd do, but, I'm not you, so, adjust accordingly.

I'd pay everything I can towards the student loans. Those need to go, in order of the ones which cost you the most, to the least. If it makes sense to re-fi, do it.
I'd keep the $13k savings/cash and I'd keep it all in a savings account. This becomes your emergency fund/savings for when you move out. It's a great start.
I'd worry about retirement later, but it's something which should become a priority in the next couple of years. What you can put in retirement (IRA's have a $6k/year contribution limit), index funds aren't a bad way to go - but investing for retirement is another topic, a boat load of knowledge in and of itself. But what you can throw towards $6k year contribution, anything is great. 10-20% of your gross monthly income is a good goal to put away into retirement, once everything else is in order.

I don't think it's wrong to move out on your own even if it means slowing the repayment of your loans by a little bit. From an interest perspective, no, the fastest/cheapest way is to hunker down in your parent's basement while working, and pay them off ASAP. But, you are 26 years old, and it sounds like you WANT to move out to increase your satisfaction. There is also value in being independent, and gaining that experience, making the decision for yourself.

I could come up with some pep talk about finding the perfect career and doing what you love. It's a myth. I'm not saying you should become a plumber, certainly not just because your dad is. But you may not solve what you want to do for work--not that you should stop trying--but don't let it delay your life plans either. I struggled with career indecision too, and I've arrived at the conclusion (now almost 40) that my purpose in life isn't necessarily tied to my work. But my work does pay for the life I love. Keep that in mind for your own work adventures. I also have a buddy who became a plumber after going to school. He didn't grow up wanting to crawl under people's homes and snake drains full of ****. But he found he excels an an entrepreneur, owns his own business now, and loves the kind of schedule it affords him. Good plumber too.

**bmk10** · 07-16-2020, 03:20 AM

Originally posted by Jluke View Post

I would payoff the 2067 principal and probably all 3 that are less than 1000 (bottom half of your screenshot)

edit: in case you see this I saw your question on Roth.

when I was at your stage I made myself contribute 150/month to my Roth.

I would invest in VTI and ignore the ups and downs of the markets. When you accumulate more than you can change it up as needed. But VTI at your age will hopefully prove to be very valuable

I would invest in VTI and ignore the ups and downs of the markets. When you accumulate more than you can change it up as needed. But VTI at your age will hopefully prove to be very valuable [/QUOTE]

I agree in rergards to the loans. Get rid of a few of the smaller ones and the one at 7% interest. It would drop my monthly payment a little as well.

I think I'll look into a VTI fund as well and set up a monthly payment towards it. That's what my father keeps recommending for me as well.
Thanks! I appreciate it

**bmk10** · 07-16-2020, 03:34 AM

Originally posted by ua_guy View Post

Here's what I'd do, but, I'm not you, so, adjust accordingly.

I'd pay everything I can towards the student loans. Those need to go, in order of the ones which cost you the most, to the least. If it makes sense to re-fi, do it.
I'd keep the $13k savings/cash and I'd keep it all in a savings account. This becomes your emergency fund/savings for when you move out. It's a great start.
I'd worry about retirement later, but it's something which should become a priority in the next couple of years. What you can put in retirement (IRA's have a $6k/year contribution limit), index funds aren't a bad way to go - but investing for retirement is another topic, a boat load of knowledge in and of itself. But what you can throw towards $6k year contribution, anything is great. 10-20% of your gross monthly income is a good goal to put away into retirement, once everything else is in order.

I don't think it's wrong to move out on your own even if it means slowing the repayment of your loans by a little bit. From an interest perspective, no, the fastest/cheapest way is to hunker down in your parent's basement while working, and pay them off ASAP. But, you are 26 years old, and it sounds like you WANT to move out to increase your satisfaction. There is also value in being independent, and gaining that experience, making the decision for yourself.

I could come up with some pep talk about finding the perfect career and doing what you love. It's a myth. I'm not saying you should become a plumber, certainly not just because your dad is. But you may not solve what you want to do for work--not that you should stop trying--but don't let it delay your life plans either. I struggled with career indecision too, and I've arrived at the conclusion (now almost 40) that my purpose in life isn't necessarily tied to my work. But my work does pay for the life I love. Keep that in mind for your own work adventures. I also have a buddy who became a plumber after going to school. He didn't grow up wanting to crawl under people's homes and snake drains full of ****. But he found he excels an an entrepreneur, owns his own business now, and loves the kind of schedule it affords him. Good plumber too.

You hit the nail on the head. I have definitely been guilty of delaying my life plans. Part of me has been sitting around waiting to find the perfect career before I move out so things are "easier". I totally agree because if I choose that path, well I may not move out until my 30's or 40s lol. Plus I'm just delaying that opportunity to feel independent and take on some responsibilities. Which is what I really need right now.

I have two options in regards to apartments..
1) With a friend at $450/month with a month-to-month lease
2) with 2 friends at $350-400/moth with a 1 year lease.

Similar options so I may debate these and then make a decision. At the same time I can knock a few loans out, set up a monthly expense to start saving/investing and set up my emergency fund.

Thank you for your advice!

**Like2Plan** · 07-16-2020, 04:51 AM

Originally posted by bmk10 View Post

I think I'll look into a VTI fund as well and set up a monthly payment towards it. That's what my father keeps recommending for me as well.
Thanks! I appreciate it

I have to laugh about this. Sometimes advice from parents doesn't sound as awesome as what you would get from your peers (or for that matter an anonymous internet message board), but anyway it sounds like your father is a smart man.

Almost 26 years old and looking for some financial advice please.