Hello Everyone, I figured I would do an update from my post from last year. Although this post will come across as humblebrag, please note this is not my intention! It’s simply therapeutic for me to share with you all, and hopefully help others if they are in the same boat.
THE DEBT
This is kind of embarrassing, but in my initial post, my original debt amount was far higher than I reported. It was actually 440K federal+ 26K private. My apologies. I ended up paying off my 26k private loan much sooner than expected. The reason being is that as a variable rate loan, the interest rate double from 1.8 to a little over 3.6%. I decided that it would provide me with a piece of mind to just pay it off completely. The remaining debt is still consolidated, under the PAYE repayment program with average interest rate of 6.8%. Just to reiterate, I am also still enrolled in the Public Service Loan Forgiveness (PSLF) program as being in residency qualifies (3 years down, 7 more years to go). Although my organization is not a 501c3, it still qualifies since it is non-profit and provides public health services. I am still worried that this program will not last, but there remains the likelihood that current enrollees will be grandfathered in if it goes away. I believe October will be the first time any such loans will be forgiven under this program, so we'll see what happens. Again, I have no credit card debt, and pay off everything at the end of the month.
PERSONAL STUFF AND EXPENSES
Still not married and have no children. My paid off car now has 120k miles, and is still running great (although the brakes, rotors, and tire change expenses hurt a little). I have since discovered the benefits of "luxury" outlets, and decided to splurge by buying 4 high-end shirts for $100 :). I think I spent a grand total of $300 in clothing in the past year. Another shoutout to /r/frugalmalefashion! 2 major trips planned in the next few months, one to the west coast and another to Hawaii. However, airline tickets were free since I had points accumulated through my Southwest and Chase rewards credit cards (see /r/churning for more details).
I reduced expenses:
- I bought my own modem and router which have already paid for themselves, saving me an additional $7/mo in rental fees. My total monthly Internet bill is $30 total for 50/10, and was supposed to go up by $10 this year. I ended up calling my ISP and the representative was more than willing to keep me at the same rate. No cable.
- I did a little bit of research and decided to go prepaid for my cell phone plan, and went from $75 for unlimited talk, text, and 3GB of data to $55 for the same except with 10GB of data. I have the exact same reception, but with more data and saving $20 a month (no brainer, right??).
- My apartment building and workplace have free coffee, so that saves me another $20-30 a month.
- I recently paid for a Costco membership, and started to buy meat, toiletries, and other necessities in bulk. I’m still debating if this makes sense financially since I am single.
THE JOB
Slight salary bump after my hospital went from RVU based model system to comp based model. For the layman, this means I am basically salaried and no longer have to worry about meeting milestones to earn my pay.
THE BENEFITS/INVESTMENTS
- 403(b): fully maxed out
- Non-governmental 457: fully maxed out. I understand the risks, but I am willing to take a gamble that my hospital system is stable and not going to go bankrupt anytime soon.
- 401(a): employer contributed. I won't qualify until next year due to some odd rule that I need to work 1000 hrs per year before I am qualified. Since I started late last year, I didn't qualify for a contribution ¯_(ツ)_/¯
- Emergency fund: fully funded and spread out between 6 separate Ally No Penalty CDs. The reason I spread them out is because if I ever need to liquidate one of them, I can just close out each one as needed.
- Taxable brokerage accounts: Since my tax-sheltered accounts have been maxed out, I opened up brokerage accounts with Schwab and Vanguard. I like the option of having 2 competing companies, as both offer products at great rates. I may also open one with Fidelity as well.
THE PLAN FOR THIS COMING YEAR
- Continue with PSLF payments. I want to see what happens after October before deciding to continue with it, or re-financing at a lower rate with a private lender.
- Max out 403b, 457, and backdoor Roth IRA at beginning of 2018. Contribute remaining to taxable brokerage accounts with a goal to save a minimum of 35% of my gross salary annually.
- Start a custodian Roth IRA for nephew and niece, with the promise that I would match 50% of their contributions once their earned income hits 5500. Unfortunately, through no fault of my parents, financial education was lacking for my family…I want to make sure the next generation doesn’t make the same mistakes we made.
- Avoid lifestyle creep. Unfortunately, having friends in the same field means having friends who have started to splurge on cars and trips. The pressure is always there: “Dude you can buy a nicer car now”, “Why rent, you can definitely buy a really nice house?!”, “Lets go to dinner every Friday!”. I’m slowly trying to change them to see my point of view, but it’s difficult to change their opinions sometime. Ah well, I’ll keep trying.
As before, thank you for reading this admittedly very long post! Any suggestions, comments, or criticisms you can provide will be much appreciated!
Submitted August 13, 2017 at 10:57AM by NewDoc2016 http://ift.tt/2w0SQE9
