I was messing around in Mint and thought this graph of my assets, debts, and net worth over the last five or so years was interesting. I hope this helps someone else see how different scenarios can play out.
This graph begins around when I added all my accounts, including student loans, to Mint. I was working my first professional job at that point, making around $38k a year. My biggest indulgences were living by myself in a West Coast metro area (rent and utilities were about ½ my after-tax income for a while) and taking churning-supplemented vacations once a year.
All the debts are student loans from getting my bachelor’s and one 3-year car loan. The assets are a retirement account with automatic contributions and a savings account.
My biggest takeaways after reflecting on this graph and adding the annotations:
• Saving money and reducing expenses only goes so far when you’re not increasing your income, as I’m sure most of you already know. It’s amazing how fast I started paying off my student loans and saving up when I got a better paying job ($72k) in 2019. So don’t sweat the small stuff: get the name-brand ramen once in a while, and put that mental energy toward school and work.
• Living alone was a lifesaver for my mental health in my early twenties: I’m an introvert, a homebody, and I didn’t have any friends in the area looking to split an apartment. But was it really worth it after seeing what a big financial relief it was to split rent with my partner? Maybe. Just barely.
Now that I’m about to finish paying off my student loans, I’m hoping to start saving up for a downpayment on a house and contribute more toward retirement. My current expenses are roughly split 4 ways: ¼ to student loans, ¼ to savings, ¼ to rent, and ¼ to everything else.
Submitted April 24, 2020 at 04:54PM by NextSundayAD https://ift.tt/355f3j9
