- My Forums
- Tiger Rant
- LSU Recruiting
- SEC Rant
- Saints Talk
- Pelicans Talk
- More Sports Board
- Fantasy Sports
- Golf Board
- Soccer Board
- O-T Lounge
- Tech Board
- Home/Garden Board
- Outdoor Board
- Health/Fitness Board
- Movie/TV Board
- Book Board
- Music Board
- Political Talk
- Money Talk
- Fark Board
- Gaming Board
- Travel Board
- Food/Drink Board
- Ticket Exchange
- TD Help Board
Customize My Forums- View All Forums
- Show Left Links
- Topic Sort Options
- Trending Topics
- Recent Topics
- Active Topics
Started By
Message
re: Finances for Newly Wed
Posted on 4/30/19 at 8:03 am to blackoutdore
Posted on 4/30/19 at 8:03 am to blackoutdore
You have a lot of personal preference decisions to make.
The only thing I can advise for young married couples is to establish your monthly set expenses such that you can live on one salary. You never know when someone might get laid off but you also never know when someone might want to stay home if you have kids.
It is very sad for me personally to see a family that can't afford to have a parent stay home that really wants to. Your kids are so much better off when a parent stays home.
If you budget that way, you will have a LOT of discretionary budget to enjoy every month until someone does decide to stay home.
Take my opinion with a grain of salt. I'm an engineer so I'm naturally inclined to mitigate risk and protect the well being of folks. My level of acceptable risk is much lower than the finance folks.
The only thing I can advise for young married couples is to establish your monthly set expenses such that you can live on one salary. You never know when someone might get laid off but you also never know when someone might want to stay home if you have kids.
It is very sad for me personally to see a family that can't afford to have a parent stay home that really wants to. Your kids are so much better off when a parent stays home.
If you budget that way, you will have a LOT of discretionary budget to enjoy every month until someone does decide to stay home.
Take my opinion with a grain of salt. I'm an engineer so I'm naturally inclined to mitigate risk and protect the well being of folks. My level of acceptable risk is much lower than the finance folks.
3
Posted on 4/30/19 at 8:22 am to notsince98
quote:
It is very sad for me personally to see a family that can't afford to have a parent stay home that really wants to. Your kids are so much better off when a parent stays home.
I think the traditional, mom stays at home, days are dying.
Posted on 4/30/19 at 8:28 am to notsince98
quote:
is very sad for me personally to see a family that can't afford to have a parent stay home that really wants to. Your kids are so much better off when a parent stays home.
Not saying you are wrong but based on what? I have a kid in day care that is thriving. He’s a lot more developed mentally and physically than our friends kids his age that stay at home with their mothers.
Again, not saying you are wrong because mine is a very small sample size but I’d like to see a study or some evidence if you have it.
Posted on 4/30/19 at 8:36 am to TheWiz
quote:
I'm just saying, that seems like a shite load for rent.
Friend lives in Charleston and it's an expensive town, but even for Charleston $2,800 seems on the high end for a just a husband and wife. I would also suggest finding something cheaper to rent and putting that saved money towards the credit card debt.
Posted on 4/30/19 at 8:39 am to redfieldk717
quote:
I’d like to see a study or some evidence if you have it.
This article has links to several studies:
LINK
it starts off about some home schooling issues but it isn't just about home schooling. It covers everything.
Posted on 4/30/19 at 8:49 am to notsince98
Thanks, about to start trying for #2 so I’m interested in this stuff 
Posted on 4/30/19 at 8:49 am to TheWiz
quote:
TheWiz
Lots of good info. Ditto on Whitecoatinvestor
Congrats OP for being in this position this early in life. Your rental payment is pretty high so I would look to downsize that bill soon.
I would focus on 2 primary items at this point, debt and income. $250/yr is right near the bottom of the wealth curve. Even without debt, you're maxing retirement vehicles and paying your bills without much left over. It's easy to say, but get your income over $300k and you'll start feeling the difference. I think someone mentioned, catch the 401k match, crush those student loans (refi- when possible), and start saving money you can use now. Start having your money work for you so you can buy a house/wife open a practice. Physician loans can be great if you're going to be in the house a short term, but they often come with slightly higher interest rates or teaser terms.
As for the student loans, see if you can pay off portions at a time. My wife had around $180k and we broke them up, refi the highest interest and focused paying smallest to biggest balance (rates were all similar). Your monthly payments necessary go down over time which will come in handy as your family grows. Once we get down to 2 loans (roughly 80k) we may just pay the minimums until it's paid out. This is the flexibility we wanted we when chose this path.
$300k in debt is a bunch so paying it off will feel that much sweeter. Good luck.
Posted on 4/30/19 at 9:05 am to notsince98
quote:
This article has links to several studies:
LINK
it starts off about some home schooling issues but it isn't just about home schooling. It covers everything.
I just did a quick glance at the headlines. I saw benefits for the kid and links to depression for the mom staying at home. I'll have to read them later, but sounds like a mixed bag.
Am I getting the best of both worlds by having a nanny? Convenience, she takes him to different programs with kids every day, meals cooked at home for him, and he naps in his own crib daily.
Posted on 4/30/19 at 9:05 am to redfieldk717
quote:
Thanks, about to start trying for #2 so I’m interested in this stuff
You are very welcome! Good luck. 2 kids is awesome. 3 kids is a life changer but in a good way. I got 3 myself and we are done.
Posted on 4/30/19 at 9:47 am to blackoutdore
quote:Where are you OP
blackoutdore
You're on your way to being this guy!
This post was edited on 4/30/19 at 9:50 am
Posted on 4/30/19 at 10:07 am to blackoutdore
So doing some quick math at $140k each and assuming you each contribute $19,000 to a 401k....
Net Pay: +/- $7,400 x 2 = $14,800
Annual Net Pay $14,800 x 12 = $177,600
Less $12k to backdoor Roths = $165,600
Less $33,600 for $2,800/month rent = $132,000
Less $44,400 for $3,700/month Student Loans = $87600
Let's assume you spend $3,500/month on everyday stuff including a $300/month used car note, $200/month dining out, $600/month groceries. You may spend way more on those three things I mentioned. Just hypo. numbers.
Less $42,000/month for the above mentioned = $45,600 annual savings.
Less the unknown credit card debt ??????
You need to build up an emergency fund somewhere in the ballpark of $20,000-$30,000. Just going off of six to nine months of hypothetical living expenses for that.
You have some real opportunities to pay down the credit card debt very quickly, then pay off that car, and then pay off those student loans even faster.
Just looking at an amortization table, you could have your $200k loan balance down to $80k'ish by the end of 2025. I assume that you could and should have enough cash socked away by then to completely eliminate the student loans. Again, I don't know if you have $12k in credit card debt or $42k.
So by living like a "resident" "frugal couple" whatever you want to call it for a few years, you could have projected net income back north of $100k. That sets you up pretty nicely to save for that forever home. The ability to afford a nanny (that's $3,000/month
)for a hypothetical kid then and/or day care.
You guys are also going to need to explore different retirement vehicles, but definitely just focus on maxing your pre-tax and Roth IRA for now. Will you have other retirement options?
Net Pay: +/- $7,400 x 2 = $14,800
Annual Net Pay $14,800 x 12 = $177,600
Less $12k to backdoor Roths = $165,600
Less $33,600 for $2,800/month rent = $132,000
Less $44,400 for $3,700/month Student Loans = $87600
Let's assume you spend $3,500/month on everyday stuff including a $300/month used car note, $200/month dining out, $600/month groceries. You may spend way more on those three things I mentioned. Just hypo. numbers.
Less $42,000/month for the above mentioned = $45,600 annual savings.
Less the unknown credit card debt ??????
You need to build up an emergency fund somewhere in the ballpark of $20,000-$30,000. Just going off of six to nine months of hypothetical living expenses for that.
You have some real opportunities to pay down the credit card debt very quickly, then pay off that car, and then pay off those student loans even faster.
Just looking at an amortization table, you could have your $200k loan balance down to $80k'ish by the end of 2025. I assume that you could and should have enough cash socked away by then to completely eliminate the student loans. Again, I don't know if you have $12k in credit card debt or $42k.
So by living like a "resident" "frugal couple" whatever you want to call it for a few years, you could have projected net income back north of $100k. That sets you up pretty nicely to save for that forever home. The ability to afford a nanny (that's $3,000/month
)for a hypothetical kid then and/or day care. You guys are also going to need to explore different retirement vehicles, but definitely just focus on maxing your pre-tax and Roth IRA for now. Will you have other retirement options?
This post was edited on 4/30/19 at 10:14 am
Posted on 4/30/19 at 10:50 am to Oenophile Brah
(no message)
This post was edited on 7/15/21 at 8:22 am
Posted on 4/30/19 at 11:04 am to TheWiz
quote:
I just did a quick glance at the headlines. I saw benefits for the kid and links to depression for the mom staying at home. I'll have to read them later, but sounds like a mixed bag.
Am I getting the best of both worlds by having a nanny? Convenience, she takes him to different programs with kids every day, meals cooked at home for him, and he naps in his own crib daily.
The depression issue is very real but easily addressed when you know the deal. It is super critical for stay home parents to get involved in support groups ASAP. Once you find compatible friends with kids of the same age things get a lot better. You gotta have regular play dates and adult interaction. It is stay home parents that lose all contact with adults outside their house that really struggle with depression.
Posted on 4/30/19 at 11:04 am to blackoutdore
quote:
excluded all signing from projected incomes as well as my end of year bonus, which should be approximately $23k. I basically plan on using all of our signing bonuses to pay off as much of the CCs as we can.
Good plan.
quote:
Retirement - Presumably in the future, she will own her own practice after a few years of experience. We will be able to sell that practice in the future when retirement comes. Also as I understand it, there are specialized retirement options if you own a business, and you can add $56k per year to your 401k via profit sharing. With my 401k, that should get us to $74k per year of pre-tax retirement savings.
Also a good plan. You will need to research all of the ins and outs. There could be some opportunities for Solo 401k; however, she will probably have enough staff to phase her out of that. Still the $74k pre-tax is fantastic.
quote:
Rent- I'm aware $2800 is high, but it allows us to eliminate a car payment and will save us each 40min/day in commuting costs.
Can't argue this point. Sounds like you have thought it through.
quote:
Insurance: Still not a lot of comments on this topic. Any advice on life or disability insurance would be greatly appreciated.
I mentioned in my first post to check out Ameritas for Disability Insurance. They have some good options for high earners.
You both need 20-30 years of term at $1mm each.
quote:
White Coat: I'm familiar with the website, but I think they take some overly conservative assumptions. Wealth management is an optimization problem, and their base assumptions will get you 80-90% there. I'm hoping my finance background and the help of a good advisor can help us squeeze some more out of it than whitecoat.
Most of these guys are self-managing seven to eight figure portfolios, so don't feel like you need to dive into an advisor right away. If you insist on doing that, you are probably fine not having an advisor until your net worth is north of $1mm. A three or four fund portfolio, properly balanced, and consistently contributed to will get you well on the road to retirement.
This post was edited on 4/30/19 at 11:06 am
Posted on 4/30/19 at 11:41 am to TheWiz
quote:
I think the traditional, mom stays at home, days are dying.
Yep. I've worked full time, part time AND not at all. Part time for ME once the kids were in school (and even a little before) was good for me AND them. Fortunately we made it work -- my husband is a rice/soybean/crawfish farmer so if we can do it, others can figure it out as well.
A lot of it depends on the ability to stay home financially but also what drives the parent. Some women are work driven and would never ever in a million years be able to stay home. I'm "go to work a day or two a week, leave it there, go home, cook dinner and do laundry, play with the kids".
It really is an individual thing.
This post was edited on 4/30/19 at 11:47 am
Posted on 4/30/19 at 12:14 pm to TheWiz
(no message)
This post was edited on 7/15/21 at 8:23 am
Posted on 4/30/19 at 12:15 pm to blackoutdore
quote:
What is this wealth curve you speak of?
It's not official but it's basically the balance of additional income remaining after all retirement vehicles are maxed and standard bills are paid (things everyone would do first). With no children, it's lower then $250k/yr. The idea is prior to maxing all retirement vehicles, you're just going up in retirement savings rate but don't have any additional money to spend/save in brokerage. After you have maxed those vehicles, you have more disposable income and thus start feeling wealthy.
Posted on 4/30/19 at 12:21 pm to blackoutdore
quote:
Also as I understand it, there are specialized retirement options if you own a business, and you can add $56k per year to your 401k via profit sharing.
simple pension plan (SEP)
$56K is the maximum annual amount the company can contribute but you have to pay yourself $270K to reach it (its a % of annual income). all employees of the firm must receive the same % contribution
Posted on 4/30/19 at 12:42 pm to blackoutdore
$1mm is enough to pay off all your debts, invest, and grown it into something. You are high earners so neither of your are totally relying on one or another's income to survive.
Umbrella insurance: Get it now. It's like $700/year for $1mm. Add it to your auto policy. Super easy to do.
Umbrella insurance: Get it now. It's like $700/year for $1mm. Add it to your auto policy. Super easy to do.
This post was edited on 4/30/19 at 12:43 pm
Posted on 4/30/19 at 2:48 pm to TheWiz
quote:
Umbrella insurance: Get it now. It's like $700/year for $1mm. Add it to your auto policy. Super easy to do.
Maybe it varies by region but that seems high. My $1mm umbrella policy costs me $127/yr.
That is crazy it would vary so much.
Page 2 of 3
Popular
Back to top
Follow TigerDroppings for LSU Football News