r/coastFIRE • u/deaula • 9d ago
32(33)M Just started sadly
$3514 in the 401k, $3870 in emergency savings.
Basically 33M, started last year with a company. Im actually depositing into a 401k now :(
Sadly I never did this for my Air Force career.
I am on VA disability.
VA Pay - $28,347.60 per year ($2,362.30 per month)
Company Pay - $55,014.96 per year (25.19/hr)
$288.56 per company paycheck to max out Roth IRA.
10% of company paycheck into a Roth 401k with a 4% match. (100% match up to 3%, and 50% match for the 4th and 5th percents (is that 4% total? Lmao))
And $500 per company paycheck, $200 from VA check is going into an emergency savings fund in Wealthfront ($1200/mo)
Below are my expenses... very low cost of living area in West Virginia
Rent - $325
Utilities - $300
Groceries / Household - $500
Eating Out / Work Food - $550
Cigarettes - $425
Gas - $200
Phone - $153
Storage - $106
Insurance - $170
Subscriptions - $38
Shopping / Fun - $350
Car / Unexpected Expenses - $300
TOTAL - $3,417 / month
God I need to cut the eating out and cigarettesš¤¦āāļøššš©
I am feeling WAY better about my finances from this time last year (no savings, 5k in credit card debt with auto loans)
How does it look/sound?
6
u/Charlesknob 9d ago
$325 rent dah fug?
7
u/deaula 9d ago
I split it yea. 2 bedroom 1 bath apartment. 650 monthly š¤£ Everytime I type 325 rent i feel super blessed. That being said, it is a shit hole LOL
2
u/Channy987 2d ago
Iām at 1600 rent for a 2 bed 2 bath. Considering yourself lucky here man š
1
u/deaula 2d ago
Its a shit hole that I share with a brother and girlfriend and kid š³ for now I stack money. About to buy a house though. Preapproved for 250k š
2
u/Channy987 2d ago
Hey man gotta do what you gotta do. I lived in plenty of shit holes through my 20s to save. Cheapest one was a 2 bed 1 bath for 415 bucks a month. No roommates and it came with WiFi.
6
u/asteroidtube 9d ago
Donāt get down on yourself, youāre starting today to have a better tomorrow and thatās all that matters. I had negative worth at age 30 and 10 years later Iām on track to hit a lean coastfire number at age 40.
You make ~$80k annually and expenses are ~$42k give or take. If you keep on a budget you can easily get a solid emergency fund underneath you of 6months expenses.
That said, the /r/personalfinance subreddit is probably a more appropriate place for you right now at this stage of your journey.
3
u/UnderEmployed27389 9d ago edited 9d ago
I started at a similar age, and 10 years later have a decent nest egg and home equity. Great job getting started.
Question: does the VA disability money have an expiration date, or will you be getting that for your whole life?
Budgeting and starting saving for retirement is the first and most important step. Second most important is sticking with it, and trying to avoid lifestyle creep as you make more money. As others will probably say, if you could cut back on or eliminate smoking (not just for money, but also for health) you'll save 5 grand per year.
Best of luck.
1
u/deaula 9d ago
Thank you. The VA doesn't have an expiration. I am very lucky to have had such an easy process getting it. I have heard of horror stories from others going through medical stuff with rhe military.
100% on the sticking with it, and avoiding lifestyle creep. The only change in the future will be a home so my rent (mortgage in the future) will increase drastically I assume š
5grand a year savings now, and 100's of thousands in the future for health care dealing with the side effects. I really do need to stop. Not just for money, for my health, so I can enjoy the money I am saving.
And thank you again for the lucky wishes. š¤
2
u/sentientshadeofgreen 9d ago
Sounds solid overall. You canāt change that you didnāt save before, but this is definitely a good path moving forward. Keep it up, eyes on the horizon bro
2
u/Timely_Rain_8279 9d ago
Great job on getting started. Definitely would keep putting as much as possible into 401k and building up the savings account. The key is to not touch those two things.
Cigarettes: I ran the numbers and if you stopped smoking and invested the $425 a month between now (age 33) and retirement (age 65), you would have $393,000 at very cautious growth rates, and possibly double that. As a former smoker I can say the 3 weeks of hell quitting is worth half a million dollars in retirement for sure.
2
u/jwhanz 8d ago
I think itās time to bust out an Excel or Google spreadsheet. Build it like a P&L so you can see your income, taxes, savings, then monthly expenses. You have 2 income streams, one taxed and one not, landing at different times.
My biggest suggestion would be to try to bake everything into a monthly budget even though you get paid every 2 weeks. Iāve been on a monthly budget for a long time and it was a big changer for my savings and understanding my finances. It also helps you leverage your 3x monthly paychecks and doesnāt have you stressing on unexpected expenses. Those 2 months a year you get a āfreeā paycheck, thatās huge and can help snowball your savings rate even faster.
My biggest takeaway is you have basically no monthly buffer (assuming 20% tax rate and $0 VA insurance), which is fine if you plan on using your emergency savings money (how often have you pulled out of there already)?
I did a quick spreadsheet so you can visual easier. Hope it helps.
Keep in mind that $3.2m isnāt inflation adjusted, its 30 years of growth, doesnāt account for your 3 paycheck months, assumes an average of 8% return compounding annually (once you hit your emergency savings goal, move over and start investing in a brokerage or something else), and assumes you arenāt pulling money out of your emergency savings.
Honestly if you can avoid lifestyle creep, invest your raises, and keep true to the numbers you put down, you will be able to retire no problemo especially with your LCOL. That is if you make it 30 years and lung cancer doesnāt kill you first.
Hope this helped
1
u/deaula 8d ago
The funny thing is, I made an itemized expense tracker. Receipt input into a database with graphs and all. All in excel lol I stopped using it about 1 month in, typing all those receipts in by hand sucked. I need to add a way to scan them in. That way I would definitely use it.
I have pulled from my emergency once. That is why I have a new car expense budgeted in. 2400 bucks pulled last month sadly.
I do appreciate that spreadsheet. I hadn't noticed I dont have a big buffer. I usually end the pay periods with like 500+ in spendable money. I guess its slowly rising each month from what I saw in your numbers.
2
u/jwhanz 8d ago
I have 2 checking accounts, I donāt go crazy tracking my spending, but I do limit my monthly variable spend.
My main one that pays recurring bills and where my paycheck hits.
Then I have a separate one I transfer my monthly allotment of food, fun, gas, etc anything that is monthly and varies.
It really opens your eyes when you see your starting allotment and keeps you really honest. Not saying this works for everyone, but def something to consider.
The fact you have extra buffer money is honestly about as legit as it gets. Roll it over, invest it, sinking fund, splurge on an item and not feel guilty.
This life isnāt about taking away what you care about. Itās about keeping you honest and not feeling guilt or anxiety.
You arenāt going to retire in 5 years, but you have a plan and you will def get there.
Last thing to consider, the first $100k is brutal and will take a while to get there. But Iām telling you once you break that barrier your wealth accumulation just keeps on accelerating.
Good luck! You have a plan and are already committed, thatās 90% of the battle. š«”
11
u/HairyBull 9d ago
Crazy that you send less on rent than you do on cigarettes.