Woot! 😀 It feels good to see that balance dropping again!
I got my last regular paycheck today from my old job. Because of all of my recent job drama, I’d been holding on to my cash for the last month or so instead of paying down my debt. My new job doesn’t start for another week, but I threw the money at the debt today out of sheer impatience.
I’ve been told that I should get one more check for unused vacation hours accrued this year. That check will go to the debt too.
New job financial pros and cons
In my last post, I mentioned that I wasn’t crazy about this job. Just focusing on the financials, there are some downsides.
- No bonus.
- No 401k match.
- No HSA available.
- My new pay rate is higher than the old job’s, but once you subtract lack of bonus, lack of 401k match, etc., it ends up being a wash financially. But, I get more money in each paycheck and accessible cash is what I need over the next 12 months.
- Um…. yeah… That’s about it.
Current Financial Priorities (next 12 months)
- Save up $2,000 Life Fund (Done!)
- Pay off debt
- Use money to cash flow career transition classes
- Beef up savings
Step 1: I plan to keep 2k or so in a ‘Life Fund’. This one fund will serve as a cash buffer and replace all my other sinking funds until the student loan debt is paid off.
Step 2: I’ve been asked if I will lower my investments in order to focus on debt. After much back and forth on my part, I’ve decided that the answer is yes. I will continue to max out my 401k no matter what, even though there is no match because it’s too important not to take advantage of the tax benefits especially given my new pay rate. I have, however, decided to suspend Roth IRA contributions and put that $500/mo toward the debt until it is gone. After the debt is gone, I will go back and max out the Roth IRA for 2019. This job does not offer an HSA, so any money that would have gone to that will also be diverted to loans.
A new spending plan is on the way. I will have more details on what I can pay each month once I get my first paycheck and see what money I’ll have to work with.
After student loan debt is gone, I’ll set up a different plan to detail where my money goes for the remainder of the next 12 months.
Student Loan, you should be afraid. Your time is almost up.
“Debtor’s prison is real, and opportunity cost is a bitch.” (DDSW Archives)
Wow! Look at you GO! It’s going to feel so good when you’ve got that debt under $20k next month!
It will! And I can’t wait. 😀
Girl! Your my shero, you’re rockin it!
Thanks, Cathy! 🙂
So excellent. I’m sorry about the lack of 401(k) match, but glad the pay rate is higher so you can make up for that. And just throwing as much cash as possible at the damn loan now that it’s so close seems just right. It will feel amazing to ditch it and be able to put your cash towards your *future* instead.
Absolutely, C. I can’t wait for it to be GONE.
You are almost in the teens! Woo-hoo!
Are you immediately eligible for 401K contributions? I’ve have a couple of jobs that made me wait to start contributions for a set period. One of those made me wait for 6 months before I could start using the 401K! I ended up doubling my usual contributions until the end of that year so I could still have the same total, but it was a stretch. I’m sure this would not have been possible if I were single, because we had my husband’s salary to cover our expenses. With a waiting period, it would make sense to use the Roth IRA and make extra payments to your loans until you become eligible to contribute.
Either way, I’ve been following your journey from the beginning… and I’m looking forward to seeing how far you will go without that crushing burden of debt. I’ve been truly inspired by your persistence and drive.
My understanding of the 401k at the new place is that my access starts the month after I start. So, supposedly that means July 1st. My first couple of paychecks or so that I get in June won’t have a 401k contribution taken out so I’m planning to use that toward the debt and make up the payments later to cover my missed June payments.
Sounds like victory to me.
So very close !
Yep. I’m in the final stretch. 😀
You are doing brilliantly and are so close to the end of your debt. I hope the new job goes well.
I really hope so too! Thanks, Jane.
This is so exciting, almost under 20k!
Indeed, it is!
Very best wishes with your new job. You’re like an Olympic marathon runner who has now entered the stadium and we are all cheering you on up to the finish line. I wish I could be present the day you get down to $0 debt.
Thanks for the roots and cheers from afar, Paul. 🙂