Two month (and change) check-in

The job change has had me more scrambled than I expected! I'm loving the new role, even though the commute is still pretty rough. (Hurray for audiobooks from the library!) 

I've not been doing my monthly check-ins mostly because I thought I didn't have online access to my old 401(k). (Turns out I did have access, and I was finally able to initiate the rollover on it this week! There was about $2k not vested, but I don't think my mental health was worth sticking around just to vest that extra 40% of the company contribution.) 

I was also finally eligible to sign up for the 401(k) at my new job - I thought it was 90 days, but it was actually after three months with one hour of service, which was July, August, and September - so I'm signed up as of October 1! My first deduction will be on this coming Friday's paycheck. We have access to both a regular and a Roth 401(k), so I spent some time waffling on which to put my 4% into (salary match is up to 4% - I'll increase it once I pay off my credit cards). I asked my brother his opinion, because I was leaning toward splitting the difference, and he suggested to just put it all in the 401(k). I decided to do that because I believe I'll be in a lower tax bracket once I retire, plus I appreciate the lowering of my current tax bill.

One of the other things distracting me was trying to figure out how and when to move. I need to make some cosmetic updates to my current place in order to sell it for the best price, and I have too much crap in general. I debated between a personal loan and just saving up for a few months, and finally decided my credit score can't take the hit of a new loan if I want to get a good interest rate on my next place. So I reworked my budget, and all of the money above my credit card minimum payments is now going to be diverted to a savings account (~$1,100, plus another $265 from my still deferred federal student loan payment). I should have about $7,500 saved by the time I ready to pull the trigger in about 5.5 months. (Side note: I have enough equity in my current place that even after my next down payment, I'll have enough money to pay off my credit cards immediately.)

An upside of waiting means I have more time to declutter my place. I'm still determined to work on it daily, but it doesn't feel quite so overwhelming with the longer timeframe. I can also maybe do some of the cosmetic upgrade stuff myself, like painting and some minor repairs. 

A downside is that my credit utilization is still a bit high - it's currently sitting at about 41%, and ideally should be 35% or less. Aaaand I just fixed that by requesting credit limit increases on three of my balance transfer cards - one was approved for a $4k increase and two for a $2.5k increase. Love technology! That puts me at just a touch over 35%, which will decrease further when this month's payments hit. The increases should also help with those individual cards' utilizations as well. 

The final thing I need to do is switch my daily spending to a card with a higher limit - the current card's limit is only about $2.2k, and I usually spend about $1.5k per month on it. I have another card with an $8k limit (Chase Sapphire) that will work much better. I like the $2.2k card because it's Southwest Airlines-branded, but the $8k card has Chase Ultimate Rewards, which can be transferred to Southwest if I want. I've requested some of the credit line from my Chase Amazon card be transferred to the Southwest card, but I'll still move my recurring payments to the Chase Sapphire card. (Why am I not requesting credit line increases from Chase? Because their FAQ says I have to send a secure message with the amount I want to increase, and that they're going to pull my credit report to evaluate the request. Hard pass, given my future mortgage application!)

My Experian FICO score yesterday was 721. Wells Fargo's FICO 9 score says 699 as of 10/1. I want to get up to 760 or better by the time I apply for my next mortgage. The WF details say that I have too many inquiries in the last year, but the only hard inquiry I'm aware of is from applying for my latest balance transfer card in April. (I checked my credit reports yesterday - I stupidly got distracted while getting the last one and the session timed out and wouldn't let me re-access it. Luckily during the pandemic we have access to our free credit reports weekly, so I'll do a better job next weekend getting all three.)

This feels like a good stopping point for now. I'll try to put together a September net worth update shortly!

Two weeks' notice

Well, I did it. Last week I put in my two weeks' notice. It was bittersweet - my job has been insanely stressful (my blood pressure has been creeping up the last two years), but I really love (almost) all the people I've worked with. And as I mentioned in my last post, they had been very pleased with my performance (even though I personally don't think I was working up to my potential). I've been ready to move on, though, and hopefully to a position with less stress.

Where am I going? I got a job in an industry I'm very excited to be joining. It's a pre-IPO start-up doing some amazing things. They met my salary ask without negotiating me down (I had intentionally over-asked assuming they would), and I'm getting stock options. They also agreed to let me have a week off about one month in (vacation doesn't usually start until 90 days out) in exchange for me starting on the earlier of their two proposed starting dates.

However... I messed up a bit. I didn't negotiate to cover the bonus from my soon-to-be-former job, and when my old company mentioned a retention bonus, I didn't get a number from them to take to the new job. Live and learn! I was very ready to just get everything over with. Sadly, this means I won't be paying off my credit cards as soon as I wanted/expected, but the pay increase I'm getting will be going toward my credit cards. My current projection is that they will all be paid off by the end of June 2022, but I'm making a lot of guesses about my net pay and budget with the new job. 

Another minor bummer about the new job is that it's on the opposite side of town from me, which means I'll have a heck of a commute. Luckily, I love audiobooks, and once I get past downtown, it will be a reverse commute. My gym has a location on that side of town as well, so the tentative plan is that I'll go work out after work, which will give traffic time to die down. I had offhandedly mentioned an off-peak schedule to the hiring manager on my way out from my interview and he didn't immediately shut that idea down, so that could be a possibility as well.

I am considering moving to that side of town next year, if the commute really gets to me. My condo is enough of a disaster that I wouldn't be able to get it on the market in the next couple of months, and if I moved now, my housing expense would basically double, which would cut into my credit card repayments. A one-year delay, though, gives me plenty of time to declutter and make necessary updates (new flooring, for example) without having to stress too much. Even if the housing market cools off, I should still make a tidy profit on this place.

Current job update

Well, apparently I hate my job but it doesn't hate me. I had my annual performance review last week and hot damn was it good. (My company's fiscal year ends June 30, hence the mid-calendar year review.)

During this pandemic, I have definitely not felt like I was doing my best work. I love working from home, but I need a little more accountability than I currently have. Apparently though, I'm still doing well enough that I was ranked in the highest bucket (now three out of my four years), which resulted in a 17% raise (which brings me up to the salary I've been asking for in interviews - time to up that number!) and a TWENTY-THREE THOUSAND DOLLAR bonus.

Sorry about the all caps, I'm just unbelievably stoked about that number. I've never had a bonus that large before - I think $5k for professional licensing was the biggest bonus I've ever gotten previously. Last year's bonus was just $3k.

I have a relative who works in HR who told me that I can negotiate for a signing bonus from any companies in the offer phase to still get that amount of money even if I leave before the bonus is paid out (which would be September 30, presumably to keep people from quitting). 

Based on my last bonus's withholdings, I'll net about 2/3 of the gross amount, roughly $15.5k. Even that amount of money is staggering to me. I've already figured out that at the time of payout, the bonus amount would be enough to pay off the rest of my credit cards entirely and leave me about $1,500 to do with what I wish. 

Y'all, I know not to count my chickens before they hatch, but I'm already so relieved at the idea of having my cards paid off a full year earlier than expected. At my current rate, it was looking like June 2022 for full payoff. Once my cards are paid off, I can finally start saving heavily for early retirement and travel and all of the fun things I've been avoiding because they're too expensive (like scuba diving!). 

Next credit card to pay down: Chase Sapphire

The Chase Sapphire card is the next victim on my credit card paydown list, with an interest rate of 15.24% (the same as the Amex I just paid off - I basically flipped a coin on which one to pay first). As of two days ago, it has a balance of $7,566.89, including the previous billing period's interest. 

Here's how I'm dealing with it: Balance transfers! I qualified for a new credit card from Citi (Citi Preferred Diamond) with a $4,100 credit limit, and also finally realized how I could get a new balance transfer on an existing Citi card I already have (Citi Simplicity, $2,700 limit). 

The Simplicity transfer processed two days ago as well, so my current balance is $4,945.53 (there was also a 3% transfer fee). I have to pay the Simplicity card by March 1, 2022, so I plan to pay $270 per month for the next 10 months.

I'm waiting for the Preferred Diamond card in the mail still, which I think is why the transfer hasn't processed yet. That one will bring my balance down by another $3,980ish (I'm not sure of the exact amount) to under $1,000! This card has an 18 month 0% period, so I'm going to be paying $227.75 per month on it. I expect to be able to pay it off by June 2022, because at that point everything else should be paid off! 

I'm currently budgeting $1,315 for credit card paydown (ugh, I hate that number), plus $265.78 from my federal student loans. It's being allocated as follows:

Card	Monthly payment
Chase Sapphire	$231.80
Chase Freedom	$50.00
Chase Amazon	$110.00
Wells Fargo CC	$82.00
Discover BT	$500.00
Citi Preferred BT	$227.75
Citi Simplicity	$270.00
Affirm	$109.23

(Affirm is due to be paid off in May, at which point that money will be reallocated to the Chase Sapphire.)

The remaining Chase Sapphire balance will be paid off by July! (I'm counting it as paid off even though most of the balance has been transferred to 0% BT cards, because then it's no longer accruing interest and digging me in deeper.)

After the Chase Sapphire is paid off, next will be the Chase Freedom, which should only take a couple months given that it's a relatively low balance (currently only about $1,000). The Discover BT will also be paid off at the same time as the Freedom. (The Discover balance was previously on the Marriott Amex.) 

I'm really excited, I finally feel like the end is in sight for this damn credit card debt. It's been hanging around my neck since I graduated grad school at the end of 2016, and I'm finally in a financial spot where I can make significant progress with it.

My credit card debt problem and my plan to solve it

So, as I mentioned in my introduction post, I have a little problem left over from graduate school - credit card debt! It's currently sitting at about $24k, broken down as follows:

Card Name	Card Balance	Interest Rate	Minimum Payment	Expected Payoff Date
American Express	$2,291.53	15.24%	$80	April 2021
Discover (Balance Transfer)	$3,999.59	0.00%	$500	September 2021
Chase Sapphire	$7,813.70	15.24%	$185	November 2021
Chase Freedom	$1,133.04	14.99%	$50	December 2021
Chase Amazon	$4,799.42	13.24%	$110	March 2022
Wells Fargo Visa	$3,734.68	11.15%	$82	May 2022
Total	$23,771.96

(This doesn't exactly agree to my introduction because I also have a credit card that I use for my everyday spending and pay off every month that was included in Personal Capital's grouping.)

I am currently putting about $1,000 a month (my budget says $1,135, but I also have a small loan with Affirm that is getting paid out of that envelope at about $110) towards my cards. I also just pulled the trigger on decreasing my 401(k) contributions down to the minimum to get my employer match - that should give me about $230 extra per month to throw at my debt. I’m not sure when that will come into effect - I doubt this Friday’s paycheck (last day of month on a weekend = getting paid the Friday before), so probably the 15th. I really hated to do it, but the extra money will cut about four months off my payment time, and that was sufficient motivation to do it. I’ll crank up my savings again after I pay off all my cards.

The Discover card is a balance transfer card - it actually has two different transfers on it, both from the American Express. The first one ends September 2021, and in theory the second one ends December 2021, but I'm not 100% sure on how they're applying the payments, so I'm planning to pay the whole balance off by September 2021 so as not to risk any back interest.

I really appreciate balance transfers - they're really helpful for paying down debt as long as you pay it off before the BT period expires.

FIRE in the Heart of Texas: An Introduction

Hello there! I'm Tex (as I'll be known around here), and this is my new blog, FIRE in the Heart of Texas.

Who am I? I'm a 30-something woman living in Austin, Texas, with a goal of retiring as soon as possible. I've been obsessed with personal finance for at least a decade now, but when I went to grad school in my mid-20s, I racked up an unfortunate amount of consumer debt and some student loans. Currently I'm working as an accountant, but my dream retirement job is to own a craft shop. I'm single with no kids, and I don't see that changing any time soon - sure, there's a pandemic, but I also just don't date very much, if at all.

What do I think I'm doing right? 

• I'm contributing more than enough to meet my company match (it's a terrible match - they match 25% of what you put in up to 6%, so 1.5%) to my 401(k). I'm currently contributing 10%, and I increase my percentage each time I get a raise.
• I've had a Roth IRA since I was 19 or 20. I haven't been able to contribute to the Roth since my early 20s, and I took out some contributions (tax- and penalty-free!) to cover a down payment on my condo, also in my early 20s, but it's still growing every year. 
• The condo's another thing I did right - I bought it at the "bottom" of the market in Austin in 2011 (sarcasm quotes because prices have never not been crazy in this town), and the value has at least doubled since then. (When people start getting nosy about my finances, I tell them I live in my wealth.)
• I don't eat out often or go shopping recreationally.

What have I done wrong? 

• The aforementioned consumer debt is probably the biggest - I believe the all-time high was $28k, and it's currently around $24k, but shrinking every month. (I'm using the debt avalanche method - post to come - and my two highest interest rates also have the highest balances, which is disheartening, but I balance-transferred half of one to a 0% interest card to be paid off before the interest-free period expires, and the other half of the same card will be paid off in six months. Then eight months after that, the second highest interest rate will be paid off.) 
• I had to buy a car when I was in grad school (I could not take the bus or bike), and I took out a loan with my national bank (who I've been using since I was 17) because they weren't going to check my income (the need for the car came immediately after I had been off work for two weeks, one visiting friends and one taking care of an ill family member). The interest rate was 5.375% and I went with a 60-month-loan (I can hear PF experts groaning). The car note will be paid off this year, at which point, I'll start transferring the same amount to a savings account to serve as the down payment/full payment for my next vehicle (fingers crossed my current baby keeps ticking for a long time!) 
• I have a bad habit of impulse buying things that are not in my budget. I'm getting better about it since I got a promotion and corresponding raise, so my budget could be loosened a bit, but it's definitely still a problem.

So, according to Personal Capital + my work 401(k), which I haven't figured out how to add to PC, here's where my net worth stands now:

• Checking: $2,439.54 (I have two checking accounts - more on that to come!)
• Short-term savings: $2,674.35 (This is several savings accounts: car repairs, car insurance [paid every six months], cat savings [I have two approaching-senior cats, and their vet bills are always a kick in the teeth], and vacation)
• E*Trade: $467.52 (this is literally just a few shares in one stock that I've had since I was probably 12 or so?)
• Retirement savings: $29,329.33 (Roth IRA) and $33,269.23 (401(k) - I'm also not fully vested yet, but since I don't intend to leave my current job before I fully vest, this is the full amount in my account)
• HSA: $1,369.20 cash, $7,395.85 invested = $8,765.05 (my HSA requires at least $1,000 in cash available to pay for expenses - anything over that, I just haven’t invested yet)
• Condo: ~$120,000 (Zillow estimates my place to be worth $168k, which is so unbelievably comical to me. I don't even know if it's worth $120k, but that seems like a more likely number than $168k.)

Total assets: $196,945.02

• Credit card debt: ($24,711.57) (due to be paid off by September 2022)
• Student loans: ($22,111.42) (mostly federal, and payments are suspended until September 30, 2021 - roughly $6k is private, so that's where I'm focusing my efforts) (private loan due to be paid off December 2022, and federal loans April 2023)
• Car loan: ($1,060.11) (due to be paid off August 2021)
• Affirm loan (I desperately needed a new mattress last year, as my 15+-year-old one was causing problems for my back, and Affirm was offering 0% and no fees for a 12 month loan of the purchase price): ($437.04) (due to be paid off in May 2021)
• Mortgage: ($36,331.17) (due to be paid off November 2038 - before grad school, I made 8 months of principal-only payments that were the same amount as the mandatory principal+interest payments [not including escrow for taxes and insurance] and it cut 2.5 years off the life of my loan, which still blows my dang mind)

Total liabilities: ($84,651.31) 

Net worth: $112,293.71

Hmm. Interesting number, $112k. Most, if not all, of that is money I can't touch - it's either in a retirement account or tied up in my home. But it does feel good that I've managed to put that much together!

So, what are my goals? Well, roughly in order, they currently are:

• Pay off my credit cards by September 2022
• An annoying chunk of my budget goes to this already, and any bonus money/tax refunds will go toward this as they appear
• Pay off my student loans by April 2023
• Save enough to buy my next car in cash (no due date - I'm hoping my current little car will just keep going and going)
• Once my credit cards are paid off, max out my 401(k) and IRA savings - or max my IRA and begin investing outside my retirement accounts.

Thanks for sticking around this far!