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!
