Jon here...starting from nothing (in the hole)

[Options]

At 28 I was divorced, working minimum wage and blowing any left-over money on recreational drugs. The year before I had actually spent a night in a shelter. Retirement was not something I had ever even thought about. I was focused on avoiding thinking about my sorry life and my next hit of meth.

You are thinking about things I didn't start working on until I was over 40. That's when I got out of debt and started saving/investing. Even then I got lucky with pensions and the insane level of matching they provide in the government sector. Set aside some emergency cash, then kill that debt. There is probably some math that would indicate you should invest vs pay extra on debt. I'll leave that to others. But debt is a psychic weight. The sooner it's gone, the sooner you can see your way to early retirement.

I envy you. By the time you hit 50 you can easily be one of the people here with 7-figure nest eggs. Good luck!

+1
I didn't have a quarter of the intelligence you exhibit OP at your age.

 

[Helena]

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Debt is you enemy... systematically get out of debt and stay out of debt.

Once out of debt, money wasted servicing debt can go towards retirement.

Car debt is especially a burden. That is why many middle-class self-made millionaires drove older used cars on their way to financial freedom.

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[highlow65]

I don't think as a CPA you need any financial advice from me. You will be fine as long as you and your wife stay on the same page, and don't let financial creep happen as your income gets larger. Its easy to say you wont but sometimes harder to stop. Good luck and time and investing wisely can make up for a very slight late start.

 

[FreeBear]

What made you think about retirement planning? Just curious...

You guys are doing well in your late 20's! You've both got good professions and have a reasonable plan. Lots of good advice on this thread, for the most part!

DW and I started saving for retirement at a similar time, but no where near as aggressively. We married well into middle age, but we were able to retire over a decade before "normal" since we both were saving for retirement.

Roughly speaking, it looks like you are planning to live on one income and invest the rest. It's a great plan, if you can stick to it. It may be a challenge if/when you have kids. I see that many parents try to buy stuff for their kids that they "lacked". Don't cheat your kids out of the privilege of working hard and smart to attain their dreams.

Invest time and energy into you marriage and family, especially when things are tough. The divorce stats aren't encouraging, but then again you show that you have the drive to beat odds.

It would be wise to get familiar with Firecalc and other retirement planning software. It will give you an idea of when you can retire based on income, expenses and investments. If I had such tools in my 20's, I probably would have retired 5 yrs earlier still!

 

[ugeauxgirl]

The fact that you are thinking about retirement at age 28 is wonderful- I read somewhere that the average age Americans start saving for retirement is 47- so you are ahead of the curve! Also the fact that you have been poor can be a great asset as well. My husband grew up poor and his viewpoint has been invaluable to me- he makes me appreciate as luxuries things I always took for granted and he didn't have growing up.

I started over with nothing after a divorce at 30 and am about to cash in my chips and retire at 46. You can do it! Keep us up to date on your progress!

 

[AJ520]

This guy can't be serious. It'd do you some good to think before speaking. I'm not sure why you think I have to change so much and I'm not sure how your story relates to me. I'm sure you received more help than you claim like shelter. Also if 150k between two people scares you that much, I don't know how you are able to invest. Student loans are great for financial leverage. I took out student loans to be able to finish school in 1 year vs 3 years. I could pay off my portion of student loans in two years with my increase in salary if I wanted but this wouldn't be wise.



Lastly, I didn't waste four years. I will be a CPA by this time next year after accumulating experience. Read about it.



You try paying for a spouse education and living expenses for four years with partial scholarships and limited income.



This motivates me extremely.

I am graduated from the number one public university with a social welfare degree, a degree of my choice that doesn't make much. I think what engineer is trying to say is wasting 4 years getting a degree that wasn't ur choice is not a good one to make but it seems like u were cool with it as a life experience and with a scholarship u able to do it. We were young once and we are where we are today.
I was too had to take out student loans while I work 30hrs a week to support myself. The student loan wasn't even to support my school work, I took it out to support my family, who was extremely poor. my family and I immigrated to the us in 2002 with nothing but debt.
We were lucky to ride the wave of the housing crashed(sorry for those who loss money) that allowed us to scoot up some extremely cheap rental properties with all my sisters and I (the 3 of us) taking out student loan to use as down payments and my employment history for mortgage loans. With my dad as a contractor, who weren't able to get any job during the market crash, that was our only way to survive as a family. This strategy really saved my family and now we own houses, and house value has double and triple since 2009 when we start buying. We went from living paycheck to paycheck and living in debt to now living comfortably and able to take family vacations.
There are many opportunities in life and there is no one path to FIRE. And I don't think my parents ever thinking about retiring let along retire early.
I will be hitting 28 next year and I am planning my retirement plan and my parents.
Good luck! I will be following ur progress!


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[SATim]

Your education debt, age, and income projection actually match mine almost perfectly. Good news: my net worth finally went positive a month ago (in my 3rd year of making good money), and it's projected to increase by about 45K/year (28K to Roth 401K, 5500 to nondeduct. IRA and the rest is paying down the debt). FireCalc projections show I should be able to drop to halftime around age 42 or so and be FIRE by 45.


I'd echo everything above and encourage you to ignore the trolls, focus on where you want to go, and keep living like a college student as long as possible. Also you have my sympathy for the Houston traffic, did that for a year and escaped to San Antonio where everything is much, much more affordable. hint hint....

 

[exnavynuke]

It's like you are in my head. We will have trouble spending more than 3 - 3.5k a month for living expenses and that includes vacation. They are currently around 2500. But of course we don't have children.

I plan on contributing enough in tax deferred accounts to keep us in 15% tax bracket which is about 36K. Taxes including federal and payroll will be about 18.3% of income. The rest will go towards debt I'm gonna buy a cheap home that'll turn into a rental.

I have built a spreadsheet for budget but does anyone have a budget spreadsheet that they are willing to share for comparisons?

I'm just gonna put it out there that no one I've ever met has had "trouble spending more than 3-3.5k/month" after they started making enough to afford it. I'm single, with only a 15 year mortgage ($128k @2.55%) and I spend that much a month AFTER saving for FIRE without living anything close to an "extravagant" lifestyle.

It's perfectly possible to spend less, but it really easy to spend more. If you want to spend less, you can. You will just have to maintain the discipline to keep it up over the years.

Sounds like you have a great plan though and I wish you the best of luck in carrying it out. Look forward to hearing your updates