Trying to go from (almost) zero to ER hero!

[Relaxed Cajun]

Hello all!

Glad to find this inspirational forum.

Some basics on my family:
Married, no kids, 2 dogs that my DW thinks are kids. We plan to have 1 child in the next couple of years.
Ages: 33 (me), 30 (DW)
Occupation: physician (me;completing training 2012), lawyer (DW)
Combined Future Salary (just signed contract to start 2012) - $300,000/yr
Goal: ER in 20-25 years with 4% initial withdrawal rate
Savings: $10,000 in 401K (been in school- no income to save!)
Savings plan: we will save 20% gross of each paycheck automatically; plus save whatever extra we have in our checking account at the end of each month
Debt: plan to borrow $250,000 in 2 years to build home; no CC or consumer debt; $30,000 in student loans
Insurance: will purchase 20 year term life insurance; have health and disability through work
Investing plan: none - that is why we are here!

This post is to say hello. I will post specific questions on the appropriate forums. We are basically trying to get off to a sound financial start.

Thanks (Go Saints!)

 

[Meadbh]

Welcome to the forum!

We seem to have new physicians joining every week of late. Maybe that tells us something about a change in physician culture!

You and DW are in good shape because you have Seen The Light early in your careers. And your student debt is very modest.

Lots of wisdom here: just dive in and ask!

Meadbh (MD)

 

[Relaxed Cajun]

Thanks for the welcoming

Thanks.

My loans were substantial (140K), but my soon to be employer is paying them off over the next 5 years, so I did not count them.

 

[Dawg52]

Welcome and good luck to you and your wife on your new careers. You both have great earning potential so reaching your goals should be easily obtainable. Smell the roses along the way as we never know how long we have on the planet.

 

[BigNick]

Savings plan: we will save 20% gross of each paycheck automatically; plus save whatever extra we have in our checking account at the end of each month

I suggest that you force yourself to save more. Put it somewhere that spending it would mean a letter to a bank, not just an Internet transaction. Otherwise there will be a big temptation to never have very much left at the end of each month.

With a combined income of $300K you will want to find every tax-deductible way of saving possible, and then save some out of taxed income too. In order to live with a 4% withdrawal rate if you've only saved for 20 years, you have to have been spending an awful lot less than your salary for those 20 years. (You didn't say what your hoped-for retirement income is.)

 

[FreeAt30]

(You didn't say what your hoped-for retirement income is.)

Good point.

Another thing to consider is how important FIRE is to you. If you both love your jobs then there's no need to be super aggressive with putting money away for the future or watching your asset growth and spending habits like a hawk. On the other hand, if you want to get there as soon as possible, it will all depend on how much you're willing to give up right now.

I'm not advocating either. I have good friends on both sides of the spectrum, those who don't save very much but love what they do and are enjoying the ride as well as those who are constantly tweaking what and how they work and live to get closer to a well defined FIRE goal.

The only folks that confuse me are the ones that seem to want financial freedom yet complain about how hard it is as they hand what amounts to $1000 every year to Starbucks as they supplement their iPhone with an iPad with all the necessary cables to plug them into their leased/financed car.