[USER]

Hello everyone. I would love some guidance. I am a 36 y/o female. I just started a new job and make 55 k a year. I have nothing saved for retirement, 65 k in student loans. I don’t have a car payment.

My rent is 700 a month, I pay about 380 per month in other bills.

I want to start this new job off on the right financial foot. I don’t want to repeat past mistakes.

My goal is to save for retirement, buy a bigger house ( my house is tiny), and to just be better off financially. I am a hard worker but bad with money.

Any helpful advice or encouragement is appreciated.

Thank you

[Kim]

I suggest looking into Dave Ramsey Total Money Makeover. I don’t agree with all his teachings but the basic plan will get you out of debt fast and help you save money.

[Marisa]

Hopefully you took those student loans in order to leverage yourself into a higher paying job.

Start looking for a higher paying job ASAP!

[Mark]

proper order of operations. get on the dave ramsey plan

[Steve]

1) read Simple Path to Wealth
2) spend much less than you make and regularly invest the difference. That’s the most important part. The rest is details. Make it an automated investment.

3) max out 401k or Roth 401k. Roth would be preferred in your tax bracket.

4) for all your investments choose low cost index funds or ETFs. Broad market indices of domestic, foreign stocks and bonds.

I’d stay fully in stocks while you are young and accumulating wealth.

5) never withdraw money from 401k or brokerage until you retire

6) don’t try to time the market. Just stay invested.

7) don’t buy individual stocks, crypto or trade options. The risk is too high to lose a lot.

[Christine]

Wow, our stories sound SO much alike. At 36 I had no savings, a car payment, student loans and was making the same money. It wasn’t until I was 40 that I woke up, so you are ahead there!

1. Start by looking at your budget, I hated doing this, still hate it. But you need to know where you can cut, and you do need to cut.

2. Lifestyle – I looked at my grocery, eating out and car and decided to change a lot of what I did.

So, I started shopping at Aldi only, going only to happy hours and paid my car off and drove it for 12 years. This helped A LOT.

3. Income – you can only save so much, you have to earn more. I worked my way as far as I could go and then decided to work from myself, my income 3xed after 3 years.

This had a HUGE impact on my savings journey!

Bottom line: Age 36 zero in savings 38k in student loans, 15k on car note. Age 44 currently (debt free except mortgage @ 1.99%) and have nearly 600k in invested assets.

YOU CAN DO THIS!

[MLiss]

Hold off on the housing, squeak as much time out of $700 rent as you possibly can. Housing is such a huge key to getting ahead and it’s easy to bury yourself in that payment.

[Valerie]

As other have recommended, read A Simple Path to Wealth. Dave Ramsey Baby Steps, and I’ll add Rich Dad Poor Dad. You are in a perfect place for all of this.

As you are making your way through the books, before you buy every single thing ask yourself if you really need it.

Make your food at home, don’t buy coffee out, look for free stuff, etc.

You have such a bright future. You got this.

[Michael]

I have a different view of debt than other people here.
If those are your bills including the student loans, there is no reason you shouldn’t be saving money.

I would assume an additional $500 on food per month minimum.

You are the only one who can force yourself to change your spending habits.

While I think real estate is guaranteed wealth long term, you can make any place a home.

A bigger house=bigger expenses=not something you want unless you have a decent cushion to keep you going.

Focus on what’s achievable now. It costs me 4k/month before I leave the house WITHOUT a mortgage.

We all have our vices. For me, it a large redbull for $5/day and 2 packs of cigarettes( about 10/day)
That’s $5,475 per year in extraneous.

So,now I do my best to skip the redbull some days and cut back on the smoking.

Maybe you have different vices, but they all add up. Maybe it’s a fresh latte every morning.

Buying fresh produce that ends up spoiling because you never used it is also a waste of money. Don’t buy fresh produce unless you plan on consuming it fairly soon.

In my personal opinion, since your bills are manageable, I would invest as much of my income as possible into a stock market index fund like SPY or VOO plus the retirement plan at work. Live below your means.

Once you factor inflation in, your student loan payment will technically be worth less in the future than it is today.

It is possible to budget yourself while also building wealth.

Right now, I live off my investment income. I do my best to only spend 50%-60% of the income.

And if your employer offers a retirement plan,enroll in that as well
I would declare 0 for the maximum federal tax withholding. This way,you’ll get a refund the following year.

Try to live like you’re only making 2k-2500/month.

You’re in a position of strength if your bills are that small.
I’m not saying completely give up your vices, but take a hard look at what you could cut back on.

In my late 20s and mid 30s, I was making 14k/month with 20k/month dished out towards debt. 2008 set me back for many years.

I was able to save more on an income of 6k/month with zero consumer debt

A high income does not equal high networth.
Sacrifice and good spending habits do.

My younger brother has almost a networth of 1 million at age 42 because he had good spending habits. He didn’t go to university for a degree he never used like I did. He was just responsible. 0 debts, minimal extraneous spending.

On the other hand, I’m comfortable but a few hundred thousand behind him.

A higher income is always better but no guarantee of wealth accumulation.

[Sandy]

Ramit Sethi’s book – I will teach you to be Rich. He also has a series on Netflix.
I highly recommend to read the book and watch his Netflix series and like others have said, read the simple path to wealth, the point is just start.

I would start with a Roth IRA and a traditional IRA. At this point in time even if you could do $50 a month while you tackle your student loans, it compounds over time!

Read as many books, watch videos on financing and listen to podcast, understanding the language is a tremendous help.

I sure wish I would have started at your age! you got this!

[Trina]

Start a side gig, you might be able to reduce your taxes with the expenses from the side gig until it actually starts paying off.

In the long run, you will be able to save a lot more. Taxes hurt the middle class.

Also, save as much as possible for retirement starting now…

[Sue]

Okay, did HR inform you how to complete for their retirement fund? Does your company offer matching to them up to a certain %?

Also, HSA (Health Savings Acct) or do they only offer FSA (Flexible Savings Acct.?) In addition, does company offer annual discounted stock options?

Next, get those forms completed and make sure with every paycheck, they are automatically deducted to said accounts.

Create a itemized budget, make sure all monthly expenses are paid first, dump extras to pay off credit card debt and student loans.

That’s it for now as you are a beginner. This is how I started my adult child with first job. Work hard, assign every $1 you make a job to do.

Don’t blow extra money just because you see a overage as they have a job to do and that’s to get you to F.I.R.E.!

You work hard at your job, make your money work harder for you!

[Rosa]

Those are the things I would research/read and implement.
But also increase your income because that will make it easier to do all the other things that will lead you to financial stability.

[Al]

Start with deciding you’re now good with money. I used to be bad with money but now I make better decisions by spending and saving intentionally and following a plan.

[Jeremy]

I would look at Financial Order of Operations from the money guys by far my favorite plan and it is a free download. You have time but a plan is needed especially at 55k.

You can do very well but will make sacrifices. Best of success on the journey.

Other plans and people that are mentioned I have read as well

[Dustin]

Download the acorns app, set it to 5 or 10x. It Saves the money for you as you spend

[Sunny]

Immediately enroll into your work’s retirement plan offering. Even if you don’t get a match. Enroll. Put at least the minimal matching. Figure out a comfortable % to invest.

Then throw everything spare cent you have at the student loans. Do not wait for the monthly statement.

Got $10 bucks, throw that $10 at the principle immediately. Like the moment you have the money to spare. When you do that, that is $10 that you are no longer paying interest on right then.

If you wait 30 days to pay that $10, then you just accrued 30 days of interest for nothing.

Keep your time horizon for the long game. 20-30 years. Read all the books that teach you how to invest.

Every time you get a raise, take that raise and dump it into your retirement or investment accounts.

You can live on your current salary, whatever that might be. The extra increase is just extra. Invest it.

Have a good 6 month emergency fund. Like if you got injured or sick, you could live off this emergency fund without sweating it too much. Keep building the emergency fund.

Maybe you’ll need $20k one day to buy a car with case etc.

[Franc]

Find a side hustle and start a business that only involves time and not any major start up costs.

Something you will enjoy. Like a YouTube channel? Modeling / promotions. Review products like make up, skin care in YouTube.
Child care or teaching / tutoring.

Maybe you can teach a hobby such as dance lessons or a sport, like swim lessons. or a musical instrument or voice lessons if your musically inclined
Drive for uber.

Do dog walking / pet sitting if your into dogs.
Become a tour guide for via tours showing tourists private tours of local museums, attractions.

If you speak any languages become a language teacher or offer translator services.

If you’re kinky and open minded sexually, start an only fans.
Or Advertise your social skills and offer platonic companionship / being a wing woman

or become personal assistant to older and disabled persons that need help with errands, groceries, etc.

learn to code, and create a app / game that generates ad revenue / royalties or subscription based.

Most importantly get out there and network. Be positive. Your network is your net worth.

If you met and impress the right person they will offer you a better job or become a business partner, or invest into your own ideas and business.

[Author]

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