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Old 01-08-2010, 09:22 AM
 
74 posts, read 175,176 times
Reputation: 42

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Is it possible for someone like me to build a viable nest egg to sustain myself comfortably before I am a senior? All the soft cover paper backs in the book store keeping saying I can if I just "pay myself first" and "put away 20% of my check each pay"... I know its more complicated than that and I want to educate myself, but there is just too much friggen noise out here: every bodies got a book, a website, a plan and a infomercial that will get you to early retirement, but life is short and I need help wading through the crap to get to some real viable knowledge.

My scenario:
Single
35
No kids
Plan to adopt two before I'm 40
Would like to relocate down south within 3-5 years
I make $3100 a month after taxes
Paying on a house I bought for $160,000 three years ago (but want desperately to relocate) Note is $925 a month
I have $30,000 in retirement (can't touch it unless I quit my job)
$60,00 in student loans
$12,000 car note ($350 a month)
Taking care of 3 family members who lost job and home to foreclosure (one has a chronic medical issue)
Monthly bills with family members included are about $2900
Once I get my one family member on disability and into her own house my monthly bills will drop by roughly $500

How could someone like me build wealth? I currently live as frugally as possible (new clothes maybe once a year - Ramon noodles and rice are not uncommon for dinner, no vacations, the only non-essential bill I have is my internet. I have two dogs that cost about $75 a month to feed, but they are family and I would never rehome them).

Currently I could imagine myself building wealth by starting my own business, which I would like to work on once I get my relative situated, but say I wasn't up for trying to be a small business owner, then what?

Just stuck a wage slave?
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Old 01-08-2010, 11:47 AM
 
Location: Planet Eaarth
8,957 posts, read 17,057,266 times
Reputation: 7193
Quote:
Originally Posted by Perihelion2010 View Post
Is it possible for someone like me to build a viable nest egg to sustain myself comfortably before I am a senior? All the soft cover paper backs in the book store keeping saying I can if I just "pay myself first" and "put away 20% of my check each pay"... I know its more complicated than that and I want to educate myself, but there is just too much friggen noise out here: every bodies got a book, a website, a plan and a infomercial that will get you to early retirement, but life is short and I need help wading through the crap to get to some real viable knowledge.

My scenario:
Single
35
No kids
Plan to adopt two before I'm 40
Would like to relocate down south within 3-5 years
I make $3100 a month after taxes
Paying on a house I bought for $160,000 three years ago (but want desperately to relocate) Note is $925 a month
I have $30,000 in retirement (can't touch it unless I quit my job)
$60,00 in student loans
$12,000 car note ($350 a month)
Taking care of 3 family members who lost job and home to foreclosure (one has a chronic medical issue)
Monthly bills with family members included are about $2900
Once I get my one family member on disability and into her own house my monthly bills will drop by roughly $500

How could someone like me build wealth? I currently live as frugally as possible (new clothes maybe once a year - Ramon noodles and rice are not uncommon for dinner, no vacations, the only non-essential bill I have is my internet. I have two dogs that cost about $75 a month to feed, but they are family and I would never rehome them).

Currently I could imagine myself building wealth by starting my own business, which I would like to work on once I get my relative situated, but say I wasn't up for trying to be a small business owner, then what?

Just stuck a wage slave?
YOU are a prime candidtate for the teachings of Dave Ramsey who tells it like it is.

I also noted a bit of an attitude in your post which will not help you in any way. I could be wrong but it does seem to be there.

You see, real wealth is in those things you simply cannot buy with any amount of money. Your health,your friends & family, your peace of mind &
just being glad to be alive.
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Old 01-08-2010, 11:51 AM
 
2,484 posts, read 7,913,588 times
Reputation: 1916
What about a part-time side business? Ebay? online website? Freelancing? The money from that can be put towards savings and wealth-building
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Old 01-08-2010, 11:55 AM
 
74 posts, read 175,176 times
Reputation: 42
I promise, no attitude That's the thing about computer fonts, they just epically fail at emoting.

I was actually laughing a bit as I wrote this because I was expecting to get lambasted because I should be in better economic shape at this age - some of it is my fault (buying the house) some of it is not (family members losing their jobs and home).

I will check out Ramsey - does he offer actual economic help? I don't need spiritual affirmation, I'm solid there, I need to educate myself about investing and things of that nature.

Just want to enjoy life at some point, I've been struggling on the grind stone since I was born (literally) I'm just a little tired of being a gerbil on the wheel, I want to take better control of my economic destiny.
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Old 01-08-2010, 12:09 PM
 
Location: Texas
5,775 posts, read 6,673,843 times
Reputation: 2856
Ramsey has some ideas, however it's more along the lines of find a way to pay it off, then add that payment to another to pay off whatever else you have until you're debt free. It's more philosophical than that, and he really does have some eye opening stuff that after you step back is really common sense.

Really w/out a part-time job (and really that will only help a bit), at your salary saving to have enough at retirement is going to be really hard. Really just trying to pay down what you owe, then apply the payments together is the best bet. With your debt, at your age you need to be putting away more than 20% of your check to have enough to retire at your current debt amount.

Also I would re-evaluate adopting 2 kids, the money required over a time frame of 18 years further complicates things immensely.
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Old 01-08-2010, 12:20 PM
 
74 posts, read 175,176 times
Reputation: 42
SmerkyGrl - thank you for the suggestion. I actually was selling somethings on ebay at one point. Freelance dried up when the economy went in the toilet.

TxGolfer130 - nice reality check, thank you. The bit about the kids hurts though, that's something I wanted to do since I was a teenager. I thought by 35 I would be able to afford it, obviously that's not the case.

While the gov was handing out bailouts it would have been nice if thay had considered reducing student loan debt. Oh well.

I've ordered this from my local library: Amazon.com: The Total Money Makeover: A Proven Plan for Financial Fitness (9780785289081): Dave Ramsey: Books

I'll see what I can glean from it.
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Old 01-08-2010, 12:30 PM
 
Location: Southwest Missouri
1,921 posts, read 5,562,982 times
Reputation: 910
Quote:
Originally Posted by Perihelion2010 View Post
The bit about the kids hurts though, that's something I wanted to do since I was a teenager. I thought by 35 I would be able to afford it, obviously that's not the case.
If everyone waited until they could "afford" kids, humans wouldn't be around very long.

I'll admit that I don't have any kids myself, but everyone that I know who has them simply finds a way to make it work. Kids are one of those rare things that should not be put into a balance sheet to decide on (within reason, of course).
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Old 01-08-2010, 12:31 PM
 
Location: El Paso, TX
3,302 posts, read 3,764,327 times
Reputation: 2524
Quote:
Originally Posted by Perihelion2010 View Post
Is it possible for someone like me to build a viable nest egg to sustain myself comfortably before I am a senior? All the soft cover paper backs in the book store keeping saying I can if I just "pay myself first" and "put away 20% of my check each pay"... I know its more complicated than that and I want to educate myself, but there is just too much friggen noise out here: every bodies got a book, a website, a plan and a infomercial that will get you to early retirement, but life is short and I need help wading through the crap to get to some real viable knowledge.

My scenario:
Single
35
No kids
Plan to adopt two before I'm 40
Would like to relocate down south within 3-5 years
I make $3100 a month after taxes
Paying on a house I bought for $160,000 three years ago (but want desperately to relocate) Note is $925 a month
I have $30,000 in retirement (can't touch it unless I quit my job)
$60,00 in student loans
$12,000 car note ($350 a month)
Taking care of 3 family members who lost job and home to foreclosure (one has a chronic medical issue)
Monthly bills with family members included are about $2900
Once I get my one family member on disability and into her own house my monthly bills will drop by roughly $500

How could someone like me build wealth? I currently live as frugally as possible (new clothes maybe once a year - Ramon noodles and rice are not uncommon for dinner, no vacations, the only non-essential bill I have is my internet. I have two dogs that cost about $75 a month to feed, but they are family and I would never rehome them).

Currently I could imagine myself building wealth by starting my own business, which I would like to work on once I get my relative situated, but say I wasn't up for trying to be a small business owner, then what?

Just stuck a wage slave?
I just answer by asking questions for you to answer to yourself. What I address in the questions do make a difference on how people can actually build a better future financialy without extreme sacrifice. It is not that complicated and not difficult to do. Attitude is the difference.

Do you have to buy the latest electronic gadget out there even though what you have still work just as good?

Do you have have the latest car model even though the one you have now still works just as good.

Is the house you are buying goes well beyond your needs and family size?

Are you driving a four wheeler you never use out there on open rough terrain?

Do you like to eat out simply because you do not want to cook?

Is it below your standards to buy some clothes at the local Thrift Shops?

Do you take advantage of discount coupons or not?

Do you try to spend only what is within your income?

Do you try to charge in your credit cards only what you plan to pay in full at the end of the month?

If you know you are spening more than your income, do you still do so?

Do you go to the movies when the movie just got out or do you wait to see the same movie at the $1 or $2 theater when the movie has been out maybe for a month?

Do you buy a new microwave because you like a new one and the old one is still working great but the color of the new one looks better in the kitchen?

Well, how about the computer. Do you buy the new one in the market even though the old one still works great?

Heck, did you buy a flat computer monitor even though the old style still works great but you love to see the high definition pictures?

Do you make sure when you go shopping you make a list of your shopping itinerary so you save gas and do not go and do a different trip at different day when you do not have to?

There are many good habits many people today are learning in a painful way because they are used to be wasteful and careless on how they spend their money when they had better jobs and income. Not with my wife and I. My wife looks at the news and even laughs when people are crying and complaining how bad they are and driving a late model car. She often tells me "Recession? What recession? It did not affect us know because we did not wait for a recession to do smart money management in our life and have a different attitude people have. People are now paying the consequences for their bad habits."

We always looked for ways to economize. That does not mean we deprive ourselves of enjoying life. We do but within our means since the time we got married 36 years ago. When I enlisted in the Army in '78 she stopped working and has not gone back to the civilian work force. We simply adjusted and now, 32 years later, she has saved enough money that when I retire from the Army this June we can afford of not finding a job for at least a year. She made sure we now have to fairly new cars to ensure we have transportation when I retire.
For our daughters instead of saving money for their college we spent the time teaching them study habits so they earned good grades. Good grades does not mean automatic scholarships. My wife spent countless hours in the computer looking for scholarships because I am in that bracket that I am not rich but not poor enough for my daughter to get federal student aid. She had my daughter fill lots and lots of scholarship application and assays. $50 here and $200 there and others kept adding up to the point that she was able to get enough scholarship money to pay for her bachelor degree and still had left over to at least cover half of her master program she is attending now. The only money we spent on her was a new care to make sure she has safe transportion to and from college.

We look for ways to save and even make money. I love to read so I got a Barnes and Noble Master Card credit card and every time I spend $2500 using the card I get a $25 gift card. The card I used to pay part of the new car we bought last year so it meant I had free $25 to spend on books. I use the card for just about all my spending so I "buy" pretty much all my books free. Oh, I pay all my card bills at the end of the months so I do not pay a penny on finance charges. My wife does the same with her Amazon Card and gets a lot of free gifts cards to spend on things she likes to get.

By the way we raised three daughters along the way. She and I got married when she was 19 and I was 20. She had a high school education and I had eight grade education in Mexico.
Now I have masters degree and became a Sergeant Major in the Army. I got free education while serving. She does not care to go to school but she took care of all of us and I am making sure when I am gone she does not have to suffer financially. She invested in her future by loving me and taking care of me and our daughters.

You have a great day.
El Amigo
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Old 01-08-2010, 01:16 PM
 
28,393 posts, read 68,204,916 times
Reputation: 18204
There are lots of "wage slaves" that did just fine. The key is really is being consistent in socking some sizable portion of your income away and living frugally on the rest.

In situations like yours, where you are supporting ill family members, it is especially important to make sure that you are not overpaying taxes -- a few overlooked deductions will enable you to keep more of what you earn. Use that money to pay down debt and once that debt is gone you can invest even more of your income.

Just going from the basics you have laid it strikes me that you have some pretty large student loans for your age / income. If you can leverage your education to increase your income that would be a start to fixing that imbalance.

What is you interest rate? If it is over 5.75% you probably can shave a hundred or so with refi.

Adoption costs can be high, and unlike medical benefits few employers do anything to help out, just saying that you need to factor for that as a budgeted expense.

Dogs seem like the eat pretty expensive chow, I suspect you could shave a bit off that line item...

Very few "business owners" that get into it "for the money" have things work out -- much more common is for some one to do no better than they would with wages UNLESS you are fortunate enough to have some "passion" that you can align with "willingness for consumers / business to pay for".
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Old 01-08-2010, 01:30 PM
 
Location: Planet Eaarth
8,957 posts, read 17,057,266 times
Reputation: 7193
Quote:
Originally Posted by Perihelion2010 View Post
I promise, no attitude That's the thing about computer fonts, they just epically fail at emoting.

I was actually laughing a bit as I wrote this because I was expecting to get lambasted because I should be in better economic shape at this age - some of it is my fault (buying the house) some of it is not (family members losing their jobs and home).

I will check out Ramsey - does he offer actual economic help? I don't need spiritual affirmation, I'm solid there, I need to educate myself about investing and things of that nature.

Just want to enjoy life at some point, I've been struggling on the grind stone since I was born (literally) I'm just a little tired of being a gerbil on the wheel, I want to take better control of my economic destiny.
Whew! I'm glad you took my comment about attitude in the positive it was intended.

As to Dave Ramsey and his teachings.....Dave is one of the only money guru's I know of who speaks to the blue & white collar worker equally. He tempers his advice with his belief in a deity because that belief helped him through his own tough times. The money advice he gives is solid common sense that will work for those with the grit to work at it.

While there may be other ways to get rich Dave Ramsey and the book "The Millionaire Next Door"will both help you find your own way to grow and "get rich" in real terms......on your terms.

You see 'getting rich' is really all about YOUR attitude on the matter. If the attitude is bad then the outcome will also be bad and so on...........
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