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btw as it relates to the take-home pay i think i figured it out.
i think it's because i contribute 8% Roth 401k and 8% Traditional.
if i switch it to a full 16% Traditional, i think my take-home would rise b/c my taxable income comes down.
maybe this is incorrect? feel free to tell me if i'm wrong here.
You make about 15k more then me, yet my monthly take home is $650 more then you. I contribute 6% to 401k myself. The 10% extra you put towards retirement doesn't add up to it unless you have vextremely expensive health benefits or something going on.
You make about 15k more then me, yet my monthly take home is $650 more then you. I contribute 6% to 401k myself. The 10% extra you put towards retirement doesn't add up to it unless you have vextremely expensive health benefits or something going on.
i figured it out. i think.
and the reason was b/c i was contributing 8% pre-tax and 8% post.
not going full 16% pre not only made me a take a hit on my taxable income but the 8% post was also a significant hit.
i switched it to 16% pre today. i think that should increase my take-home by ~$500.
Technically, you can afford it. I'd feel better saying that if you had more if your 401k and Roth IRA. Those retirement balances are low for someone of your age and income. I think you should go with a cheaper car.
Technically, you can afford it. I'd feel better saying that if you had more if your 401k and Roth IRA. Those retirement balances are low for someone of your age and income. I think you should go with a cheaper car.
don't disagree but i'll be maxing from here on out. only started my Roth this year and my 401k like 2 years ago.
so late start, but i don't plan on scaling back my contributions.
so it's somewhat cutting it close but i also expect (stupidly, maybe) my income to rise as i'm in the very junior ranks.
This is where people get in trouble.
First it's the car and "oh my income will go up".
Then it's your wedding.
Then it's a house.
Then it's kids.
Then it's the kids' college.
And on and on it goes. Once you establish the habit of stretching a little to afford something you set a pattern that is very hard to break--as you end up stretching for all of the above, which keeps you in the hamster wheel/rat race until you're 65....unless they get rid of you before then...which is pretty common.
While a 16% savings rate is good by American standards, it really only affords you a decent retirement in your 60s. If anything goes wrong in the intervening 35 years (and believe me, plenty of things are likely to go wrong), you're behind the 8-ball.
I can't stress this enough - plan plan plan! If you consider each item that you can spend money on in isolation, you can easily get yourself into trouble even on a $170k income. You have to put together the budget, because the ability to afford X, Y, or Z does not imply that you can afford X, Y, and Z!
In other words, other expenses matter too, as well as any debt that OP's spouse-to-be may have.
Agreed.
Stated another way....you can probably afford anything you want. But you can't afford everything you want.
find me a safe, reliable and at least relatively enjoyable vehicle for $15k (out the door price incl taxes).
now if you were to say $20k, OK, you can get a bare bones Subaru Impreza for that price.
in my mind, when you amortize the additional ~$10k over the life of the vehicle, those relatively small dollars are worth some extra comfort and utility.
i could be off base though.
The way I look at it, that extra 10K invested yields quite a bit of money.
10K invested at a fairly conservative 7% rate of return would turn into:
$19,671 in 10 years
$38,695 in 20 years
$76,118 in 30 years.
And that doesn't include the savings from lower insurance and registration costs.
it's not all that easy to find, in this age, reliable transportation for a daily commute for $10K.
could i potentially find a 10 year old Camry or something? maybe.
I don't think it's as hard as you make it out to be. I just bought a 2014 Corolla for 13K with all taxes, etc. out the door and I didn't negotiate that hard on price.
I just think you want a new car and a specific model and have convinced yourself it's a need.
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