Financial Advice

[pharmrx33]

Hello all, after two grueling years of residency, I was fortunate enough to find a great job in a big city. I know there are some very financially savvy people in this thread, so I was hoping if I provided some stats you might be able to help me out. I will have some pointed questions as well.

Salary: $116,000
Loans: $134,000
Ideal Retirement Contribution: 15% (does that seem reasonable? Employer matches 100% up to 6%).

About me:
28 years old, healthy
I am definitely not a big spender, but wouldn’t call me exactly frugal.
Would like to live in city without a car and target rent/utilities/etc < $2000/mo

Do you think it’s reasonable that I could pay $2000/mo on student loans or should I aim higher?

If anyone has any general advice, I would gladly accept. I know there’s information I’m probably missing out on too. Or if you have any good budget websites you think work well.

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[APN-59 rph]

BIG City expensive? Do NOT go on a spending spree......Take a pretty big bite out of loans...put a pretty big bite into some cash 2% interest is about it these days...ask around for a REPUTABLE investment house for index AND managed funds ..........Take whatever investment matching you can get.. .....Rat's (jeez I hate windows 10) anyway...live like a church mouse for a year....don't get married yet...don't get divorced or have kiddies yet.....Ask around about a decent mouthpiece....Have a pre-nup....various POA's etc...umbrella policy.

 

[mentos]

I would personally contribute only up to the match 6% for retirement and pay off as much loans as possible. Refinance the loans for a better rate, shop around there are many banks and many threads here about this.

Some people recommend paying less of the student loans and investing the rest but I don't know what I'm doing so I prefer to pay off debt ASAP. I paid off loans in less than 3 years and it was the best feeling.

2k seems like a lot for living expenses even in a big city. Are you living with roommates? If not, total waste of money.

Enjoy yourself but don't blow too much money on eating out, bars, clubs, dates. It adds up quickly.

 

[radio frequency]

100% match up to 6%? Is this retail or something? If not then dang, I want to work where you work.

I like mentos’ advice above. Get that match, then grind it out. Save save save and pay off your loans.

I haven’t regretted paying mine off quickly yet. Debt free feels good. I have coworkers still slowly paying theirs off. I hope the loan forgiveness they are targeting works out for them, but I wouldn’t want to risk it in today’s political climate.

And unless you already do, definitely don’t have kids until you pay this off. Because that’s a whole new ballgame of non-negotiable costs.

 

[rxdawg21]

Walmart offers 6%

 

[Transformer]

Congrats on finishing residency and the new job!

My advise is to continue to live frugally/like a student for the next 3 years or until you pay off your $134K student loan.

With $116K salary (75k-80K after tax) and monthly expense of < $2000, try to target for $3500 to 4000 plus per month in student loan payment. (Yes it's doable with determination and lots of financial planning/oversight)

Consider refinancing only after your find that your job is stable and/or your family can help if you loose your job.
Consider a per diem job or side hustle to increase income.
Find a roommate to cut down in monthly housing expenses

Agree with other posters on being very careful with spending and contributing to the 6% match for retirement

Good Luck!

Hello all, after two grueling years of residency, I was fortunate enough to find a great job in a big city. I know there are some very financially savvy people in this thread, so I was hoping if I provided some stats you might be able to help me out. I will have some pointed questions as well.

Salary: $116,000
Loans: $134,000
Ideal Retirement Contribution: 15% (does that seem reasonable? Employer matches 100% up to 6%).

About me:
28 years old, healthy
I am definitely not a big spender, but wouldn’t call me exactly frugal.
Would like to live in city without a car and target rent/utilities/etc < $2000/mo

Do you think it’s reasonable that I could pay $2000/mo on student loans or should I aim higher?

If anyone has any general advice, I would gladly accept. I know there’s information I’m probably missing out on too. Or if you have any good budget websites you think work well.

 

[GrandTheftAutumn]

Congratulations on finishing 2 years of residency.

I've been a retail RPh for almost a year and I do a little bit of everything to make my financials solid.
For student loans, I'm on 10 year repayment plan which comes out to be $1500 a month, but I double down each month ($3000).
So $2000 each month is more than doable.
I plan on refinancing here and there for sign on bonus and better rate; thus far I refinanced once and submitted my application for second refi.
For 401K, I only do up to my employer's match but still comes out to be a descent amount.
Some HSA contribution.
Rest, I dump into my individual stock account- probably risky move but I'm willing to take the risk.

You'd probably want to build some emergency fund in an online saving account (2% yield) if you haven't already.
Live like a monk for at least 1 year; sucks but helps you substantially in the long run- it's the first year that's important.
I still live pretty frugally- I usually only spend $2000 or less each month including rent, utility, gas, grocery, etc.

I'm curious though, how much loan payments did you make during the residency years?
And how much did you contribute to 401K and save emergency fund?
How do other residents do it?

 

[rxkrafted]

I had approximately same amount of loans as you after I graduated. I paid < $2000 towards my loans and set my goal for 7 years but as time went by I wanted to aggressively pay it off and I will finish paying my loans off next years (4 years). I regret not deciding to make consistent large payments sooner. Live frugally, invest and get the full match from your employer 401k and also contribute to your roth ira if you can.

 

[Twentytwelve2]

I did the opposite. My first two years as a pharmacist was me celebrating myself and my new income. I splurged it all lol. Now that I got that out of my system, I am ready to pay 6,000 a month to my loans.

 

[alpha12]

Hello all, after two grueling years of residency, I was fortunate enough to find a great job in a big city. I know there are some very financially savvy people in this thread, so I was hoping if I provided some stats you might be able to help me out. I will have some pointed questions as well.

Salary: $116,000
Loans: $134,000
Ideal Retirement Contribution: 15% (does that seem reasonable? Employer matches 100% up to 6%).

About me:
28 years old, healthy
I am definitely not a big spender, but wouldn’t call me exactly frugal.
Would like to live in city without a car and target rent/utilities/etc < $2000/mo

Do you think it’s reasonable that I could pay $2000/mo on student loans or should I aim higher?

If anyone has any general advice, I would gladly accept. I know there’s information I’m probably missing out on too. Or if you have any good budget websites you think work well.

Max out your 401k and hsa. the 401k is 19000 and hsa limit is 3500. That will give you enough of a saftey net when you retire. I wouldnt spend 2000 a month on student loans. Life is short. Enjoy it while you can. But I guess I have no authority on the matter because my total loan was 39k and I paid it off in a couple years.

 

[angryrx]

Hello all, after two grueling years of residency, I was fortunate enough to find a great job in a big city. I know there are some very financially savvy people in this thread, so I was hoping if I provided some stats you might be able to help me out. I will have some pointed questions as well.

Salary: $116,000
Loans: $134,000
Ideal Retirement Contribution: 15% (does that seem reasonable? Employer matches 100% up to 6%).

About me:
28 years old, healthy
I am definitely not a big spender, but wouldn’t call me exactly frugal.
Would like to live in city without a car and target rent/utilities/etc < $2000/mo

Do you think it’s reasonable that I could pay $2000/mo on student loans or should I aim higher?

If anyone has any general advice, I would gladly accept. I know there’s information I’m probably missing out on too. Or if you have any good budget websites you think work well.

To find financial success as an RPh, you will have to be creative and think outside the box. To tuck away a couple Gs here and there every month will bring relative financial safety, but you will never reach financial freedom. It's not like we're in super high salary positions where we can be dumb and still be fine.

There's no set recipe for this, and you will have to find your own course. I looked at wealthy people (NOT RPhs) for examples and tried to see if their strategies would fit the level of risk I was willing to take. From my observations, RPhs are NOT the best people for financial advice.

 

[wagrxm2000]

To find financial success as an RPh, you will have to be creative and think outside the box. To tuck away a couple Gs here and there every month will bring relative financial safety, but you will never reach financial freedom. It's not like we're in super high salary positions where we can be dumb and still be fine.

There's no set recipe for this, and you will have to find your own course. I looked at wealthy people (NOT RPhs) for examples and tried to see if their strategies would fit the level of risk I was willing to take. From my observations, RPhs are NOT the best people for financial advice.

Simple math says you are wrong.

A family of 4 with a combined salary of $160k should be able to save $2k a month.

$2k a month at a reasonable 7% will give you over $2.5 million at age 55. You should then be able to live off 3% for the rest of your life.

Oh and there are plenty of pharmacists that understand finance.

 

[peteronfireee]

Ya put a good chunk into loans but have some emergency funds ready too; you’ll never know what can happen in the future

 

[TheFIREmacist]

Assuming you maximize your 401k to the contribution limit of 19000$ and your employer provides a high deductible health plan you would be eligible for an HSA account and you maximize that as well at 3500$ (some employers will match some of your HSA contribution too #yaasss). Your net taxable income is now to 93.5k. Your take home pay is roughly 5000-6000 range after dental, medical, disability insurance, stock options through your work and other deductions I would buy a crappy house (250000$ subjective amount based on city) with 3.5 percent down at homeowner rates. House hack by renting rooms out to one or two roommates for a few years. That should cover part of your expenses or your mortgage by probably by half. Utilities would be at least halved or 1/3. Now you have principal pay down on your home, along with home appreciation of a conservative average of 3 percent (3% of 250000 = 7500$, now that's a good return on your investment per year on what you put in at 3.5 percent down).

Keep the house when you move to a new home and rent that house out keeping your homeowner mortgage at 3.875 percent for next 30 years.

Refinance your loans through different lender at lower interest.

My general rule of thumb is if your money can make you more money than your loans interest don't worry about the lower interest loans. For instance, a home loan interest is at 3.875 percent, why would you pay the home off when the index funds at vanguard can get you 7% or more for your money.

Summary
Max your HSA first. You will get old, you will be sick. No better way to use your money tax free, grow tax free and untaxed when you put it in when used for medical purposes.

Max your 401k contribution limit

Match your employer stock contribution discount.

Buy a home to live and rent to other tenants

Refinance your student loans for lower interest

Stash away 6 months worth of living expenses.

Invest the rest in index funds at vanguard or fidelity.