Scraping by on $500k

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Our HHI is $300K and we are stretched to the max.

Old sedans, one paid off.
2 kids in daycare
Small house with mortgage that is as low as possible while getting down to an hour commute, still outside beltway (did over 2 years with a 2 hr commute that wasn't sustainable with our jobs)
No vacations in 5 years
$300K in student loans with monthly payments that increase every year
Not maxing out retirement
Insufficient contributions to 529
Cut lawn service
Practically no savings

No fancy cars, house, private school, or nannies (unlike my colleagues). It is really, really stressful in this area.

I guess you chose very expensive law schools.

I went to the Hyundai of law schools, a respectable but well-ranked state school, to avoid that kind of debt.

Good grief.

Dear God. Why on earth did you do that?

Law school for both of us. I had a full ride for undergrad, his parents paid his undergrad. My parents paid for law school, his did not. Everyone we knew who didn't live at home (we couldn't, no family in the area) took out $200K, as did DH. Came out during the recession so no jobs and also had to take self-funded bar study loans. Lived with his parents for a stretch while doing temp work to avoid taking more loans. But, I went for a LL.M. to be more marketable ($100K for me). So, now we make a good amount but pay $3500/month in student loans.

They go up each year because we are on IBR.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Our HHI is $300K and we are stretched to the max.

Old sedans, one paid off.
2 kids in daycare
Small house with mortgage that is as low as possible while getting down to an hour commute, still outside beltway (did over 2 years with a 2 hr commute that wasn't sustainable with our jobs)
No vacations in 5 years
$300K in student loans with monthly payments that increase every year
Not maxing out retirement
Insufficient contributions to 529
Cut lawn service
Practically no savings

No fancy cars, house, private school, or nannies (unlike my colleagues). It is really, really stressful in this area.

Dear God. Why on earth did you do that?

Law school for both of us. I had a full ride for undergrad, his parents paid his undergrad. My parents paid for law school, his did not. Everyone we knew who didn't live at home (we couldn't, no family in the area) took out $200K, as did DH. Came out during the recession so no jobs and also had to take self-funded bar study loans. Lived with his parents for a stretch while doing temp work to avoid taking more loans. But, I went for a LL.M. to be more marketable ($100K for me). So, now we make a good amount but pay $3500/month in student loans.

They go up each year because we are on IBR.

I guess you chose very expensive law schools.

I went to the Hyundai of law schools, a respectable but well-ranked state school in an inexpensive city, precisely to avoid that kind of debt.

Good grief.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Our HHI is $300K and we are stretched to the max.

Old sedans, one paid off.
2 kids in daycare
Small house with mortgage that is as low as possible while getting down to an hour commute, still outside beltway (did over 2 years with a 2 hr commute that wasn't sustainable with our jobs)
No vacations in 5 years
$300K in student loans with monthly payments that increase every year
Not maxing out retirement
Insufficient contributions to 529
Cut lawn service
Practically no savings

No fancy cars, house, private school, or nannies (unlike my colleagues). It is really, really stressful in this area.

Dear God. Why on earth did you do that?

Law school for both of us. I had a full ride for undergrad, his parents paid his undergrad. My parents paid for law school, his did not. Everyone we knew who didn't live at home (we couldn't, no family in the area) took out $200K, as did DH. Came out during the recession so no jobs and also had to take self-funded bar study loans. Lived with his parents for a stretch while doing temp work to avoid taking more loans. But, I went for a LL.M. to be more marketable ($100K for me). So, now we make a good amount but pay $3500/month in student loans.

They go up each year because we are on IBR.

Surely you will be able to pay those off in no time once one or both of you make partner at a biglaw firm, no? Seems temporary to me. Pretty soon 300k will be something you can knock out in a few months if you want to.

LOL. Neither of us are associates in BigLaw or could ever lateral. Not because we don't want to, but because DH and I do not work in an area of law that BigLaw values/offers/where we could be successful. We are on a 25 year repayment plan. Student loans have 6-9% interest rates and more typically the latter. They are too high to refinance with lower rates. I take full ownership of the decision to go to law school, but there is a reason why people don't "pay down" mortgages either (with much lower interest rates, by the way).

To PP who suggested we had children too early, DH was in his mid-30's and I was 29/31. So you are saying that we should have waited 10 years until our loans were lower to have children and be in our 40's? My monthly payments would have only been HIGHER not lower, commiserate with our income. My mom was older when she had me, and while to each is own and I completely respect my female colleagues who had children later in life, I was ready and didn't want to be like my mom. So you're saying poorer people should never have kids?

You're full of excuses!! No wonder you have 300k in law school debt.

Sure keep hanging onto those loans and enjoy that monthly payment for the next 20 plus years of your life. They are hardly the same as a mortgage and if you think they are there's no point trying to explain it to you.

No. But you should have lived in a cheap rental following law school for at least 3 years and spent all of your money getting rid of those loans. Fwiw I don't think "poorer people" have 300k in law school debt.

+1M

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Our HHI is $300K and we are stretched to the max.

Old sedans, one paid off.
2 kids in daycare
Small house with mortgage that is as low as possible while getting down to an hour commute, still outside beltway (did over 2 years with a 2 hr commute that wasn't sustainable with our jobs)
No vacations in 5 years
$300K in student loans with monthly payments that increase every year
Not maxing out retirement
Insufficient contributions to 529
Cut lawn service
Practically no savings

No fancy cars, house, private school, or nannies (unlike my colleagues). It is really, really stressful in this area.

Dear God. Why on earth did you do that?

Law school for both of us. I had a full ride for undergrad, his parents paid his undergrad. My parents paid for law school, his did not. Everyone we knew who didn't live at home (we couldn't, no family in the area) took out $200K, as did DH. Came out during the recession so no jobs and also had to take self-funded bar study loans. Lived with his parents for a stretch while doing temp work to avoid taking more loans. But, I went for a LL.M. to be more marketable ($100K for me). So, now we make a good amount but pay $3500/month in student loans.

They go up each year because we are on IBR.

Surely you will be able to pay those off in no time once one or both of you make partner at a biglaw firm, no? Seems temporary to me. Pretty soon 300k will be something you can knock out in a few months if you want to.

LOL. Neither of us are associates in BigLaw or could ever lateral. Not because we don't want to, but because DH and I do not work in an area of law that BigLaw values/offers/where we could be successful. We are on a 25 year repayment plan. Student loans have 6-9% interest rates and more typically the latter. They are too high to refinance with lower rates. I take full ownership of the decision to go to law school, but there is a reason why people don't "pay down" mortgages either (with much lower interest rates, by the way).

To PP who suggested we had children too early, DH was in his mid-30's and I was 29/31. So you are saying that we should have waited 10 years until our loans were lower to have children and be in our 40's? My monthly payments would have only been HIGHER not lower, commiserate with our income. My mom was older when she had me, and while to each is own and I completely respect my female colleagues who had children later in life, I was ready and didn't want to be like my mom. So you're saying poorer people should never have kids?

I have sympathy. It sounds like you've created a difficult situation for yourselves. At least there is light at the end of the tunnel, but it will be a long road out. I would quibble with your framing a bit. It's not so much that "it's tough in this area," it's that you 2 [b]decided to finance $300k in higher education, have 2 kids (requiring expensive daycare), and purchased a home, all basically at the same time.[/b] Those decisions are what's making your financial picture so difficult, not that it's "tough in this area." Good luck.

+1. You can't do it all on 300k. You're simply unable to invest in yourself (investments, savings) when you decide to take on 2 kids, rack up insane law school debt and buy a home.

Curious what your mortgage is.

I am, too. And where PP lives.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Our HHI is $300K and we are stretched to the max.

Old sedans, one paid off.
2 kids in daycare
Small house with mortgage that is as low as possible while getting down to an hour commute, still outside beltway (did over 2 years with a 2 hr commute that wasn't sustainable with our jobs)
No vacations in 5 years
$300K in student loans with monthly payments that increase every year
Not maxing out retirement
Insufficient contributions to 529
Cut lawn service
Practically no savings

No fancy cars, house, private school, or nannies (unlike my colleagues). It is really, really stressful in this area.

I guess you chose very expensive law schools.

I went to the Hyundai of law schools, a respectable but well-ranked state school, to avoid that kind of debt.

Good grief.

Dear God. Why on earth did you do that?

Law school for both of us. I had a full ride for undergrad, his parents paid his undergrad. My parents paid for law school, his did not. Everyone we knew who didn't live at home (we couldn't, no family in the area) took out $200K, as did DH. Came out during the recession so no jobs and also had to take self-funded bar study loans. Lived with his parents for a stretch while doing temp work to avoid taking more loans. But, I went for a LL.M. to be more marketable ($100K for me). So, now we make a good amount but pay $3500/month in student loans.

They go up each year because we are on IBR.

2 lawyers should be making a heck of a lot more than $300k. Especially 2 lawyers with $300k in debt. First year pay at most law firms is $180k. You have too much debt to work a "lifestyle" job.

[Anonymous]

How are you paying 9% interest? That is absurd.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Our HHI is $300K and we are stretched to the max.

Old sedans, one paid off.
2 kids in daycare
Small house with mortgage that is as low as possible while getting down to an hour commute, still outside beltway (did over 2 years with a 2 hr commute that wasn't sustainable with our jobs)
No vacations in 5 years
$300K in student loans with monthly payments that increase every year
Not maxing out retirement
Insufficient contributions to 529
Cut lawn service
Practically no savings

No fancy cars, house, private school, or nannies (unlike my colleagues). It is really, really stressful in this area.

I guess you chose very expensive law schools.

I went to the Hyundai of law schools, a respectable but well-ranked state school, to avoid that kind of debt.

Good grief.

Dear God. Why on earth did you do that?

Law school for both of us. I had a full ride for undergrad, his parents paid his undergrad. My parents paid for law school, his did not. Everyone we knew who didn't live at home (we couldn't, no family in the area) took out $200K, as did DH. Came out during the recession so no jobs and also had to take self-funded bar study loans. Lived with his parents for a stretch while doing temp work to avoid taking more loans. But, I went for a LL.M. to be more marketable ($100K for me). So, now we make a good amount but pay $3500/month in student loans.

They go up each year because we are on IBR.

2 lawyers should be making a heck of a lot more than $300k. Especially 2 lawyers with $300k in debt. First year pay at most law firms is $180k. You have too much debt to work a "lifestyle" job.

No, pay at most big law firms is $180K, not most law firms. Many new lawyers would jump at the chance to work in biglaw out of lawschool and pay off the student loan debt, but big law is highly competitive. I'm not sure what the exact figures are, but I imagine it's less than 10% of fresh grads who get these jobs. Many non-biglaw lawyers I know are making $70k-90k, 4 or 5 years out of law school.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Our HHI is $300K and we are stretched to the max.

Old sedans, one paid off.
2 kids in daycare
Small house with mortgage that is as low as possible while getting down to an hour commute, still outside beltway (did over 2 years with a 2 hr commute that wasn't sustainable with our jobs)
No vacations in 5 years
$300K in student loans with monthly payments that increase every year
Not maxing out retirement
Insufficient contributions to 529
Cut lawn service
Practically no savings

No fancy cars, house, private school, or nannies (unlike my colleagues). It is really, really stressful in this area.

I guess you chose very expensive law schools.

I went to the Hyundai of law schools, a respectable but well-ranked state school, to avoid that kind of debt.

Good grief.

Dear God. Why on earth did you do that?

Law school for both of us. I had a full ride for undergrad, his parents paid his undergrad. My parents paid for law school, his did not. Everyone we knew who didn't live at home (we couldn't, no family in the area) took out $200K, as did DH. Came out during the recession so no jobs and also had to take self-funded bar study loans. Lived with his parents for a stretch while doing temp work to avoid taking more loans. But, I went for a LL.M. to be more marketable ($100K for me). So, now we make a good amount but pay $3500/month in student loans.

They go up each year because we are on IBR.

2 lawyers should be making a heck of a lot more than $300k. Especially 2 lawyers with $300k in debt. First year pay at most law firms is $180k. You have too much debt to work a "lifestyle" job.

No, pay at most big law firms is $180K, not most law firms. Many new lawyers would jump at the chance to work in biglaw out of lawschool and pay off the student loan debt, but big law is highly competitive. I'm not sure what the exact figures are, but I imagine it's less than 10% of fresh grads who get these jobs. Many non-biglaw lawyers I know are making $70k-90k, 4 or 5 years out of law school.

Well hopefully they didn't borrow $200k for law school then! That ROI is terrible!

[AmyForever]

Very interesting read….i make 5M a year but after all the salaries, bla bla only left with few bucks. I don't know how I'll survive. May have to sell one of the Lamborghini.

[Anonymous]

AmyForever wrote:Very interesting read….i make 5M a year but after all the salaries, bla bla only left with few bucks. I don't know how I'll survive. May have to sell one of the Lamborghini.

Lambos don't have great resale value unless one of the classics or one of the very recent ones with very low miles. DH has a Countach and a Gallardo and would never sell either, lol. I hate them.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:We feel stretched on 750k. Three kids in daycare, two SUVs, a couple vacations a year, housecleaner, $8k mortgage, home maintenance and landscaping, and a modest vacation home...it adds up a lot faster than it seems.

Then you're doing something wrong. Or living way above your means.

A "modest" vacation home and several vacations a year? Cry me a river of Amazonian proportions.

+750k

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Our HHI is $300K and we are stretched to the max.

Old sedans, one paid off.
2 kids in daycare
Small house with mortgage that is as low as possible while getting down to an hour commute, still outside beltway (did over 2 years with a 2 hr commute that wasn't sustainable with our jobs)
No vacations in 5 years
$300K in student loans with monthly payments that increase every year
Not maxing out retirement
Insufficient contributions to 529
Cut lawn service
Practically no savings

No fancy cars, house, private school, or nannies (unlike my colleagues). It is really, really stressful in this area.

I guess you chose very expensive law schools.

I went to the Hyundai of law schools, a respectable but well-ranked state school, to avoid that kind of debt.

Good grief.

Dear God. Why on earth did you do that?

Law school for both of us. I had a full ride for undergrad, his parents paid his undergrad. My parents paid for law school, his did not. Everyone we knew who didn't live at home (we couldn't, no family in the area) took out $200K, as did DH. Came out during the recession so no jobs and also had to take self-funded bar study loans. Lived with his parents for a stretch while doing temp work to avoid taking more loans. But, I went for a LL.M. to be more marketable ($100K for me). So, now we make a good amount but pay $3500/month in student loans.

They go up each year because we are on IBR.

2 lawyers should be making a heck of a lot more than $300k. Especially 2 lawyers with $300k in debt. First year pay at most law firms is $180k. You have too much debt to work a "lifestyle" job.

No, pay at most big law firms is $180K, not most law firms. Many new lawyers would jump at the chance to work in biglaw out of lawschool and pay off the student loan debt, but big law is highly competitive. I'm not sure what the exact figures are, but I imagine it's less than 10% of fresh grads who get these jobs. Many non-biglaw lawyers I know are making $70k-90k, 4 or 5 years out of law school.

Well hopefully they didn't borrow $200k for law school then! That ROI is terrible!

I have to say, the way people constantly claim others took out too much in student loans is really obnoxious. "Cheap" law schools that are highly ranked enough to get to a chance at a well paying job are basically non-existent. I went to a "cheap" in state public law school in 2005, and tuition rose by over 30% in the two years I was there. Students there now pay more than twice what I did in my first year. It's not the students fault, and it's truly classist to blame people without rich parents for taking on law school or med school debt. Poor people are allowed to try and be lawyers and doctors and it's not their fault that federal loans have created a tuition bubble.

[Anonymous]

Poor scan take out loans to go to 2d and 3rd tiered schools. And we can LOL at poor for their "poor" planning.

[Anonymous]

Our HHI is about 78k and we own three homes, three vehicles, have money in the bank, and money for vacations. We also live far below our means. Two of our homes are rental properties. I shop at thrift stores and consignment shops because I enjoy treasure hunting, and I do my own repairs on everything except for big jobs. I also do my own motorcycle repairs, because anyone who rides should know how to repair their own bike. My husband is law enforcement, three years from retirement. We've been married less than seven years. It's all in how dedicated you are to saving, and where your priorities lie. We don't compete with anyone. We do what makes us happy.

[Anonymous]

law school debt poster is probably a troll. With a HHI of 300k she and her husband don't qualify for IBR because they make too much money. IBR doesn't take other debt into consideration (mortgage, cars, etc) and also doesn't take childcare into account when calculating your monthly payments. IBR does consider family size, but 300k/year wth 2 kids wouldn't cut it. With 3 kids they might, but the payment wouldn't reduce by much. Go play with an IBR loan payment calculator. Most whose loan sizes are equal to or less than their income won't qualify.

I know because I am on IBR for law school, using the PSLF. I have to apply every year, and I'm constantly trying to reduce my taxable income. That means that with a gross of 70+k/year I'm over halfway to maxing out my TSP contributions (not married) so that my income stays low and my payments don't go up.