Terminalcoffee discussion

Ok, so I have some questions about finances that may be answerable by some of our more experienced TCers. I have many, but I'll start with one for now.

Is $30,000 a lot for an-early-but-not-quite-first job? I have no frame of reference.

Depends on what you are doing, pretty good for a McDonalds worker, not so good for a doctor. Does the job require a degree?

Starting salaries can vary tremendously depending on geographical region and field of endeavor. Also benefit packages can make a substantial difference, for instance with health care. Do you have more details?

And where you live, too. 30 grand in one area is different than 30 grand in another.

Also, I think Amber just called some of us old.

RandomAnthony wrote: "Also, I think Amber just called some of us old."

Yes, that's how I translated "experienced" too. It's a tactful turn of phrase, though.

RandomAnthony wrote: "Also, I think Amber just called some of us old."

She's too nice to do that.

$30k is about what NYS pays for entry level clerical workers.

Pilots for some regional or commuter air carriers make about $30,000.

Starting teacher pay is often around 30 grand.

I live in Northern VA. It's secretarial work, but it's for a small company with very ineffectual managers, so you carry way more work than your average secretary, doing payroll, HR, accounting and some basic graphic design along with your typical phone/filing/data entry, etc. I'm only asking because it's what I technically make at my horrible job, so I'm trying to get a handle on what is realistic to expect if I leave for similar work at a different company. It's a weird way of going about it, but it's really hard to get perspective.

Ok, so on a slightly different note: Does anyone have good budgeting advice that may seem obvious but people tend to overlook?

Oh, and no benefits. No health, no 401k, zilch.

Does that mean you would move from a job with benefits to one without? I'd be careful about doing that, certainly. Would you be able to get health insurance through your husband's job? And what's his job security like? (You don't have to answer, just consider.)

I think salaries for that type of work are dropping. They were higher before the financial disaster of 2008-. A lot of layoffs in office work, and when these companies rehire, if they do, they drop the salary significantly. (Or go with temps.)

Lobstergirl wrote: "Does that mean you would move from a job with benefits to one without? I'd be careful about doing that, certainly. Would you be able to get health insurance through your husband's job? And what'..."

No, I mean I don't have benefits right now, so I would be willing to take a slight cut in pay to get a job that offers them. I just don't want to reduce it to the point where I end up in an even larger debt-hole than I am (or more accurately, we are) currently.

So it sounds like it would be a completely lateral move (not rising in terms of career promotion, or salary increase). Would your commuting costs change at all? If you are miserable and stressed out in your current job, it certainly could make sense to make a lateral move.

Budgeting can be quite simple Amber. Now it depends on what you are trying to accomplish. First know what your income will be, then you need to account for all of your current fixed costs like rent/home payment, car payment etc.. Once you have those deducted hopefully you have some disposable income, and from that you need to determine if you are going to put a certain $ amount or percentage aside for savings, and then the rest you have for food, gas/transportation, entertainment. I'm sure you have some more direct questions, so feel free to ask them.

Wait wait wait. There's NOTHING left.

i am an idiot with money. i will not even try to help on this thread

Lobstergirl wrote: "Does that mean you would move from a job with benefits to one without? I'd be careful about doing that, certainly. Would you be able to get health insurance through your husband's job? And what'..."

Yes, I agree with this.

My big issue right now is trying to figure out how much to save (which at the moment, is nil) and how much to devote to eliminating debt. I have significant student loan debt. So in your (read: everyone's) opinion, how long do you put off paying a huge debt in favor of "rainy day" savings?

And how important is your credit rating if you're not concerned with buying a house any time soon? I know it affects other purchases, but I know some people that will happily weaken their credit score to save, and others who are determined to keep it as high as possible but are unable to put anything aside because of it.

Amber wroteOk, so on a slightly different note: Does anyone have good budgeting advice that may seem obvious but people tend to overlook?

Try searching "budgeting workbook" on google and see what you get - there are some banks that put them up for free download. One thing you can do is list out all your credit cards, the APR, and what you owe.
Then pay the minimum on the lowest interest ones and as much as you can afford on the highest interest one.
$30, 000 is not a bad salary for an early job in a non-specialized field, as long as the rent etc. isn't too high in your area.

Within the last couple of years, I had to completely change how I dealt with money...

Debt sucks... it sucks so bad. Even if you don't care about your credit score (which I didn't, and I wish I would have), it is still advisable to get out from under any financial obligations that you can. That way when you ARE interested in buying a house, or a car, you're good to go and you won't find something you're in love with but can't qualify to get in to.

What do you plan to do with a "rainy day" fund? Is it for when you want to go on vacation or buy new furniture, or is it for emergencies?

Also, with regard to the credit score, more and more employers are running a credit check during the hiring process to see what kind of person they're getting.

I tried pasting a Excel spreadsheet to show you how debt is costing you money Amber, but it didn't format well here. But paying down interest bearing loans would be your best option in my opinion, but I would still put a small amount away for emergencies. 75-80% towards debt 20-25% towards savings. Just my thoughts.

RandomAnthony wrote: "Starting teacher pay is often around 30 grand."

In Utah it's about $22K.

Amber wrote: "Ok, so on a slightly different note: Does anyone have good budgeting advice that may seem obvious but people tend to overlook?"

PAY YOURSELF FIRST.

Compound interest can be your best friend, or your worst enemy.

Paying it on credit cards or other loans means you're paying a heck of a lot more for your "stuff" than you think.

Earning it on investments or savings can bring you wealth faster than anything other than a lottery or being an insider on a big IPO.

If your employer has a 401K or similar program, put in 5% MORE than you think you can afford. You'll find a way to get by.

The three most important things you should be doing are paying down debt (I include in this keeping up your good credit rating), saving for the short term (an emergency fund), and saving for the long term (retirement). (I'm leaving out saving for the middle term, which would include things like saving for a home, or for expensive private school for your kids.)

They used to say you should have 3 months salary squirreled away for an emergency fund. Since the recession started, they've upped it to 6 months. This may seem completely unreasonable for you, but do what you can.

Because neither of these jobs has a 401(k), you and your husband should each be contributing to an IRA. (You can contribute to a 401(k) and an IRA, if finances permitted you.) The reasons this is important are:

a) a traditional IRA is tax deductible - it will lower your taxable income.
b) all IRA growth is untaxed until you take it out at retirement.
c) as Phil said, compound interest can be a wonderful thing. No one knows what the stock market will do in the next few months, years, or ever, but historically it has been one of the best ways to build wealth.
d) if you don't save for retirement, you'll have to rely on Social Security, and who knows what size your monthly benefit will be by the time you reach retirement age.

If an IRA sounds totally unachievable, start small. Open one up, make whatever contribution you can afford. You can always adjust your contribution up or down. The point is to get started while it's early and you're young. Pick a good quality name brand investment firm, like T. Rowe Price, and pick one or two of their no-load growth funds. And then DO NOT TOUCH that money, ever, for any reason. Let it sit there forever.

I totally agree with Phil on "You'll find a way to get by." You really can push yourself to be a saver. You will be able to find ways to cut back on your expenses without being completely miserable. If you're buying $5 lattes and frappucinos, taking taxis, going to the movies every 3 days, you can cut some of that out. If you don't have a sense of where your money is going, keep track of all your expenses for 2-3 months. Every last penny...

I was very young when I realized I could spend an infinite amount of money and I can nickel and dime my self broke.

What works for me is having an 'allowance'. I draw my weekly 'allowance' from the ATM. This cash must cover gasoline, groceries, and pocket money (lunch,coffee, etc). For this to work, there can be no extra trips to the ATM, no cheating. When the cash is gone, no more spending. It forces me to prioritize,and give me a concrete reason to resist impulse purchases.

The first step is to marry rich.

Rich who?

I have a financial question about taxes, federal in particular.

My husband is American, works in the US, but lives in Canada. When I do my taxes, I must claim his income and file as married because he lives with me. He always filed single in the US. We were told last year to obtain International Tax Identification Numbers so he could claim both myself and our daughter and file as married. We did that. However, when he had his taxes done, it appears that he did not have to claim my income. Is this right? If you file as married you don’t have to claim your spouse’s income? The paperwork only requested my occupation- not my employer, nor my income. Just curious- I won’t let him spend the refund in case they want it back.

Pat wrote: "I was very young when I realized I could spend an infinite amount of money and I can nickel and dime my self broke.

What works for me is having an 'allowance'. I draw my weekly 'allowance' from t..."

I like the cash suggestion a lot, it's the nickels and dimes that do the real damage.

Amber our two best pieces of finanacial advice came from a young financial planner from Minneapolis, circa 1990.
1. Every month, save 10%, invest 10%, and give to charity 10%.
and, 2. When making a purchase, is it something you need or something you want. Are you buying that shirt/car/vacation simply because you can?

Helena wrote: "I have a financial question about taxes, federal in particular.

My husband is American, works in the US, but lives in Canada. When I do my taxes, I must claim his income and file as married bec..."

The across-the-border stuff may muddle the issue, but two U.S. citizens filing as "Married" most definitely must report the income of both.

If your income was earned in Canada it may not be required to be added to his U.S. tax filing because it wouldn't be subject to U.S. income tax.

Check with a professional.

Thanks Phil, that’s what I thought... I think the professional that he saw was perhaps not very familiar with the cross border issues. It seems odd that he wouldn’t have to claim my income at all. I’m going to try and find someone else to have a look at it.

I know the US taxes on everything Americans earn abroad, but if you're not a US citizen that clouds it.

Ok, so this is not really a financial question, although it is not totally unrelated, and I didn't know if it deserved its own thread.

Does anyone have advice for job hunting? Best places to look? Things that have helped you in the past? It's a craptastic market, I know, but sometimes you just have to take your chances.

I got one job (fundraiser for Human Services agency) by way of volunteering for the local AIDS Coalition, I found another job (Public Library Development Director) by doing fundraising for various causes (and serving on several volunteer boards like the Battered Women's Shelter.) The busier you are helping others who are less fortunate, the more you will learn and you will have opportunities leading to paid employment. Sorry if this sounds sanctimonious, but honestly, it worked out that way for me.

Many larger firms get all of their job applications online -- either from the their own HR page, or through an online application coordination outfit. I got my current job by applying online after searching the positions available listed there on the corporate website. That's the only way to get a non-executive job here in this company.

Larry wrote: "Many larger firms get all of their job applications online -- either from the their own HR page, or through an online application coordination outfit. I got my current job by applying online after..."

That's the only way?

The large companies I've worked with get a large number of people from referrals made by current employees. Networking is generally a FANTASTIC way to find employment, even for jobs that haven't yet been listed.

The only way.

Ugh, that is terrible, for me anyway. I don't have much of a personal network.

Amber, you might want to look at the website LinkedIn and putting your profile on there. I think it's a good way to start building your network and getting your credentials out there.

I have started making a few connections on LinkedIn; I don't know how significant it will be, but I know a few people, at least. Also, the CEO of my company was nice enough to revise my resume for me-he makes me sound more important than I probably am, but he's my reference, so at least there's someone to back it up. He's also the only person in the office that knows I'm trying to get out; I know they would make my life miserable if anyone else knew.

Moving in a different direction: any thoughts on debt consolidation?

The most efficient debt consolidation plan is bankruptcy. You consolidate them into gone. Even under Chapter 13, which makes you pay a portion of it back (whatever you can afford, if you have a good attorney). Oh, and it doesn't cover student loans.

But I'm guessing you don't want to go that route.

Nope, no bankruptcy for me hopefully. I'm trying to solve everything through budgeting and long-haul planning, but finding a few things that may help along the way would be nice, too. The problem is getting on track and staying there. Too many derailments lately.

Would it help at all to connect with TCers on LinkedIn?

That would be awesome Phil!

I'm there.

I think I may have come up with the worst plan ever. I really want to go back to school to finish up my English degree (I wasn't that far from having a double major before I had to leave) and possibly study library science. I'm thinking, if I can get at least some aid, I will get a part-time job, go back to school full-time and get a degree in a field I'm actually consistently interested in. I would use some of my loan money to pay off current non-student loan debt, so when I graduate the student loan debt will be the only debt remaining. However, I'm already in it pretty deep from my original degree, so I would owe even more, but my current debt would be on deferment while I'm in school. I'm not eligible for anything other than forbearance right now, and the interest is compounding like crazy. I have been applying for jobs for the last 9 months, and it's just a no-go right now, even in Northern VA, where the job market is still fairly strong.

This would be aided by the fact that my husband and I would be moving in with my mom and grandma and pooling our financial resources.

I think I'm just daydreaming, and this is a terrible idea, but somehow comforting.