Anonymous User wrote:My debt is currently 75K (on track for 100K at grad)
SO debt is currently 60K (on track for 100K at grad - will be a public school teacher so PSLF is possible if we file MFS in the future)
Married young (both under 25 still), straight from UG to Law/grad school with no familial support or funds to help, I'll be a 2L SA (market pay, expensive city), currently no emergency fund available
What's the best option for my SA funds? Should I avoid further debt? What's a good emergency fund to start out or where can I look to learn basics of finances like this? I'm just now realizing how lost I am on more advanced and long-term planning. I can effectively budget and live under means, but going into make these types of decisions has blown my mind the past few weeks.
The textbook advice is that you should have between 3 and 6 months of "gotta-have-it-to-sustain-life/shelter" money stashed in a highly liquid account (probably a savings account). The purpose of this is to keep you from a crisis situation where you balloon your total debt number by credit carding your emergency expenses away.
Also, let me also highlight something important: your emergency fund doesn't go into the market. That's not its role. You should never be looking to put your emergency fund cash into stocks/bonds/mutual funds. So, don't let there be any confusion on that front. Savings account!
So, what I recommend is you sit down with your spouse and hash out a no-shitter, this is what we need to bare bones our way through three months budget. Then, go get a savings account at a local credit union and put that total in there--never touch it unless you're in a literal jam (car accident, medical expenses, etc.) Then, if you have any additional funds remaining, you have a couple options:
Option 1 (most conservative): You could plus up that emergency fund closer to a 6 month total and give yourself some real peace of mind.
Option 2 (Moderately conservative): You could pay down some of the highest-interest-rate debt you currently have.
Option 3 (Not conservative): use the extra cash to fund your lifestyle for a handful of 3L months and thereby reduce your overall debt. (I call this not conservative because a lot of people see, for instance, $5K sitting in an account and go crazy buying shit. If you can avoid this temptation...this is another good use of the cash. Just be aware of the urge to lifestyle inflate because the cash is there and no one will say no.)
Finally, if you have some free time during 3LOL, there are a couple good resources for info about smart investing you'll want to be aware of come first-year associate time.
Good websites: boggleheads.com (have a "getting started" section, a forum, and a wiki), reddit.com/r/financialindependence (will put you in touch with hundreds of folks with a passion for saving/investing smartly/reducing expenses or frills)
Good books: A Random Walk Down Wall Street, Your Money or Your Life
That should get you on the right track. Good luck!