One of these days I'm going to make a spreadsheet with projected income, expenses, and actual tax tables so I can sleep at little better knowing that I'm not crazy for doing this.
Here's a screenshot of my draft. http://imgur.com/a/krtQk
- I max out my 401k contribution at $20k a year (which is where the max annual contribution will probably be by then) and I get an employer match of my 401k contributions up to 5% of my gross salary.
- I put a few grand a year to a Roth IRA or other savings vehicle that I fund with pre-tax dollars as well as few grand in pre-tax dollars to my flexible spending account for health expenses.
- A 35% tax rate.
- Additional savings of $1K a month from my after-tax income in year 1, increasing steadily each year.
- Not factoring in bonuses, because it just makes people plan horribly. I learned that the hard way. Plus, the first year bonus is a stub year bonus, not the full amount. And if you lateral to another firm at some point but you get the timing wrong, you might lose out on a bonus from your old firm but not get the full-year bonus from the new firm.
-Assumes I take advantage of the full six-month grace period on loan repayment so I can aggressively save a bit in the summer and fall of 2020 before starting repayment basically at the start of 2021 (or in Nov/Dec 2020). That's why the spreadsheet starts with "2021".
In year 1, I'm left with $4,300 a month for my actual life (rent, discretionary spending, charitable giving, travel) and $3,100 per month for student loans.
If anyone's curious, this is based on financing my education with:
- My scholarship/tuition grant from CLS (basically a Butler)
-$12.5K saved each of my two summers (the most you can expect to save toward school expenses if you make $3.5K pre-tax per week, work 8 weeks, get taxed, and pay rent/living expenses over the summers using your summer income)
-Student loans for the rest
Can send you the spreadsheet if you want, though I'm sure yours would be better.