Junior Associates- How are you budgeting? Forum

[Anonymous User]

Trying to understand how people are budgeting as junior associates.

Market and salary:
Rent:
401(k) Contribution/Retirement:
Health Spending (Insurance, HSA etc.)
Transportation:
Student Loan Payments:
Savings:

Please feel free to add other categories that you think are important.

[Anonymous User]

Market and salary: Fed, 90k, Secondardy market.
Rent: We own the home. Mortgage is about 2800. We are a two person salary home and make around 180k.
401(k) Contribution/Retirement: Max out. So about 20k each.
Health Spending (Insurance, HSA etc.)- Fed govt, so idk, cheap? I think it costs me like 40 bucks a month or something and I get a pretty good one.
Transportation: We own our cars. She doesn't really drive. I pay like 30 a week for gas.
Student Loan Payments: She doesn't have any. I owe 40k. Make min payments.
Savings: Around 60k. Looking to invest more of our money though.

[Anonymous User]

Market and salary: NYC, 180k
Rent: $1500 (split with wife)
401(k) Contribution/Retirement: $0
Health Spending (Insurance, HSA etc.): Insurance is like $85 per month and I put $50 a month into HSA.
Transportation: $240 pretax for public transit, $180 per month for car insurance + parking.
Student Loan Payments: $0 thanks to the pause.
Savings: $75k, with $25k going toward my loans when they restart.

I take home just under $10k a month.

I try to save $7k a month. I know I should be investing/putting money into 401k. I will eventually, but right now I’m trying to stockpile a bunch of cash.

[Anonymous User]

Market and salary: Midwest secondary market, 230k
Rent: ~1500
401(k) Contribution/Retirement: max per year (20k)
Health Spending (Insurance, HSA etc.): honestly can't remember what my monthly cost is (I think ~350)
Transportation: own paid-off car
Student Loan Payments: ~25,000 (pre-any loan forgiveness, which I was eligible for)
Savings: 100k - feels like my saving account is getting unnecessarily large; need to look for investments

[thisismytlsuername]

Market and salary: NYC, 180k
Rent: $1500 (split with wife)
401(k) Contribution/Retirement: $0
Health Spending (Insurance, HSA etc.): Insurance is like $85 per month and I put $50 a month into HSA.
Transportation: $240 pretax for public transit, $180 per month for car insurance + parking.
Student Loan Payments: $0 thanks to the pause.
Savings: $75k, with $25k going toward my loans when they restart.

I take home just under $10k a month.

I try to save $7k a month. I know I should be investing/putting money into 401k. I will eventually, but right now I’m trying to stockpile a bunch of cash.

Jesus Christ lawyers are bad with money.

[Anonymous User]

Market and salary: NYC, 180k
Rent: $1500 (split with wife)
401(k) Contribution/Retirement: $0
Health Spending (Insurance, HSA etc.): Insurance is like $85 per month and I put $50 a month into HSA.
Transportation: $240 pretax for public transit, $180 per month for car insurance + parking.
Student Loan Payments: $0 thanks to the pause.
Savings: $75k, with $25k going toward my loans when they restart.

I take home just under $10k a month.

I try to save $7k a month. I know I should be investing/putting money into 401k. I will eventually, but right now I’m trying to stockpile a bunch of cash.

Jesus Christ lawyers are bad with money.

Saving 7k per month on that salary is really good...

[Anonymous User]

Market and salary: NYC, 180k
Rent: $1500 (split with wife)
401(k) Contribution/Retirement: $0
Health Spending (Insurance, HSA etc.): Insurance is like $85 per month and I put $50 a month into HSA.
Transportation: $240 pretax for public transit, $180 per month for car insurance + parking.
Student Loan Payments: $0 thanks to the pause.
Savings: $75k, with $25k going toward my loans when they restart.

I take home just under $10k a month.

I try to save $7k a month. I know I should be investing/putting money into 401k. I will eventually, but right now I’m trying to stockpile a bunch of cash.

Jesus Christ lawyers are bad with money.

Saving 7k per month on that salary is really good...

I took it as them saying I’m bad with money since I’m not investing. I know that I should, and I plan to do so. But I’m a stub year and want to have a certain amount in savings before turning to investing. I’m able to contribute to my 401k starting in January, so I’m going to start there.

[Anonymous User]

Market and salary: NYC, 180k
Rent: $1500 (split with wife)
401(k) Contribution/Retirement: $0
Health Spending (Insurance, HSA etc.): Insurance is like $85 per month and I put $50 a month into HSA.
Transportation: $240 pretax for public transit, $180 per month for car insurance + parking.
Student Loan Payments: $0 thanks to the pause.
Savings: $75k, with $25k going toward my loans when they restart.

I take home just under $10k a month.

I try to save $7k a month. I know I should be investing/putting money into 401k. I will eventually, but right now I’m trying to stockpile a bunch of cash.

Is this health insurance through your firm? My option through the firm is like $300/month for a single person jfc...

[Anonymous User]

Market and salary: CA, $225,000 + bonus (assuming I hit hours)
Rent: Own home. Mortgage, property taxes, and insurance are like $4,400
401(k) Contribution/Retirement: $0 currently.
Health Spending (Insurance, HSA etc.): Middle of the road plan. About $600 pre-tax for me and the wife.
Transportation: Own two cars. Car insurance is like $1,000 a year; gas is $200-$350 per month.
Student Loan Payments: $3K per month currently going into a HYSA until payments resume. Hoping to pay them off by June 2023.
Savings: Around 30k. Trying to save a little over $3K per month. Kiddo on the way...

[Anonymous User]

Market and salary: NYC, 180k
Rent: $1500 (split with wife)
401(k) Contribution/Retirement: $0
Health Spending (Insurance, HSA etc.): Insurance is like $85 per month and I put $50 a month into HSA.
Transportation: $240 pretax for public transit, $180 per month for car insurance + parking.
Student Loan Payments: $0 thanks to the pause.
Savings: $75k, with $25k going toward my loans when they restart.

I take home just under $10k a month.

I try to save $7k a month. I know I should be investing/putting money into 401k. I will eventually, but right now I’m trying to stockpile a bunch of cash.

Is this health insurance through your firm? My option through the firm is like $300/month for a single person jfc...

Sheesh. Yeah it is. I have our high deductible plan and then vision/dental.

[Anonymous User]

Market and salary: tertiary, ~200k and single.
Rent: about $2k after all utilities.
401(k) Contribution/Retirement: max 401(k), max backdoor Roth, remainder of unspent paycheck into a brokerage account.
Health Spending (Insurance, HSA etc.): max HSA, healthcare fully covered.
Transportation: about $600 per month all in.
Student Loan Payments: $0 for now, will be fairly significant when they kick in and replace the amount currently going into my brokerage account.
Savings: $30k in true savings above 3% interest. That's all I need for my lifestyle/market as an emergency fund. Over $200k in investment accounts at just 2 years of practice for an idea of my spending habits...

[3Lapplicant]

Bumping

[Anonymous User]

Market and salary: Major market; $285k
Rent: just bought - mortgage + insurance + taxes = about $4000
401(k) Contribution/Retirement: 5% -- was doing 15% for awhile, but paused to pay for some major home improvements and started back up at 5% since those are winding down but still there.
Health Spending (Insurance, HSA etc.): $1200 family plan
Transportation: about $300
Student Loan Payments: $0 - no debt
Savings: 50k cash; 425k other investments
Childcare: about $30k/yr

[Anonymous User]

Market and salary: NYC, $215K stub
Rent: $3K per month
401(k) Contribution/Retirement: put 8% pre-tax into 401k; once I've furnished my apartment (and bought Xmas gifts etc.), I plan to start throwing a lot more at a taxable brokerage account
Health Spending (Insurance, HSA etc.) ~$375 per month across HDHP, HSA, and dental
Transportation: put $70 pre-tax toward MetroCard, plus another ~$50ish per month in taxis/Uber
Student Loan Payments: None
Savings: $130K

[Anonymous User]

Market and salary: Non-NYC, 215k, Stub
Rent: 3k
401(k) Contribution: 6%
Health Spending: How do people figure this out? I know my plan has $250 deductible, but not sure how to figure out monthly spending on health
Transportation: None
Student Loan Payments: 2k per month, on average, but sometimes more; trying to be aggressive about this
Savings: 5k (did not work before law school, and I put whatever savings I had toward paying down loans)

Would appreciate any feedback on how to better take advantage of income!

[Sackboy]

Market and salary: Non-NYC, 215k, Stub
Rent: 3k
401(k) Contribution: 6%
Health Spending: How do people figure this out? I know my plan has $250 deductible, but not sure how to figure out monthly spending on health
Transportation: None
Student Loan Payments: 2k per month, on average, but sometimes more; trying to be aggressive about this
Savings: 5k (did not work before law school, and I put whatever savings I had toward paying down loans)

Would appreciate any feedback on how to better take advantage of income!

Max your 401(k) and HSA. Use your HSA as an extension of your 401(k) and not to actually pay medical expenses. If you invest $26,350/yr. (the combined 2023 401(k)+HSA max) for 40yrs into your 401(k)+HSA and make an 8% average market return (average market return for the last 50yrs has been 10-11%) and did NOTHING else, you'd have $6.8 million to withdraw from at that point.

Also build your emergency fund to be 4-6 months of liquid reserves that are not subject to the whims of the market (i.e., cash or bonds). I keep about 2 months in cash and 4 months in I Bonds. I Bonds can't be cashed before a year, so they are not a good idea to go all in on right away. You can ease into them over time. They're pegged to inflation, so they won't devalue like your cash and turning them into $$$ takes 24-48 hours at most (quick enough where you can just float something on a credit card for a day or two if needed).

Pay off your credit card in full every month.

For 401(k) and general market investing, just buy an index fund that tracks the S&P 500 and has a low expense ratio (e.g., VOO). You don't need to be fancy. You don't need to "diversify" (VOO is already 500 different companies that have domestic and international presences and a wide variety of products in a wide variety of industries). Then, stack stack stack. Never panic sell. Always hold. It'll bounce back, even if it's down 30%.

The build will be slow, but it is the tried and true way to becoming financially secure

[Anonymous User]

Market and salary: Non-NYC, 215k, Stub
Rent: 3k
401(k) Contribution: 6%
Health Spending: How do people figure this out? I know my plan has $250 deductible, but not sure how to figure out monthly spending on health
Transportation: None
Student Loan Payments: 2k per month, on average, but sometimes more; trying to be aggressive about this
Savings: 5k (did not work before law school, and I put whatever savings I had toward paying down loans)

Would appreciate any feedback on how to better take advantage of income!

Max your 401(k) and HSA. Use your HSA as an extension of your 401(k) and not to actually pay medical expenses. If you invest $26,350/yr. (the combined 2023 401(k)+HSA max) for 40yrs into your 401(k)+HSA and make an 8% average market return (average market return for the last 50yrs has been 10-11%) and did NOTHING else, you'd have $6.8 million to withdraw from at that point.

Also build your emergency fund to be 4-6 months of liquid reserves that are not subject to the whims of the market (i.e., cash or bonds). I keep about 2 months in cash and 4 months in I Bonds. I Bonds can't be cashed before a year, so they are not a good idea to go all in on right away. You can ease into them over time. They're pegged to inflation, so they won't devalue like your cash and turning them into $$$ takes 24-48 hours at most (quick enough where you can just float something on a credit card for a day or two if needed).

Pay off your credit card in full every month.

For 401(k) and general market investing, just buy an index fund that tracks the S&P 500 and has a low expense ratio (e.g., VOO). You don't need to be fancy. You don't need to "diversify" (VOO is already 500 different companies that have domestic and international presences and a wide variety of products in a wide variety of industries). Then, stack stack stack. Never panic sell. Always hold. It'll bounce back, even if it's down 30%.

The build will be slow, but it is the tried and true way to becoming financially secure

Awesome advice, thank you. Regarding 401(k) and HSA max: how do I factor student loan payments into this? I've been told that I should hold off on everything else until the loans are paid.

[Anonymous User]

Market and salary: Non-NYC, 215k, Stub
Rent: 3k
401(k) Contribution: 6%
Health Spending: How do people figure this out? I know my plan has $250 deductible, but not sure how to figure out monthly spending on health
Transportation: None
Student Loan Payments: 2k per month, on average, but sometimes more; trying to be aggressive about this
Savings: 5k (did not work before law school, and I put whatever savings I had toward paying down loans)

Would appreciate any feedback on how to better take advantage of income!

Max your 401(k) and HSA. Use your HSA as an extension of your 401(k) and not to actually pay medical expenses. If you invest $26,350/yr. (the combined 2023 401(k)+HSA max) for 40yrs into your 401(k)+HSA and make an 8% average market return (average market return for the last 50yrs has been 10-11%) and did NOTHING else, you'd have $6.8 million to withdraw from at that point.

Also build your emergency fund to be 4-6 months of liquid reserves that are not subject to the whims of the market (i.e., cash or bonds). I keep about 2 months in cash and 4 months in I Bonds. I Bonds can't be cashed before a year, so they are not a good idea to go all in on right away. You can ease into them over time. They're pegged to inflation, so they won't devalue like your cash and turning them into $$$ takes 24-48 hours at most (quick enough where you can just float something on a credit card for a day or two if needed).

Pay off your credit card in full every month.

For 401(k) and general market investing, just buy an index fund that tracks the S&P 500 and has a low expense ratio (e.g., VOO). You don't need to be fancy. You don't need to "diversify" (VOO is already 500 different companies that have domestic and international presences and a wide variety of products in a wide variety of industries). Then, stack stack stack. Never panic sell. Always hold. It'll bounce back, even if it's down 30%.

The build will be slow, but it is the tried and true way to becoming financially secure

Awesome advice, thank you. Regarding 401(k) and HSA max: how do I factor student loan payments into this? I've been told that I should hold off on everything else until the loans are paid.

Stop paying your student loans. Interest is at 0% and could stay that way until September 2023. That gives you 9 months to stack cash without having to worry about loans.

[Wubbles]

Market and salary: Non-NYC, 215k, Stub
Rent: 3k
401(k) Contribution: 6%
Health Spending: How do people figure this out? I know my plan has $250 deductible, but not sure how to figure out monthly spending on health
Transportation: None
Student Loan Payments: 2k per month, on average, but sometimes more; trying to be aggressive about this
Savings: 5k (did not work before law school, and I put whatever savings I had toward paying down loans)

Would appreciate any feedback on how to better take advantage of income!

Max your 401(k) and HSA. Use your HSA as an extension of your 401(k) and not to actually pay medical expenses. If you invest $26,350/yr. (the combined 2023 401(k)+HSA max) for 40yrs into your 401(k)+HSA and make an 8% average market return (average market return for the last 50yrs has been 10-11%) and did NOTHING else, you'd have $6.8 million to withdraw from at that point.

Also build your emergency fund to be 4-6 months of liquid reserves that are not subject to the whims of the market (i.e., cash or bonds). I keep about 2 months in cash and 4 months in I Bonds. I Bonds can't be cashed before a year, so they are not a good idea to go all in on right away. You can ease into them over time. They're pegged to inflation, so they won't devalue like your cash and turning them into $$$ takes 24-48 hours at most (quick enough where you can just float something on a credit card for a day or two if needed).

Pay off your credit card in full every month.

For 401(k) and general market investing, just buy an index fund that tracks the S&P 500 and has a low expense ratio (e.g., VOO). You don't need to be fancy. You don't need to "diversify" (VOO is already 500 different companies that have domestic and international presences and a wide variety of products in a wide variety of industries). Then, stack stack stack. Never panic sell. Always hold. It'll bounce back, even if it's down 30%.

The build will be slow, but it is the tried and true way to becoming financially secure

Awesome advice, thank you. Regarding 401(k) and HSA max: how do I factor student loan payments into this? I've been told that I should hold off on everything else until the loans are paid.

Stop paying your student loans. Interest is at 0% and could stay that way until September 2023. That gives you 9 months to stack cash without having to worry about loans.

In addition to this, even once student loan payments kick in, you should be maxing 401(k) and HSA contributions before going beyond the minimum student loan payments required on the 10 year repayment plan. Your tax leveraged space is limited by year and once it's gone you can't go back and top it up anytime soon.

[Anonymous User]

Market and salary: Non-NYC, 215k, Stub
Rent: 3k
401(k) Contribution: 6%
Health Spending: How do people figure this out? I know my plan has $250 deductible, but not sure how to figure out monthly spending on health
Transportation: None
Student Loan Payments: 2k per month, on average, but sometimes more; trying to be aggressive about this
Savings: 5k (did not work before law school, and I put whatever savings I had toward paying down loans)

Would appreciate any feedback on how to better take advantage of income!

Max your 401(k) and HSA. Use your HSA as an extension of your 401(k) and not to actually pay medical expenses. If you invest $26,350/yr. (the combined 2023 401(k)+HSA max) for 40yrs into your 401(k)+HSA and make an 8% average market return (average market return for the last 50yrs has been 10-11%) and did NOTHING else, you'd have $6.8 million to withdraw from at that point.

Also build your emergency fund to be 4-6 months of liquid reserves that are not subject to the whims of the market (i.e., cash or bonds). I keep about 2 months in cash and 4 months in I Bonds. I Bonds can't be cashed before a year, so they are not a good idea to go all in on right away. You can ease into them over time. They're pegged to inflation, so they won't devalue like your cash and turning them into $$$ takes 24-48 hours at most (quick enough where you can just float something on a credit card for a day or two if needed).

Pay off your credit card in full every month.

For 401(k) and general market investing, just buy an index fund that tracks the S&P 500 and has a low expense ratio (e.g., VOO). You don't need to be fancy. You don't need to "diversify" (VOO is already 500 different companies that have domestic and international presences and a wide variety of products in a wide variety of industries). Then, stack stack stack. Never panic sell. Always hold. It'll bounce back, even if it's down 30%.

The build will be slow, but it is the tried and true way to becoming financially secure

Awesome advice, thank you. Regarding 401(k) and HSA max: how do I factor student loan payments into this? I've been told that I should hold off on everything else until the loans are paid.

Stop paying your student loans. Interest is at 0% and could stay that way until September 2023. That gives you 9 months to stack cash without having to worry about loans.

In addition to this, even once student loan payments kick in, you should be maxing 401(k) and HSA contributions before going beyond the minimum student loan payments required on the 10 year repayment plan. Your tax leveraged space is limited by year and once it's gone you can't go back and top it up anytime soon.

Not OP but isn't there a case to be made for paying as much student debt down before interest kicks in? Interest can accumulate quickly.

[Wubbles]

Market and salary: Non-NYC, 215k, Stub
Rent: 3k
401(k) Contribution: 6%
Health Spending: How do people figure this out? I know my plan has $250 deductible, but not sure how to figure out monthly spending on health
Transportation: None
Student Loan Payments: 2k per month, on average, but sometimes more; trying to be aggressive about this
Savings: 5k (did not work before law school, and I put whatever savings I had toward paying down loans)

Would appreciate any feedback on how to better take advantage of income!

Max your 401(k) and HSA. Use your HSA as an extension of your 401(k) and not to actually pay medical expenses. If you invest $26,350/yr. (the combined 2023 401(k)+HSA max) for 40yrs into your 401(k)+HSA and make an 8% average market return (average market return for the last 50yrs has been 10-11%) and did NOTHING else, you'd have $6.8 million to withdraw from at that point.

Also build your emergency fund to be 4-6 months of liquid reserves that are not subject to the whims of the market (i.e., cash or bonds). I keep about 2 months in cash and 4 months in I Bonds. I Bonds can't be cashed before a year, so they are not a good idea to go all in on right away. You can ease into them over time. They're pegged to inflation, so they won't devalue like your cash and turning them into $$$ takes 24-48 hours at most (quick enough where you can just float something on a credit card for a day or two if needed).

Pay off your credit card in full every month.

For 401(k) and general market investing, just buy an index fund that tracks the S&P 500 and has a low expense ratio (e.g., VOO). You don't need to be fancy. You don't need to "diversify" (VOO is already 500 different companies that have domestic and international presences and a wide variety of products in a wide variety of industries). Then, stack stack stack. Never panic sell. Always hold. It'll bounce back, even if it's down 30%.

The build will be slow, but it is the tried and true way to becoming financially secure

Awesome advice, thank you. Regarding 401(k) and HSA max: how do I factor student loan payments into this? I've been told that I should hold off on everything else until the loans are paid.

Stop paying your student loans. Interest is at 0% and could stay that way until September 2023. That gives you 9 months to stack cash without having to worry about loans.

In addition to this, even once student loan payments kick in, you should be maxing 401(k) and HSA contributions before going beyond the minimum student loan payments required on the 10 year repayment plan. Your tax leveraged space is limited by year and once it's gone you can't go back and top it up anytime soon.

Not OP but isn't there a case to be made for paying as much student debt down before interest kicks in? Interest can accumulate quickly.

Mathematically or Economically? No, especially not up until the day interest kicks in. After interest kicks in, in the long term it is better to take advantage of the tax leveraged space in your 401k and HSA. Money that would otherwise go to a taxable brokerage can go towards student loans after interest starts accumulating (I suppose that money could immediately go towards it, but in the meantime having extra cash instead of paying off a 0% loan is preferable).

[Anonymous User]

Debt repayment has a psychological component. I repaid my mortgage earlier this year. Objectively it was the wrong call given our low fixed interest rates, versus the long term returns in the stock market. But even now I walk around feeling so much lighter and I have zero regrets in taking that approach.

Debt can make you feel tied to your job. Taking on (or retaining) low interest debt may help to build long term wealth, but it usually comes at the cost of cash flow, which makes it more difficult to plan for early retirement or a lower income, better lifestyle role.

I strongly agree with the recommendation to first max out your retirement accounts. Once you have done so, I would be aggressive in paying off my student debt to the extent I could.

[Anonymous User]

Market and salary: Non-NYC, 215k, Stub
Rent: 3k
401(k) Contribution: 6%
Health Spending: How do people figure this out? I know my plan has $250 deductible, but not sure how to figure out monthly spending on health
Transportation: None
Student Loan Payments: 2k per month, on average, but sometimes more; trying to be aggressive about this
Savings: 5k (did not work before law school, and I put whatever savings I had toward paying down loans)

Would appreciate any feedback on how to better take advantage of income!

Max your 401(k) and HSA. Use your HSA as an extension of your 401(k) and not to actually pay medical expenses. If you invest $26,350/yr. (the combined 2023 401(k)+HSA max) for 40yrs into your 401(k)+HSA and make an 8% average market return (average market return for the last 50yrs has been 10-11%) and did NOTHING else, you'd have $6.8 million to withdraw from at that point.

Also build your emergency fund to be 4-6 months of liquid reserves that are not subject to the whims of the market (i.e., cash or bonds). I keep about 2 months in cash and 4 months in I Bonds. I Bonds can't be cashed before a year, so they are not a good idea to go all in on right away. You can ease into them over time. They're pegged to inflation, so they won't devalue like your cash and turning them into $$$ takes 24-48 hours at most (quick enough where you can just float something on a credit card for a day or two if needed).

Pay off your credit card in full every month.

For 401(k) and general market investing, just buy an index fund that tracks the S&P 500 and has a low expense ratio (e.g., VOO). You don't need to be fancy. You don't need to "diversify" (VOO is already 500 different companies that have domestic and international presences and a wide variety of products in a wide variety of industries). Then, stack stack stack. Never panic sell. Always hold. It'll bounce back, even if it's down 30%.

The build will be slow, but it is the tried and true way to becoming financially secure

Awesome advice, thank you. Regarding 401(k) and HSA max: how do I factor student loan payments into this? I've been told that I should hold off on everything else until the loans are paid.

OP non-NYC stub - thanks for advice. I have option to put money into 401(k) pre-tax deferral, and then Roth 401(k) distribution. I know my firm also does mega back door Roth, but I have no idea what that is and how it works. Should I be making contributions to Roth 401(k)? And yes I am as clueless about money as it seems.

[Anonymous User]

Market and salary: Non-NYC, 215k, Stub
Rent: 3k
401(k) Contribution: 6%
Health Spending: How do people figure this out? I know my plan has $250 deductible, but not sure how to figure out monthly spending on health
Transportation: None
Student Loan Payments: 2k per month, on average, but sometimes more; trying to be aggressive about this
Savings: 5k (did not work before law school, and I put whatever savings I had toward paying down loans)

Would appreciate any feedback on how to better take advantage of income!

Max your 401(k) and HSA. Use your HSA as an extension of your 401(k) and not to actually pay medical expenses. If you invest $26,350/yr. (the combined 2023 401(k)+HSA max) for 40yrs into your 401(k)+HSA and make an 8% average market return (average market return for the last 50yrs has been 10-11%) and did NOTHING else, you'd have $6.8 million to withdraw from at that point.

Also build your emergency fund to be 4-6 months of liquid reserves that are not subject to the whims of the market (i.e., cash or bonds). I keep about 2 months in cash and 4 months in I Bonds. I Bonds can't be cashed before a year, so they are not a good idea to go all in on right away. You can ease into them over time. They're pegged to inflation, so they won't devalue like your cash and turning them into $$$ takes 24-48 hours at most (quick enough where you can just float something on a credit card for a day or two if needed).

Pay off your credit card in full every month.

For 401(k) and general market investing, just buy an index fund that tracks the S&P 500 and has a low expense ratio (e.g., VOO). You don't need to be fancy. You don't need to "diversify" (VOO is already 500 different companies that have domestic and international presences and a wide variety of products in a wide variety of industries). Then, stack stack stack. Never panic sell. Always hold. It'll bounce back, even if it's down 30%.

The build will be slow, but it is the tried and true way to becoming financially secure

Awesome advice, thank you. Regarding 401(k) and HSA max: how do I factor student loan payments into this? I've been told that I should hold off on everything else until the loans are paid.

Stop paying your student loans. Interest is at 0% and could stay that way until September 2023. That gives you 9 months to stack cash without having to worry about loans.

In addition to this, even once student loan payments kick in, you should be maxing 401(k) and HSA contributions before going beyond the minimum student loan payments required on the 10 year repayment plan. Your tax leveraged space is limited by year and once it's gone you can't go back and top it up anytime soon.

Not OP but isn't there a case to be made for paying as much student debt down before interest kicks in? Interest can accumulate quickly.

I don’t really think so. If you really want to take advantage of zero interest, each month you could always take what you’d pay on your student loan account, put it into a bank account, and let it sit there until interest starts up again. I have a chunk of money that I’m going to pay on my loans the second that interest starts back up. Until that point though. there’s really no reason to actually make the payments. You’re better off holding onto the chunk of money until payments restart.

[Hick4Life]

Market and salary: Non-NYC, 215k, Stub
Rent: 3k
401(k) Contribution: 6%
Health Spending: How do people figure this out? I know my plan has $250 deductible, but not sure how to figure out monthly spending on health
Transportation: None
Student Loan Payments: 2k per month, on average, but sometimes more; trying to be aggressive about this
Savings: 5k (did not work before law school, and I put whatever savings I had toward paying down loans)

Would appreciate any feedback on how to better take advantage of income!

Max your 401(k) and HSA. Use your HSA as an extension of your 401(k) and not to actually pay medical expenses. If you invest $26,350/yr. (the combined 2023 401(k)+HSA max) for 40yrs into your 401(k)+HSA and make an 8% average market return (average market return for the last 50yrs has been 10-11%) and did NOTHING else, you'd have $6.8 million to withdraw from at that point.

Also build your emergency fund to be 4-6 months of liquid reserves that are not subject to the whims of the market (i.e., cash or bonds). I keep about 2 months in cash and 4 months in I Bonds. I Bonds can't be cashed before a year, so they are not a good idea to go all in on right away. You can ease into them over time. They're pegged to inflation, so they won't devalue like your cash and turning them into $$$ takes 24-48 hours at most (quick enough where you can just float something on a credit card for a day or two if needed).

Pay off your credit card in full every month.

For 401(k) and general market investing, just buy an index fund that tracks the S&P 500 and has a low expense ratio (e.g., VOO). You don't need to be fancy. You don't need to "diversify" (VOO is already 500 different companies that have domestic and international presences and a wide variety of products in a wide variety of industries). Then, stack stack stack. Never panic sell. Always hold. It'll bounce back, even if it's down 30%.

The build will be slow, but it is the tried and true way to becoming financially secure

Awesome advice, thank you. Regarding 401(k) and HSA max: how do I factor student loan payments into this? I've been told that I should hold off on everything else until the loans are paid.

Stop paying your student loans. Interest is at 0% and could stay that way until September 2023. That gives you 9 months to stack cash without having to worry about loans.

In addition to this, even once student loan payments kick in, you should be maxing 401(k) and HSA contributions before going beyond the minimum student loan payments required on the 10 year repayment plan. Your tax leveraged space is limited by year and once it's gone you can't go back and top it up anytime soon.

Not OP but isn't there a case to be made for paying as much student debt down before interest kicks in? Interest can accumulate quickly.

I don’t really think so. If you really want to take advantage of zero interest, each month you could always take what you’d pay on your student loan account, put it into a bank account, and let it sit there until interest starts up again. I have a chunk of money that I’m going to pay on my loans the second that interest starts back up. Until that point though. there’s really no reason to actually make the payments. You’re better off holding onto the chunk of money until payments restart.

I'm doing this, but since it looks like we're not in any danger of interest starting until June I'll probably put it into an I-Bond or high interest CD with a 6 month term.