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January 17, 2012


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Hi JB,

If you don't mind me asking, what are your salaries approximately? Does your GF pay any rent?

Salary raises help but I wanted to see your income numbers before offering any advice on how too pay down debt faster.



Avoiding debt is certainly a killer goal. Sounds like you are off to a good start though!

It seems like your credit cards are making your life very stressful, my advice is for you is to pay them off using the company stock options of 4K which is the same amount of debt you owe. Then you can build the stock account back up faster and save up for the ring by applying the same amount of the credit card payment to a ring fund. In about 6 months you should have a good amount saved up to apply towards the ring. You will need about 4-6 Thousand for a decent ring. Emotionally you will feel much better getting rid of the credit card debt before buying an expensive ring. Beleive me.

Thanks for sharing, JB.

Regarding your Masters... your company will only pay $5K per year? Seems really low. Many engineering schools charge up to $5K per class, especially if you opt to do it online.

I would double check on the reimbursement, especially if your company is well known and established in the industrial field.

My income is around the $60K mark and hers is around $49K.

I wouldn't let the cost of a ring or getting the "right" ring get in the way of getting married. I would move ahead and make it official. It has only benefited me (financially, emotionally).

Don't fall into the trap of thinking that a ring (or wedding for that matter) needs to cost a boatload.

4-6 thousand for a "decent ring" is totally bogus. You know your girlfriend and your situation better than anyone, do what feels right to you, not society.

It seems like the first thing you need to do is start tracking your spending. On the surface, it seems like you should have much more money than you do so money is bleeding out somewhere.

You might want to try if you haven't already. It will really show you where your money is going, and you can set up a budget using it.

You may consider trying to get a refinance on that car if your credit permits that. I did that about a year ago on a car I used to own. I went from 7.8% to 1.99%. I owed much more (~$25k) but it saved me about $20/month and shortened the loan by 12 months. Absolutely worth it. What I've come to realize is that its not cutting one big thing out. Its cutting multiple things by just a little that helps you save money while maintain your quality of life.

How much money is left each month after expenses paid and what are they?

Josh, thanks for sharing. I also work in a small northeast city. It is certainly expensive and you don't talk much about lifestyle. Do you eat out a lot? I know I did when I was in my 20s. Dunkin donuts in the morning? These small things add up.

The real point is this: my grandfather gave me this advice when it comes to saving/paying off debt. If you use what's left to save, there's usually nothing left. So pay yourself first! But what you're doing is hard to change. So start by committing to just a 50 or 100 dollar extra payment. Send it in separately, immediately after you are paid. Then pay the bill on time as you have been. Then, at the end if you have extra, great, use that too. But if you run out, you know you at least did 50 or 100. Then increase the amount over time, especially with raises.

Good luck!

Hi Josh,

I think you should be able to retire your debt in 1-2 years with a good focus on using all savings to pay down debt, and then be able to build an emergency fund in 6 months.

Keep focusing on securing raises in your job.

I don't know the market where you live, but could find something much cheaper for rent + parking, that could help improve cash flow more.


Agree with the others to not focus on the ring so much. Also not to worry about getting your "financial house in order" prior to marriage as you put it. I definitely agree with sitting down together and going over budget and goals. But a wedding should not be a significant cost.

Tackle the credit card debt first. Then start putting extra towards your car. Two years to pay of $6k of car loan debt seems kind of a long time on an engineer's salary.

Be sure that getting the engineer master's will pay off (don't go to an online school like someone above mentioned). Do people in high up positions at your company have master's degrees? Did people who got their degrees while working there actually see a salary bump as a result? Oftentimes in many industries an engineer can make up in a few years of experience for the supposed "salary bump" of a master's. You might be better off waiting and get an MBA sometime later and going into management (again assuming you know you're at a place or going to a place where the MBA will pay off). Don't get a degree just to tick it off your bucket list.

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