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May 06, 2013


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Wow. Nice to see someone not wasting such a gift.

I kind of like the idea of you even saving for the house down payment yourself giving how financially independent you are despite the gift. But I guess it would always be smartest to max out every retirement vehicle you can (you're investment income is already greatly effecting your taxes) and that may require using the future gifts for that while you separately save for the downpayment. I went for many years without good retirement acct options (no 401k) and so accumulated a lot of non-ret investments which I am now 'moving' into ret. accounts with the help of a solo Roth 401k/SEP.

And learn from your dad as much as you can about investing, this needs to move toward you managing the money and him supervising. He's obviously someone you could learn a lot from and who would love to teach you.


You are in incredible shape. I don't think you have to worry one bit about being more frugal. You are very disciplined and clearly have the mindset that will keep you on the path to financial security. The greatest impact in your future will probably be who you decide to marry and their thoughts about money.

While you will want to be more set (marriage, career,etc) before making a decision on a house, it probably makes good sense to at least make this a financial focus as it can take awhile to build up funds for a substantial downpayment, furnishings, etc.

Being gifted that kind of money is not a bad problem to have and it sounds like you're really keeping your head on straight with it without relying on it too heavily.
What other lessons in frugality do you need? Sounds like you're doing a lot already - living with roommates, riding a bike, no going out to eat too often. If I were in your boat I'd try and set out some life goals as to what you want to accomplish because you have a hue head start and may be a lot closer to financial independence than you think.

Given your passive income, great idea to sock a huge percentage of your paid income into the 401k. You don't need it today to live; might as well defer the taxes on it. I think it would make sense to contribute the max to an IRA too, even if you can't deduct your contribution.

One minor thought on living more frugally: I suspect you have carsharing in your area. Since you're already set to commute without using a car, perhaps you can sell your car, join a carsharing organization, and save some money (and the time required to deal with owning a car).

Your expenses look like you're already living a quite frugal lifestyle--good for you! Except for rock climbing, I don't see expenses for entertainment, 'clubbing,' etc. Is this accurate? Unusual for a 20-something.

If I were you I'd be looking to set myself up to live comfortably on investment income so that I could pursue what interested me with respect to 'career' without regard to earning at least $X. And I'd be looking to diversify my savings away from equities. For example: Real estate (REIT if you don't want to be a landlord); P2P lending, TIPs, something like the Vanguard GNMA fund (though just now may not be a good time to invest a large chunk in any sort of bonds), or a small business.

Also: Seriously consider a pre-nuptial agreement if you get married one day. :-)

You're very fortunate, but you're not squandering it. Don't know if I had that discipline @24.

Kurt has a good point, re: pre-nup.

Nothing to add, just compliments!

You are in great shape. Rather than focusing on being frugal, why not try to find a better paying job? $46,000 in annual income for someone with a graduate degree living in the Boston area seems quite low. I would think that'd be easier than being frugal. On the other hand, you have such a great start, so that's not necessary if you love what you do and have great working conditions. I echo the comment above about considering a pre-nup prior to getting married. If your investment income that your dad manages for you is not already in a trust, I suggest setting one up and keeping it separate in marriage. But from the sound of things, you are probably on top of that already! To be 24 again and in your position ....

I would like to congratulate you for having a good amount of assets and investments despite your young age. We all know that most young professionals of your age do not prioritize saving and preparing for retirement. Likewise, I can see that you are also enjoying life. Focus on your goals and you will be happier when you have turned them to reality.

You might consider using some of your parent gift money or other income to max out a ROTH IRA every year for $5000 or whatever the limit is. I assume your income is not too high to take advantage of that. Because you are young, the tax free compounding time of a Roth IRA should not be missed.

I enjoy the reader profiles, but it seems lately we've had a lot of people who are already money savvy. We need to hear from those who are having trouble getting their act together. Those are the ones who will benefit from our suggestions.

Carole --

Yes, all sorts of people need to submit them if we want this series to continue -- those who are doing well and those who aren't. Have you submitted yours? If so, what about an update?

BTW, Reader Profiles are meant to be just that -- a profile of where the reader is financially, good or bad. They are not meant to be only for those who need a massive amount of help/advice (we all need advice to some level). The "I need help now" posts would be more of a "Help a Reader" post.

Thanks for all the comments! I really appreciate getting feedback and different perspectives.

Kurt- Thanks for the car ideas. It has been a passing thought, but not one I have seriously considered. This is a good thing to look into. Also, appreciate the investing advice - investing is something I need to understand and familiarize myself more with.

And yeah, I don't go clubbing/drinking out too often (maybe to a bar/club twice every 6 months?). As a twenty-something this is the number one thing many people do to socialize and it's pretty difficult to find fun/creative alternatives. In DC it was VERY difficult for my boyfriend and I to keep our bar/club expenses down. Luckily, Cambridge has a lot of young people who are interested in great alternatives.

BH- I have to agree with you about the low salary. I work for a healthcare consulting and analytics firm and think my salary is somewhat low for having a Masters. However, my work/life balance is awesome and am hesitant in giving that up. I'm comfortable, but will more seriously consider and research other job options.

Also, great advice on protecting my assests in a trust. From what I understand, this is going to happen/happening.

Cherleen- Thank you! Appreciate the support, but I can't take full responsibility. Have to give most of the credit to my dad who is so generous and my boyfriend who exposed me to frugality and personal finance.

PennySaved- Agree with you totally. I am planning to max out my Roth IRA every year that I can.

If anyone has more thoughts on investing for someone my age, or any great books/videos/blogs to learn more about this that would be great!

FMF - bingo. At some point the profiles (or the commenters' interpreations at least) seemed to morph from a presentation of a financial situation to a plea for advice. I agree with Carole that it seems many of the profiles have been from people who don't seem to need much in the way of advice, but that likely reflects the readership at FMF. I like the profiles for what they are - insight into other people's financial lives.

Honestly one reason I have chosen not to submit a profile of my own (but not the only or main reason) is because I don't want people telling me I need an emergency fund or I should buy life insurance. I don't need an e-fund, and I know I should buy life insurance.

@ PennySaved

TW has only been in the workforce for about 8 months and she has already contributed to both 2012 and 2013 Roth IRA in this short period. In fact, I'm taking notes from her and suspect that she will be ready to invest another $5500 to her Roth IRA by January 1, 2014.

Awesome job so far! Like others have said the best way to increase your gap (spending/saving) would be to focus on your job since you've done just about everything on the frugal/spending side.

I see nothing wrong with taking on a job like this one you have for the first year or two. You stand to learn a lot about working under a boss and with coworkers for the time being (importance of team concepts, communication, detail orientation etc.) If I am not mistaken it appears like your parents are beyond financially independent. If so, look at what you do and see what you could possibly spin into a business for yourself. Your parents could be your very own venture capitalists!

I disagree with your idea of spending so little on your wedding. You'd have to invite a limited number of family and friends to keep the total wedding bill under 10 or 15k. You can afford a wedding that includes all the people you are close with to share in your special day. Having anything less that would not be frugal, IMO, it would be a miserly thing to do.

You are doing well! The best piece of advice that I can give you is to read a lot and gain as much financial knowledge as you can. Start talking to your dad about your investment account and maybe take over it eventually. Learn why he does what he does with it.

I agree with Luis about the wedding. Also chances are that her parents will probably pay for most of it, especially if she is an only child. I wouldn't save any money specifically for it at this point in time.

Regarding income, she's doing fine for her age. How many 24 year olds do you know making more than $46K? I don't think I have met one yet. My job right out of college was for $10-12/hour back in 2005, so maybe at this time the equivalent of $30K/year nowadays. I couldn't figure out from the profile what her industry is, but assuming it's halfway decent, she'll be making $80-100K/yearly by age 30.

I would be careful telling any prospective spouses what your total worth is. Guys can be just as gold-digging as women can be. Even if he can't access it, he knows it will be there for his and your retirement.

Carole, the "great financial shape" profiles are the ones where we as readers benefit the most. I actually prefer those because I can learn :)


As others have mentioned, you are doing a great job and are in a great situation. I would continue to do what you're doing, as you are already living well below your means. It doesn't seem like there are really too many areas that you need to cut out.

As Steve had mentioned, I would also suggest that you try to come up with a house down payment with your own income, and leave the gifted assets alone. That will ensure that you continue to stay within your means, and allow the invested funds to continue growing.

Great job. And good luck.


On the topic of Reader Profiles in general, I enjoy reading profiles of all sorts. It is interesting (and often enlightening) to read about the experiences of others, whether they may be making all the right decisions or if they need help.



Stay tuned....FMF will be submitting my bankruptcy story in a future blog post. Although the bankruptcy was more than 20 years ago, I hope my piece will provide insight into the emotional and psychological aspects of managing money that often aren't discussed.

For a health-care analyst with a master's in Boston, your salary seems a bit on the low side. I have a relative in a similar situation in a large city, and he's making more than $20K more, with only a bit more seniority. If you like where you are, I would work on getting a raise internally.

Good For you. I think you will be fine as you have a decent income and you have an employer who matches your contributions to your investments. Your parents are giving you money, hey, not many people I know get that you are lucky.If you really want to save money or find out where your money is going if you aren't budgeting and tracking your expenses that would be a great start. That's what we do and how we were able to save more money. We also started cooking more homemade meals rather than buying boxed items. We hardly ever eat out and our $8 a month budget for entertainment hardly ever gets used. We just like to eat in.If you find expenses you don't need, cut them out. I wish you all the luck in your journey!

@Luis @Noah

My wife and I spent slightly less than $10k on our wedding. We did not have to trim anyone dear to us from the guest list, and we enjoyed good food and live music without going over-the-top. While there are a few small things we wish we had done differently, none of them involve extra spending.

I think we would have been uncomfortable with a $20k or $30k wedding, even though we could have afforded it. We wanted simple food and an informal, comfortable venue. A glitzy bash would have been much less fun, and actually rather embarrassing, given that our friends and family are frugal and socially-conscious.

It's a matter of taste, of course, but please consider that more may not always be better. In any case, I hope TW will share her reasons for the $10k-15k target.

I agree with the sentiment of including all family and friends at the wedding. This is something that would take priority over cost. With that said, I believe if you are resourceful and creative there are ways to have a wedding without spending a crazy amount. For example, having a backyard wedding with a tent instead of getting married at a country club.

I personally known friends who have spent 15k on their wedding and were able to include everyone on their guest list.

15k in Boston would be a difficult task, but if I have my wedding where I grew up this budget is more reasonable.

All-in-all, I'm still sometimes in shock that people spend so much on their weddings. However, I might be in for a rude-awakening when it comes time to pick a venue, order food, and find entertainment. But I'm up for a challenge!

Again, thanks for all the insight and comments!

Regarding weddings, it all depends on how much you want to do yourself vs paying someone. For my wedding, I didn't want to be spending a lot of time for 3-6 months preparing and making things, nor did my fiance. My sister did a lot of her wedding prep herself and it was an enormous time investment. If you are going to splurge on anything for the wedding, make it the photography as that is something you can never re-do, whereas something like a DJ or good food can be done anytime after getting married.

A "country" wedding will obviously be less expensive than a wedding in more expensive areas. In my area, $20K will get you 130-150 guests at a modest venue, but it certainly would not be considered glamorous. For glamour, I'd say $50K would be the minimum, unless you only invite 70-100. If you have large families, that may not be possible.

@ 08graduate

Full disclosure...we spent 8k on our wedding in the south with 80 guests. It's the one thing I regret most because I cut out and hampered relationships in the process. Just didn't want others like TW to make the same mistake. If I could do it again I would certainly have done it differently.

Although our wedding was $30k, parents paid 1/2, so it's possible to have a really nice $15k wedding with some help. :)

Unfortunately that's not an option for everyone, but obviously it is for you, 1 parent's gift for 1 year.

We had a pretty inexpensive wedding in England in July 1956. For one thing we were going to be emigrating to Canada in the November and needed to have as much money as we could when we got off the boat in Montreal. As it was we landed with $400 between us. I did have a job waiting for me in Toronto that paid $83/week but other than that we were completely on our own with nobody else to turn to.

As for the wedding, my wife's father gave us 50 pounds, equivalent to about $80, that went on the wedding reception for 50 guests. My uncle who was a confectioner made the wedding cake and my aunt who was a dressmaker made the wedding dress. The church was an old Norman one built in the 12th. century when William the Conqueror ruled England for a while. Most of our friends & family didn't have cars so I rented a bus to take the guests from the church to the reception. I also rented a chauffeur driven Rolls Royce to take my bride and her father to the church, it was quite inexpensive as I remember. The photographer at the aircraft company where I worked as an engineer took our wedding pictures and the church was beautifully decorated with flowers for another event that was going to be held. We went straight from the reception to our honeymoon in my father's old Ford car and toured North Wales staying in B&Bs and farmhouses.

We will be celebrating our 57th wedding anniversary this July. Bottom Line - you don't need to spend $10,000 to start your marriage, there are better uses for the money.

As an addendum I would add that I am also very proud of the fact that we arrived in Canada in 1956 with $400, emigrated to the USA in 1958 where I obtained my MS in engineering, have raised three children, each doing well. We also lived very frugally in the beginning, invested very successfully and are now part of the top 1.5% of the population, having had great careers, travelled all over the world, and been happily retired since 1992.

@ Old Limey

If you had £74,000 in your investment account in 1956 wouldn't you have compensated your aunt and uncle duly for their time and their own personal money spent to help make your wedding day special? Would you have accepted monies from the families of either the bride or the groom to pay for a wedding you could more than afford on your own? My recommendation was always tied to the fact that TW could more than afford the expenses.

TW is smart and from her frugal nature knows how to let her nest egg grow and compound. If she invests it conservatively at just 3%, then in 57 years from now it will have amassed $27 million dollars. She is in a unique situation that (if she would allow herself) could forget frugality for just one day and decide to have a wonderful, memorable, and stress free wedding.

In the working class world of 1956, only 11 years after living through six years of the the bombing and deprivations of WWII, things were very different from the USA of today.

I was 21 and my wife was 22 at the time and if I had an investment account of £74,000 it would have been an unbelievable amount of money, but we were a very close knit family and my relatives would have been insulted if I had offered money for what they wanted to do in lieu of wedding gifts.

TW is certainly in a unique situation but our wedding was also wonderful, memorable, and stress free and as I have said it cost us very little. Our wedding was also typical of the social class and income level of the extended families that we were part of.

I suppose I am a 42 year old codger but all this wedding spending talk makes me sick, and it's indicative of a much deeper problem.

America has just come through the worst recession since the great depression such that it is called the great recession and yet what is going on? Weddings that cost 30K. High school graduations that cost 10K. Prom nights that cost 2K. Where do people get the money for this stuff? All we hear is how dire everything is but the spending on frivolous stuff sure doesn't look like it. And yes, it's all frivolous. A wedding certainly isn't frivolous but spending 30K to rent a fancy ball room or country club, feed them an elaborate meal, hire a DJ and pay to have an open bar is frivolous (I know NY and Boston, etc are different but these prices are happening all over the place). If your friends need you to throw that kind of a bash to honor you and celebrate your wedding, they would certainly not be the kinds of friends I would seek. Fancy high school graduation bashes and expensive $1000 prom dresses, all frivolous.

I have 11 tenants currently. Most of them at one point or another have complained about having a hard time paying the rent. Yet every one of them has nicer TVs than me. Every Single One! I have been in all their units and it's true. They all have BIG flat screen TVs. I still have a tube. They are buying motorcycles. They all have iPhones or droids. Why are they buying all these things if they can hardly pay rent?

Because America is spoiled. We are fat on our abundances and most of our abundances are borrowed from the future. We have little future time orientation. Consume now, pay whenever. That's how most people finance the frivolousness I am talking about. This is what funds this crap and it's a terrible kind of debt because what it bought has no lasting value. And it's the worst case of keep up with the Joneses. It's embarassing to not have a $1000 prom dress because all the people who are anybody have one. And your graduation has to be a bash because well, anybody who is anyone is doing that. And you can't have a small casual wedding because all your friends had a bash and how would that look if you didn't.

We are peer pressuring ourselves into debt over frivolous things that will not provide happiness or lasting enjoyment. It's just to enjoy the moment and live up to the expectations of others.

And it's an illness.

And stay off the lawn you darn kids!!! :)


You forgot to mention how much $ people then turn around after the wedding and spend on the honeymoon. I have known several people to spend upwards of $5-10K to travel to some exotic location.

I share the same frustrations as Apex and this may be why I am obsessively frugal (even if I can afford a nicer wedding). American's preferences for things and status over activities and the outdoors is something that is very irritating. I grew up surrounded by the 1 percent and you realize that the game of keeping up with the Joneses leads to jealousy, insincerity, and a continual dissatisfaction with life. Change your preferences and you'll be much happier.

We spent less than $1,000 on our wedding in 1978 and it was memorable, special and all those other lovely adjectives being used to describe weddings. Likely I think of that modest occasion so fondly because we're still happily married nearly 35 years later...which was the point of the whole thing anyway.

I have been to some wonderful (and expensive) weddings that I enjoyed attending and surely have given the happy couples some fairytale memories, and I have been to extremely modest weddings which were just as special for the celebration of the commitment being made. I don't believe there's a right answer to how much to spend for a wedding, the only important criteria being:

1)what you can AFFORD to spend (no debt, no using money that should be set aside for emergencies, etc)
2)what you WANT to spend

As long as you stick to the lesser amount of either item above I'd think you were being reasonable.

Like Apex, I have been amazed at the purchase choices people make, as though actual income or assets had no bearing at all. I know I'm getting pretty old but I think I remember a time when there was more correlation between income and lifestyle than it seems like there is now. Or maybe memory is not so reliable as I think.

TW-- you are lucky. And the nice part is it looks like you are humble and grateful too. I will simply echo the good comments from others- protect that nestegg-- be careful who you choose to marry- a prenup or some other fancy protection is probably prudent- and take the time to educate yourself in personal finance. There is so much good info out there, you will have no trouble. Your Dad is probably the best first step. I would be proud as hell if I were your dad and you showed me an interest in learning to manage your brokerage account. I am sure he will love to spend time with you and show you the ropes.

You are doing great. Just keep doing what you are doing.

@Apex- I couldn't agree more. The keep up with the jonses mentality has gone way overboard. I choose not to participate and that has done wonders for my net worth.

@ TW

You can be frugal but if you get obsessive it you could miss things that you'd have wanted later in life. For example, I wish I had hired a videographer for my wedding. I could have afforded it but I let strict frugality dictate my decision at the time. What my basic message to you is to say go and have everything you would find valuable for your wedding and do frugally select each service you hire but do not cap your total wedding expenses without knowing the true cost of all of those things.

My daughter had a wedding that we could have never afforded even if we had wanted to. She married a very wealthy and older attorney that flew in several hundred guests, at his expense, from the East coast and put them up at the best hotel in Silicon Valley for two nights since the wedding was a two day affair - wedding one day, pool party the second day. He also had the most famous wedding photographer in New York and entertainer friends of his, Peter, Paul, and Mary. The reception had the best two bands available and unimaginable quantities of food and drink for the 600 guests that attended

The wedding was never a good one but my daughter stayed with it until their youngest child died of a brain stem tumor at age 8. She was the glue holding the marriage together.

Fortunately she received a very large lump sum settlement and alimony for 8 years. After a while she went on and met a guy her own age that my wife and I really like. He's a manager at one of our prominent software companies and I suspect they will marry as soon as the alimony runs out.

@Apex...once again, you totally nailed it on the wedding thing. Thank God I'm gay and I never had to go through all that! Of course, now gays are a whole new market for the wedding profiters. Now that I'm 42, if same sex marriage becomes legal in my state, I'd just go to the court & sign the paperwork if we were so inclined.

@TW: You may want to review your asset allocation in the investment fund with your dad, particularly the goals you want to achieve (growth, income or principal preservation). He may be too conservative given he has it set up to provide you income.

If I was in your shoes I would identify future outlays (buying a car, down payment on a house, etc) and set up that amount of money more conservatively then go high risk/reward (with gains reinvested) for the remaining amount. Then focus on living off your wage with the exception of taking form the investment account to fund tax-sheltered retirement accounts and tax day.

Or y'all may have done that already.

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