Short on income/prospects, long on time: How to maximize?

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countofmc
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Joined: Tue Dec 11, 2012 11:03 am

Short on income/prospects, long on time: How to maximize?

Post by countofmc »

My wife and I are currently doing okay financially, I think. We are both gainfully employed and manage to put away about 1/3 of our post-tax income every month. But our budget is cut to the bone, and we have no kids and rent. If we are to meet some of our goals, such as purchasing a home and MAYBE having kids, our incomes do need to go up and outpace inflation.

I have mixed opinions on my current job. I work a fairly flexible and relaxed schedule (never more than 40 hrs/ week, some days I can telecommute), my co-workers are nice, and the benefits are solid. However, the salary is fairly low, the work is pretty routine/boring, and the skills are very static and not something I can transfer to any other job. I'm pretty important to my current organization, but a similar position probably does not exist anywhere else, if that makes sense. Because of this even a lateral move to another position within my organization is not possible, and upwards mobility is limited because I don't have many superiors and they are "lifers".

I've been doing some job searching, networking, etc to find a good situation I'd be willing to move to. But at the same time I also want to maximize my current most plentiful asset - time. I thought I'd ask for general opinions on what everyone feels would be a good use of my time in terms of improving my career prospects. I was thinking of trying to make some side income, but I do have to work regular business hours, so a regular part time job isn't really in the cards. I mean maybe I could wait tables or something...
Grt2bOutdoors
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Re: Short on income/prospects, long on time: How to maximize

Post by Grt2bOutdoors »

If you are able to save 1/3 of your after-tax income, why do you believe you will not be able to purchase a home in the future?
"One should invest based on their need, ability and willingness to take risk - Larry Swedroe" Asking Portfolio Questions
Topic Author
countofmc
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Joined: Tue Dec 11, 2012 11:03 am

Re: Short on income/prospects, long on time: How to maximize

Post by countofmc »

Because we are prioritizing retirement savings, so the majority of that money goes into tax-deferred accounts like Roth IRA and 401k. We do no saving (besides E-fund)outside of retirement accounts.

Even if we were to switch to saving for a home, it would take years because we live in the Bay Area.
Topic Author
countofmc
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Joined: Tue Dec 11, 2012 11:03 am

Re: Short on income/prospects, long on time: How to maximize

Post by countofmc »

I should have clarified, although not sure if it really matters. We don't really save an after-tax income right now, because we save all we can in our 401ks. But if we were to stop 401k contributions (outside of company match) we'd be able to save about 1/3 of our AFTER-tax income.
Acesalad
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Re: Short on income/prospects, long on time: How to maximize

Post by Acesalad »

Since you say you have a lot of time why are you saving so much for your retirement, 1/3 or 33% of your salary? Is your goal to retire at 50? What if you saved 15% toward retirement and saved the other 18% for a downpayment on a house. Saving 15%, especially if you are starting in your 20's, should provide a very comfotable retirement. Plus you only have to save for the down payment for 3-5 years (guessing). Then that 18% is availabe to go back to retirement, towards the increase cost of owning a house compared to renting, raising kids, whatever you choose. If at worst you continue to save 15% for retirement over your lifetime you are going to be fine. I have a feeling if you follow my advice you will eventaully go back to contributing more than 15%. You seem very motivated to improve your income and save.
Topic Author
countofmc
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Re: Short on income/prospects, long on time: How to maximize

Post by countofmc »

Acesalad wrote:Since you say you have a lot of time why are you saving so much for your retirement, 1/3 or 33% of your salary? Is your goal to retire at 50? What if you saved 15% toward retirement and saved the other 18% for a downpayment on a house. Saving 15%, especially if you are starting in your 20's, should provide a very comfotable retirement. Plus you only have to save for the down payment for 3-5 years (guessing). Then that 18% is availabe to go back to retirement, towards the increase cost of owning a house compared to renting, raising kids, whatever you choose. If at worst you continue to save 15% for retirement over your lifetime you are going to be fine. I have a feeling if you follow my advice you will eventaully go back to contributing more than 15%. You seem very motivated to improve your income and save.
Thanks Acesalad. Splitting savings between retirement and house down payment is something I've been considering for a while, I might start doing that in 2014. Maybe do the 15% in 401k, and save the rest in ROTH IRA so I can use for home down payment if that happens, or otherwise I'll have it as retirement savings.
Topic Author
countofmc
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Re: Short on income/prospects, long on time: How to maximize

Post by countofmc »

I'll give this one final bump, and then retire it.
tibbitts
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Re: Short on income/prospects, long on time: How to maximize

Post by tibbitts »

Only you can know if you really believe you have the talent/ability/desire to do better than what you're doing now. You might find it difficult to find a job that would both pay more and not demand more in terms of time/flexibility, and that's not a tradeoff everybody would take. Lots jobs have routine/boring aspects. A lot of people would probably be very happy to have your job.

Upward mobility being limited is partly a generational phenomena: there are simply fewer levels in many organizations today, so it's a lot more difficult for the average employee to move up.

If you have an interest that could produce some part-time income, my guess is that you'd be better off directing your efforts there. But it seems that you don't seem to have something you really want to do, either full or part-time, so that makes it difficult to recommend anything other than staying at the job you have now.
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