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Student Loan Freedom!

Hi EnLifers! I’m SO excited to share that my student loan is PAID OFF!! No more student loan debt for us!! We originally paid off my husband’s student loan back in 2018, so here we are three years later and mine is finally a done deal! After 19 years, it feels good to be completely done. I know 19 years seems like a long time, but for some, it’s just the reality of circumstances.

For me, my student loan journey started in 1994 when I decided to attend a four year university 2-3 hours from home, but still out of state. I received an academic scholarship, however it covered tuition only, and little did I know (first college graduate in my family), there were other things like room and board, fees, etc that needed to be paid as well. The school roughly cost about $25,000 per year, however between my academic scholarship and federal financial aid, my cost per year in the form of a student loan would be $2000 – a total of $8,000 at the end of college (instead of $100,000). Seemingly manageable right? Well, life threw some curveballs and I made decisions that in hindsight, I’m not sure I would make if I had all of the information I have now.  The first was a round of summer school, which at the time, I thought was cost neutral because I had dropped a class and thought I had a credit to take it in summer. Not so. Lesson learned and it set me back about another $8000 if I remember correctly. The second, I probably would do again-it was for foreign study. However, it cost an additional $10,000 in tuition that was NOT covered by my scholarship and I took out a private loan to cover it which is probably what I would’ve changed if anything. THEN I decided to stay a 5th year which was NOT covered by my scholarship, so I racked up another $20,000 in student debt. I was able to save a little money by living off campus. So at the end of college, instead of owing $8000 in student loans, I owed roughly $46,000.

I took a gap year to work and figure out my career trajectory. I was working in healthcare and always wanted to open a clinic for the uninsured, so I decided to pursue a career in healthcare administration by first attending graduate school. Cha-ching! More debt. This time, I was able to get graduate assistantships that reduced my tuition a little, but by this time, I had real bills like rent, a car, and paying my grandmother’s health insurance. Oh and those first two student loans, but at least the federal one was deferred while I was in school. The private one demanded I pay them, so I had that bill too. To help afford living expenses in addition to tuition, I took out an additional $ $25,000 in loans for graduate school.

If you’re counting with me, that’s about $71,000 of student loans. My first professional job – $39,000. Which to me was great! But not so great, when the student loan bill came in for $600/month! That was only slightly less than what I was paying in rent. As a result, I forbore my loans based on low income. After a couple years, my income increased some, however I still couldn’t afford the payments. To make the payments more manageable, I consolidated the loans (undergrad and grad) into one loan and put it on a 25 year graduated payment plan. Unfortunately, the private student loan company started applying variable interest rates to my loan making the payments unpredictable (maybe I’ll write on that lesson later), so I used one of my credit cards with a 0% balance transfer to absorb that loan and stop the volatile money hemorrhage. So in reality, I started paying my loans on a consistent basis in 2004 and the amount due increased over the years as my income increased.

In 2018, I’d paid the loan down to about $25,000 and my employer approved a performance and retention based student loan repayment for the balance in exchange for a service agreement that I’d stay in the position for three years. My employer made the payments directly, so I was able to delete the payments from my monthly spend plan and increase cash flow in other areas for three years. The three years ended in early 2021 and due to interest and taxes, I still owed about $1700 which I gladly paid in one lump sum. And now, I’m done!

I hope my student loan journey resonates with you or someone you know.  Please know that it is possible to get it paid off even amidst non-ideal circumstances and there are options available to help-that’s another post.  Have any of you paid off your student loan? How did you do it? EnLifers want to know!

Until Next Time….

MK

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EnLife Intentions 2021

It’s been a while! Been living that pandemic life!! 2020 was a wild ride! I became a bit busy (read too busy for my blog) as I had the opportunity to work on Capitol Hill for a year and as you can imagine, things got really real with a pandemic, calls for racial equality, and an election. Things are settling down a bit and I’ve really begun to think about how I can shape EnLife into help for all of you, not just with your personal finances (it’s one of my favorite things to talk about), but for your ENTIRE life! That’s actually how EnLife was born, it was to help people with money that eventually leads to enhancement and enjoyment of their lives. However, that was 11 years ago and so much has happened since then, that I’d be remiss to ignore how it’s all connected. So, let me just throw this intention out there. My plan, and I can use your help, is to really propel EnLife in 2021 to share my life experiences in an effort to help others and to establish a network where we can all help each other. I will start posting in some of the social media spaces – most likely Facebook and YouTube and if you have any other platforms you’d like to us to go, please let me know via comments. Please share with others that you think will enjoy the content and as always EnLife until next time!  

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“EnLife”ing COVID19

Hi EnLifers!

So lots has been going on since I last wrote! I’ve endured another 6 weeks of COVID19 pandemic restrictions with no real end in sight! This has included working from home, managing my youngest child’s learning, continuing my weight loss journey and all while trying to maintain healthy relationships with my nuclear family, extended family and friends! Oh and I celebrated a birthday and my hubby’s 40th!  Over the next few posts, I’ll explore all of these things in more depth and share some of the strategies I’ve used to stay sane and “enlife” the situation! In the meantime, here are the cliff notes!

1) Working from Home – I’m not a stranger to working at home since I began working from home when my first child was born and that was 8 years ago! However, I recently snagged an amazing opportunity that required me to work in an office beginning January 2020. It helped me realize that there are always pros and cons to any situation – for instance, I noticed that I’m able to keep boundaries better working in the office. Outside of the office, I feel pressure to always be available which isn’t sustainable – at least not for me. So, though I can’t say that I’ve completely enlifed the situation…yet, I’m working on it and my strategy is just to simply respect boundaries-start and end on time. Period.

2) Managing Children’s Learning while Teleworking– I have two children-5 and 8 and they have been distance learning since March 16. A few ways we have enlifed the situation to reduce stress are 1) we decided to each be solely responsible for one child so that we didn’t have to keep up with two different approaches since they were at two different schools. I took the 5 year old who is in a Montessori Pre-K. So yeah-that’s been interesting, and I’ll go into more details maybe in my next post when it’s all behind me! School ends May 29! Woo-hoo! 2) I came up with a schedule – a flexible one that worked around the set times that the school had, but gave both my son and I breathing room when something urgent came up at work or my son simply wasn’t having it! 3) I had compassion for myself and my son when days didn’t go as I wanted or expected.

3) Weight Loss Journey –I’ll definitely have a lot to share with you on this in some later posts. It requires some background context, but basically I’ve been on a weight loss and body repair journey since June 2015, but really amped it up when I decided to start training for a body building competition one year after my son was born and competed in said competition in November 2016. Since that time, I’ve always thought I’d get back to competing but have not and in the meantime, gained back 57% (at my heaviest) of weight I lost. However, in January, I recommitted mostly due to said job that required I go back into the office. I was steadily losing a pound a week and then COVID19 hit and totally disrupted my groove – which also included walking to work each day! But I refuse to gain the COVID15, so I’ve still been working at it and still losing about a pound a week – except these last two weeks of birthday gluttony! Enlife hacks you ask?! Expend more calories than I take in. I’ll share with you later what all that entails.

I think the biggest, greatest blessing COVID19 has unveiled is connecting virtually with friends which I’d mostly have to do anyway as I live now live far from most of them now. We occasionally text, but we hardly ever took out time to do video chats which personally lift my spirit a whole lot more! It’s been so nice to see their faces, hear their stories, and just be there for each other encouraging, relating, and inspiring one another. I hope that part continues after COVID19 is a distant memory!

Well, that’s what I’ve been up to in these COVID19 times for the most part. You know money stuff is always in the background too, so I’ve got some new developments in that department as well that I can’t wait to share later with you.  What about you?! Please share what you’ve been up to lately and any topics you’d like me to cover in my future posts! Thanks!

MK

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COVID19 EnLife Tips

Hello EnLifers!

Happy Easter to those of you that celebrate!  It’s been three weeks since I posted last and man what a change a few weeks can make! Everyone is under some kind of house arrest basically trying to stay COVID19 free and/or not infect others! And it’s wreaking havoc on our economics as a nation and personally! I’m very grateful that my husband and I are both still able to work and I feel for those that are unable to support themselves and their families. So this post is dedicated to ideas to help us all stay sane (or shall I say EnLife!) and help one another based on my life experiences these past few weeks!

  1. Schedule time to video with your loved ones! I’ve had three 1+hour video chats just this week! Seeing people has been key to boosting my mood and feelings of connectedness!
  2. If you’re looking for ways to help others, here are a few I’ve run across or have heard from others I’ve talked to –
    • If you pay for personal services that local small businesses or solopreneurs regularly provide like haircuts/ maintenance, house cleaning, or food-you can continue to pay those providers even if you aren’t receiving those services-to help them weather this storm. One of my friends did this and it inspired me to do the same!
    • Buy gift cards from local businesses. It helps to provide them some revenue to continue paying operating costs such as employees or leases.
    • Work with your local school to either donate food gift cards or food to local school or community banks to help those families that normally rely on school meals or for those that have lost jobs and are struggling to make ends meet.
  3. Use the time to slow down or complete projects you normally don’t have time for. I actually started working on my taxes though I know we have the extension until July 15-that way I won’t wait until the last minute (AGAIN) to do them. This gives me plenty of time to stretch out the work and not stress about it so much!

If you have any ideas, please share them in the comments section below! We’re all in this together!

MK

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ROTHS Amid Coronavirus!

Hi EnLifers!

So man, Coronavirus huh?! Crazy, we’re all social distancing, teleworking and the such. Seriously though, I feel so much for those of you out there who aren’t working due to this virus, without the ability to telework and no childcare, and for those with kids that are teleworking and homeschooling (and God forbid, you have multiples!) – I actually fall into the latter category. This whole thing is bananas!

However, I realize that generally bad situations usually have at least one good side effect or way to turn that frown upside down! So my silver lining?! STOCKS ARE ON SALE! I have had the intention of getting a ROTH IRA for THE longest time, but never executed mostly because of analysis paralysis. I wasn’t exactly sure what I needed to open a ROTH and what funds to choose and I let perfection be the enemy of good enough (more on that in another post), and now I’m almost at the point where we can’t contribute due to income limits. So due to FOMO (fear of missing out!) I finally, in early March, I took the plunge and set up 2019 ROTHS since it’s probably the last year we’ll be able to contribute. Luckily, the IRS allows you to open and contribute to ROTHS from the previous year before tax day which looks like that’s extended this year too – woohoo (gotta still do my taxes though)! Anyhow, I digress.

First, I decided to open with TD Ameritrade because I already had an account with them back from Suze Orman days when she matched or gave $50 or something for everyone that opened an account and contributed consistently. (I might be telling my age 😉) In hindsight, I would’ve gone with Vanguard because they have more of the funds I wanted. So Lesson 1 – make sure your brokerage has the funds you want. I opened the accounts (Please note you have to have individual accounts so did one for both hubby and I) and I funded from savings and our 2019 tax refund that I’d saved.

Secondly, I needed to decide what fund to buy. However, again because my analysis paralysis was starting to rear its ugly head, I didn’t invest right away. But geez! I’m SOO glad I didn’t because the stock market went haywire! I went STRAIGHT to Amazon to see if it’d fallen too! Side note: I’ve been stalking it for a while and regretting not purchasing a few years ago when it’d reached ~900$/share and I’ve been waiting for it to get back there, but it probably won’t. However it did fall to ~$1600/share this past week and I was like – yeah baby! It’s on sale and I’m buying! It’s been like $2000+ a share for a while, so I consider that win!  Now, outside of that happening though, my plan was to invest in index funds as most of the advice I read and heard on my podcasts were about index funds.  I’d saved some tabs from posts that I’d heard on Optimal Finance Daily  like this post from the Finance Twins and Dollar Sanity, which I found just through a web search. I cross referenced recommended funds and voila! I had the funds, but then the problem was that they didn’t have those funds at TD Ameritrade which is how I got Lesson 1. Anyhow, all was not lost, I found one Vanguard fund that I was interested in (VTI) which is the Vanguard Total Index fund and it seemed to be doing ok even amongst all of the stock market dipping, so I went with that. However, Lesson 2 is that if your brokerage firm doesn’t have the exact funds you are looking for, do a search and try to find like funds by searching for things like no cost etc.

The last thing is that I ended up not investing all of the funds due to the volatility of the stock market right now. I wasn’t sure if the market would fall again and I didn’t want to be all in if it did, so I’m taking it week by week, but I do plan to allocate all of the funds within a month or so. I’m glad I used this approach as even with purchases on sale, they fell again and I lost about $90, but I’ll take it. If history is the lesson, then we know nothing last forever and this bear market is no exception, so I say buy up and wait the long game. I’m pretty excited about what the future holds. And I did I mention I can also withdraw my contributions at any time, penalty free and not pay taxes or penalties on any investment earning withdrawals after age 59.5?! Exciting times and I’m glad I took the plunge even if it was in the middle of Coronavirus! Living my EnLife!  

Stay Healthy!

MK

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Happy Leap Day 2020!

Hi EnLifers! I’m back! I decided February 29, 2020 would be a great day to take a LEAP back into blogging and EnLife in general! I’ve been pretty busy since I last posted back in September 2018! I relocated my family to another state and started a new venture in my day work! I love personal finance, but I also love all things Life-talking about things that we experience in hopes that it will help someone else! And a lot of times, these things can still relate to personal finance in some way. So my plan is to increase my viewership and listenership with multiple platforms. I am going to start a Facebook Group and a YouTube Channel to just share what’s going on and keep this going. Today’s post will just be an update of all of the various personal finance & general life topics that I’ve encountered since I was here last and I’ll plan to go more in depth in later posts. You can look forward to the following posts regarding:

  • Interstate moves
  • Mental Health
  • Couples Finance
  • Financial Advisors
  • ROTHs
  • Taxes
  • Financial Literacy & Resources

My plan is to post 1-2 times a month and also link you to other resources in the EnLife portfolio. If you have any other suggestions about topics you’d like me to explore, please leave a comment. Also please subscribe to receive notifications of new posts!

Thanks for joining me on this life and financial journey!

MK

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Did you know? Actual Cost Value vs Replacement Cost

Hi EnLifers!! I’m back!!! Man-it was a busy summer and we’re just getting into a groove with school starting! So in all of the busy-ness of life, I stumbled upon something I was unaware of regarding my homeowner’s insurance. A storm hit our area in March of this year and one of our neighbors had some major roof damage also resulting in some major interior damage.  She was telling me about all of the problems she had with insurance covering the losses because she had a policy that provided “Actual Cost Value” coverage and she had no idea. So then upon researching it, I found out why that would be a major issue. So, Actual Cost Value (ACV) means that the insurer will pay for losses LESS the depreciation for the age of the roof and home interior in addition to the normal deductible.  What this meant is that if the roof and interior were depreciated, let’s say down to $5000, then the insurance will only pay that minus the deductible. However, if in reality it costs $15,000 to fix your roof and/or home interior, then you’re out $10,000.

Of course, I looked up my coverage immediately mainly because 1) I wanted to see what we had and make sure we were adequately covered and 2) since there seemed to be a lot of damage in the neighborhood, we wanted to get it checked out to make sure we didn’t have damage that we couldn’t see.  Fortunately, I had something called “Replacement Cost Value” on my home and roof.  What this means is that the insurance company will cover the real total amount of what it costs to replace and/or repair the roof and/or home interior minus the deductible of course. So, I breathed a sigh of relief UNTIL a month ago! When my insurance renewed, they automatically switched our roof coverage to ACV due to the age of the roof (everything else is still replacement value). When I noticed, I called to find out if I could have to have it switched back and was told I could not; however I could switch to another insurance company that would which is what I plan to do. In the meantime, hopefully our roof is ok. I’m nervous to get anyone to check it out as I’ve heard about scammers who inspect the roof, but actually create damage while up there. Before I go through any of that, I’d rather get the roof insured entirely. So, hopefully this helps you educate and prepare yourself before sustaining an actual loss. As always, please share with anyone you think would find this information useful and please share your stories if you’ve been affected by this or have any tips to share!

Happy Fall!!

MK

 

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Just a check-in Post!!

Hi EnLifers! It’s been a couple of months since I checked in! Lots has been going on with the school year ending and lots of road trips! I wanted to check in and for accountability and let you know I executed the 529 from the last post!!  YAY!! The kids now have 529 plans and though we’re not contributing right now, at least we’ve gotten started and will still have the benefit of compound interest/gains! So the other thing is the emergency savings and what do to with that. I am concerned about the liquidity of it if we should need it. So stay tuned on that. Honestly, we’re traveling so much this summer, I haven’t been able to focus as much on our finances. Hope to check in toward the end of the summer to regroup. In the meantime, please enjoy your summer EnLifers!

 

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Getting it done! 529s

Hi EnLifers!! Sooo, I was thinking about what I wanted to write today and basically what’s on my mind is all of the things I haven’t done yet this year. So, my plan is to write it here as a reminder and for accountability so that I’ll make it more of priority. Two goals that I haven’t executed yet are to set up 529s for the boys and to switch our emergency savings to either a high yield savings, CD, or mix of both.  So what’s holding me up? Life in general, but also some contemplation that I’ll share here in case you’re pondering the same thing. The main thing I’ve been pondering re: the boy’s 529 is if I should take the savings that are in their accounts and start the 529 or start from scratch. A few things were considered before making a decision – 1. We are not in a position or ready to contribute on a regular basis. Right now, it’d be more of when we receive windfalls etc until we have additional, steady income. 2. I want them to have some $ in savings when they reach maybe 16 or 18 or something to use it for whatever they want-car, college spending $, etc. It won’t be a whole lot, but basically be comprised of their piggy bank $ and cash gifts over the years. 3. Which 529 is the best? Right now, we live in Georgia, but apparently, you don’t have to open a 529 where you live which opens so many more opportunities. There are TONS of 529s and I found it a bit overwhelming at 1st, but there are some sites I trust-mainly the government sites. The best place to start a review of 529 plans if you’re interested is the US Securities and Exchange Commission (SEC). They have an intro to 529 plans that can be found here and they have also set up the College Savings Plan Network, where you can find out more about 529s and even compare plans. I also searched the internet for free independent reviews of 529 plans.  Ultimately, I decided to go with the Georgia plan as I found it was rated fairly well and they also give tax benefits to GA residents. In talking things over with my husband, we also decided to take any money that we’d saved directly in the kid’s savings accounts and put in the 529 plan and leave gifts in the savings accounts which I thought was a good compromise. Now, I just have to execute. I’ll give myself until the end of the month to execute and check back in with you all to let you know what happened! Do you have any experiences and/or opinions to share re: 529s? If so, please share below in the comments!

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What is a ROTH IRA and does it make sense?

Hi EnLifers! So, we paid off the student loan!! Woo-hoo! Now on to other things. At this point, the only debt we have right now is one more student loan which is currently being paid by our employer and our house. So now our attention has turned to what to do next. One of the things we’ve discussed and I’ve heard a lot about via podcasts over the years are ROTH IRAs. What is a ROTH IRA? First, IRA is short for Individual Retirement Account, so basically it is a way/tool to save for retirement instead of or in addition to whatever plans your employer may have with some income restrictions (see this link at irs.gov for additional details).  IRAs are generally tax-advantaged in that you can deduct your contributions to the IRA on your income tax return and the IRS does not consider it income. However, when you withdraw money in retirement, you will pay taxes on those withdrawals. Now, the difference in a regular IRA and a ROTH IRA is that you pay taxes on your contributions in the present. That way, when you retire you can withdraw your money (including the growth) tax-free. There are some income restrictions with ROTHs too, basically you can’t make over a certain amount in order to take advantage of it.

So for the longest time, I’d heard that ROTHs were the way to go and now circumstances actually allow for me to contribute. The thing is, I’m not sure if it’s the best deal. Hear me out. So, I actually changed to the ROTH option at my job for a couple of years once our income situation changed. I was doing a 10% split, so 5% in the regular account to get the match and 5% in the ROTH option. This option significantly reduced my take-home pay, but ROTHs are very much encouraged by most personal finance experts and I really like the idea of not paying taxes later. However, this year, I’ve been thinking if that’s the best thing for me and my family. Right now, with young kids and lower income, we could use all of the help we can get AND I’m not so sure our income in retirement years will be more than what it is now. So for instance, if we are in a 28% tax bracket now, there’s a chance it will be lower in the future because we just earn less and are in a lower bracket or the government may actually reduce it which ACTUALLY just happened. The only thing is, plain ‘ole economics tells us that tax breaks just aren’t sustainable in the long term, so they WILL increase at some point. The question is will we be a part of the group that pays more. These are all things to consider and probably a lot more depending on your situation as there are so many nuances with both plans that I haven’t delved into.

Ultimately, I’ve decided to go back to the traditional retirement route where we contribute essentially tax free for now AND I decided to contribute the max in 2018, which actually puts me at a 14.5% savings rate which is better than the 10% I was doing with both the ROTH and traditional option. Even with increasing the savings rate, I’m still able to bring home more take home pay which helps our young family right now as we navigate pre-school and extra-curricular expenses. However, I do take some solace in having contributed to a ROTH for a couple of years which ultimately just helps to diversify our portfolio in case we need funds earlier than we can pull from our traditional accounts AND if it just so happens we’re balling out in our retirement age! LOL

What are your thoughts? What would you do?  Please share your thoughts below!