Not seeking advice as just writing my 'story'. I have some major changes that will be coming in the next year that I see as a challenge and an opportunity to get simpler and have a less stressful life. In the meantime my next year will likely be one of the most stressful ever.
I spent 9 years in a relationship that ended in 2010. upon splitting up, we divided our cash and debt evenly. I ended up with about $20k cash and $20k debt (credit cards).
In the next few years I had my mid-life post-break-up crisis and pretty much didn't pay off any of that debt. Had a good job and spent just about everything on travel (mostly). Because I left just about everything behind after the breakup, I didn't spend much on "stuff" and remained fairly simple from a material-possessions standpoint. I had a small room in San Francisco in an apartment with a roommate.
In 2012-2013 I had some major health crises (nothing debilitating but just very sudden and unusual for a person with no history of health problems). This made me even more "in the moment" and I was on the verge of bailing on my job and just scampering off on a trip around Europe or something to blow the (now) $30k in cash savings I had.
Luckily I suddenly fell in love with a little community in the North Bay Area and decided to quickly turn that money into a down payment on a house rather than a months-long party.
But having a house on my own was a real financial challenge. A year later I was back to having about $20k in cash saved back up (what I consider a minimum "rainy day" fund) but my CC debt had ballooned to $35k from furnishing the house, repairs, and having to put living expenses on CCs so I could use my cash for a contractor to fix up a guest cottage on the property.
In the past year I've kept my 401k and IRA contributions at their max, and saved a little in a TreasuryDirect account. So my balance sheet looks something like:
- CC Debt $35k (Balance Xfer arbitraged at 0% for the next 6-12 months)
- Cash $30k
- 401k/IRA/TreasuryDirect $30k
- Mortgage balance $250k (Monthly pmt $1800 @~4.5%)
I have eliminated my travel and "adventure" spending completely since buying the house. All my free cash flow has gone into it instead. I'm at a point now where that's also done and I can pour all my income into saving and paying off debt.
EXCEPT: I found out recently that my primary job will be going away in the next 6-9 months. I've spent the summer experimenting with new job ideas and found that rather than staying in the rat race at my current income level, I'd rather move to a new career in hospitality which will cut my income by about 75%-80%. So: I pretty much have to plan on not building much more savings, and just paying off debt so that my living expenses are lower when the income dries up.
Am I crazy for making that sort of plan for the adjustment or should I buck up and aim for continuing the rat race so I can save more? Thoughts? Ask any questions if you want clarification on any items. Appreciate the input!
I spent 9 years in a relationship that ended in 2010. upon splitting up, we divided our cash and debt evenly. I ended up with about $20k cash and $20k debt (credit cards).
In the next few years I had my mid-life post-break-up crisis and pretty much didn't pay off any of that debt. Had a good job and spent just about everything on travel (mostly). Because I left just about everything behind after the breakup, I didn't spend much on "stuff" and remained fairly simple from a material-possessions standpoint. I had a small room in San Francisco in an apartment with a roommate.
In 2012-2013 I had some major health crises (nothing debilitating but just very sudden and unusual for a person with no history of health problems). This made me even more "in the moment" and I was on the verge of bailing on my job and just scampering off on a trip around Europe or something to blow the (now) $30k in cash savings I had.
Luckily I suddenly fell in love with a little community in the North Bay Area and decided to quickly turn that money into a down payment on a house rather than a months-long party.
But having a house on my own was a real financial challenge. A year later I was back to having about $20k in cash saved back up (what I consider a minimum "rainy day" fund) but my CC debt had ballooned to $35k from furnishing the house, repairs, and having to put living expenses on CCs so I could use my cash for a contractor to fix up a guest cottage on the property.
In the past year I've kept my 401k and IRA contributions at their max, and saved a little in a TreasuryDirect account. So my balance sheet looks something like:
- CC Debt $35k (Balance Xfer arbitraged at 0% for the next 6-12 months)
- Cash $30k
- 401k/IRA/TreasuryDirect $30k
- Mortgage balance $250k (Monthly pmt $1800 @~4.5%)
I have eliminated my travel and "adventure" spending completely since buying the house. All my free cash flow has gone into it instead. I'm at a point now where that's also done and I can pour all my income into saving and paying off debt.
EXCEPT: I found out recently that my primary job will be going away in the next 6-9 months. I've spent the summer experimenting with new job ideas and found that rather than staying in the rat race at my current income level, I'd rather move to a new career in hospitality which will cut my income by about 75%-80%. So: I pretty much have to plan on not building much more savings, and just paying off debt so that my living expenses are lower when the income dries up.
Am I crazy for making that sort of plan for the adjustment or should I buck up and aim for continuing the rat race so I can save more? Thoughts? Ask any questions if you want clarification on any items. Appreciate the input!
Long Story and Some Numbers
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