Debt Free!

Milestone attained. I’m debt free!

No longer have I the big scary education loan or distasteful car note. Nope. All paid off as of January 2015, and on schedule too!

Instead I’ve recently taken out a $2,500 ‘loan’ from Capital One. Not wanting to miss out on contributing to my Traditional IRA for tax year 2014, I took my VentureOne credit card over to Target and loaded funds onto a Target REDcard. Once loaded, the funds were withdrawn to supplement my linked bank account. From there it was simple to transfer the full $5,500 to my Vanguard retirement account. That account holds just 1 fund, VTSMX Investor Shares with a lowly 0.17% expense ratio.

Now that we’ve passed the 15th of April threshold, I’ll mark the entrance into tax year 2015 by once again contributing $5,500 to that same account, bringing the total invested to over $10,000. Once that special $10k level is exceeded, the holy grail of Index Investing becomes available:  VTSAX Admiral Shares. The expense ratio on that fund drop to only 0.05%. I am pretty excited about this!

It is worth mentioning that the ‘loan’ from Capital One is completely interest-free. As long as the minimum monthly payment of $25 is met, there are no interest charges and no late fees are assessed until January 2016. It will be easy to repay $2,500 over the next 8 months, and essentially I’m contributing a much higher value to my future worth. Hooray for investing in the future!

With the insane car note repayment cost well in the past, I now have an extra $1,600 or so to play with. As mentioned in Debt Destruction 2.0, those funds were marked. The plan was to direct them straight into an investment account holding exactly 1 fund, Vanguard’s VTSAX. This, however, is not to be. It has been decided that the money will never hit my bank account. No, instead my 401(k) contribution percentage has been bumped WAY up. I’m now on track to contribute almost the full $18,000 allowed for tax year 2015. Again, it’s time to accelerate saving for the future.

Unfortunately I am also losing my position at work. It’s being moved out of New York City, far, far out of state, away to a place where I will not follow. My surroundings have become familiar, my friends I would not want to move away from. I am young, and it is enjoyable living where I do, so much excitement and culture just a quick trip to the city away. Over the next 5 months my expenses are very well covered. In fact overly so. Truly I have no deep apprehension about finding another job.

To be honest it’s a good thing, too. Ballpark average of time spent in my type of position at work is about 2 to 3 years. By May 20th I’ll have just passed the 2 year mark, and my patience with the duties has been running thinner every day. Repetitive busy-work, frequent turnover and retraining, endless levels of bureaucracy. It’s high time for a change. Flip side, however, is that it is also convenient just to come in every day, sit down, and know exactly how much or how little I need to do to make my boss happy. I understand how my colleagues work, their strengths, and how to bring about good results.

But it also brings up a really awesome opportunity. As mentioned, over the past couple of years I have become familiar with my surroundings. It is easy to see the places where it actually makes sense to work. The areas I can reach quickly by train are up-and-coming with plenty of job growth in the sector I have been working in. Then again, do I really want to go back into financial services? It’s steady work, if not groundbreaking stuff. Honestly I enjoy a job that steps aside at the end of every week and allows me uninterrupted focus on the weekend. None of this high-tech operations on-call bullshit. No start-up late night, overtime, coffee stop  ‘lifestyle’ for me. Instead—and, sadly, this is a big presumption—I think I prefer a Big Industry 9 to 5 desk job for the straightforward predictability that big bureaucracy brings. Huh, who’ve thought. Maybe I should step outside my comfort zone. Is this the opportunity to do just that?

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