Floor 36: Hit the Pause Button

You may have been waiting for a February loan repayment update.  There will probably be no update worth seeing for a little while, and that’s because Mr. DebtFreeJD and I have a sudden need to stockpile cash for another project for the next few months.

That project is a house.

The sudden need?

I will give you a hint.  For the last while, I have been wearing pants with an elastic band in them to work.  Also, I have become very interested in food.  See here. And here.  And here.

Need more?

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Dog DebtFreeJD is making sure she’s prepared.

 

I realize it is not technically necessary to have a house in order to deliver a baby, but several factors are pushing us in that direction, including:

  • We live under three graduate students, who occasionally have loud parties.
  • We live over three medical residents, who (I assume) have strong feelings about getting enough sleep.
  • Unclear whether moving near the end of pregnancy is better than moving with an infant, but we are hoping that it’s easier when baby is inside me rather than outside.  Also, in the former scenario, I don’t plan to lift so much as a pinkie to help move us, so obviously there are benefits to me.  And Mr. DebtFreeJD is a trooper.*
  • Our landlord just raised our rent by $200/month.  Again.

It’s really that last one that’s the kicker.  Kicking us right out the door.

Despite our best efforts, we so far have been spectacularly unsuccessful in home buying.  Failures include entering into a contract to buy a house that fell apart over the inspection results, and being outbid on another house that sold within 72 hours of being put on the market.  Optimism, however, blooms eternal around here, and we are hoping that we can purchase, close, and move into a house before Baby DebtFreeJD arrives in about four months.  To do that, however, we’ll need the money that we were previously throwing at law school loans, especially since we are not buying a fixer-upper while I can’t bend over to tie my shoe laces without some gymnastics.

Therefore, Project DebtFreeJD is on hold until Project Buy A House to Put A Baby In is complete.  Don’t worry, posting will continue, although it may take a slightly different direction for a bit, like how to save money on maternity clothes? (hint: buy as few as you can); signs of a bad real estate agent (we are now very experienced); and is it bad parenting if you resist buying anything for forthcoming baby until the last possible moment (hope not!).

*Before you feel too sorry for him, we will hire movers.  Plus, even though we say I’m not going to so much as open a box, we also know that’s not true.  Who else will alphabetize my books?

Floor 35: Smoothies For Breakfast

Confession: I am not really into oatmeal for breakfast.  I like oatmeal.  For health and financial reasons, it would be nice to like eating it every day for breakfast.  But I don’t.  I think it’s the texture – I have mushiness issues.  I’m happy to have a bowl or two of oatmeal a week, but that is the limit.

As a result, other breakfast has to be arranged.  I like a fried egg with fried veggies.  Of course, a bowl of cereal is always an option.  But my standard go-to is a smoothie.  Ingredients usually include:

  • Frozen fruit from Costco.  The kind you get in a giant bag.  It’s good to be sure you like whatever you’re getting, because you’re going to eat a lot of it.  As I have learned form experience.
  • Coconut milk.
  • Boiling water.  This is weird, but I don’t like frozen smoothies for breakfast in the winter, when the apartment is cold when I wake up.  Adding some boiling water melts the frozen fruit, and means the whole thing will be room temperature (neither cold nor hot).
  • A banana.  Critical.  Makes it smooth and filing.
  • A handful of oats.  More filing that way.

Even if I’m going to also eat a bowl of cereal or a bagel, this makes me feel at least like I’m getting in some vitamins in the morning.

Of course, there’s also always bacon.

Dog DebtFreeJD on a bacon morning.

Dog DebtFreeJD on a bacon morning.

 

 

 

Article On Millenials

This article, called “Bad News for the Class of ’08,” makes for an interesting read.  It’s nothing I haven’t heard before, but it has a couple of anecdotes about folks who graduated right after the recession hit (as I did), and makes the point that when you graduate has a long-term impact on your wages, even after a recession has ended.  People who graduated in 2011-2013 are likely to making less than their slightly younger and slightly older counterparts even well after we’ve seen the last of the Great Recession.

 

Floor 34: The Winter The Car Fell Apart

Here is why you need some kind of emergency fund, even if it’s not a big one:

Sometimes you pay about a bazillion dollars in car expenses over the course of four months.

OK, this is really just a gripe, but so far this winter:

  • The alternator blew, taking out the battery and a belt.  Or the battery died dramatically, killing the alternator and the belt.  Or the belt . . . you get the point.  That was expensive.
  • Driving down a two-way street that had become one-way due to poor plowing, I completed the job I started three years ago, and completely knocked off the passenger-side mirror.  (It had been wobbly for years; Mr. DebtFreeJD was glad I finally agreed to cough up the money to fix it).
  • The car got recalled.  Twice.  At least now our steering wheel airbag should deploy in a crash?  That was free, but whatever, I’m adding it to the list because it’s my list.
  • And the latest.  For totally inexplicable reasons, the rear bumper is peeling away from the car on the left-hand side.  We don’t yet know the $ damage on this one, but it sure looks expensive to me.

Arg.

At least we only have one car.

 

Floor 33: The Free Lunch

If you work at a firm, there IS such thing as a free lunch.  Well, it’s not free.  The firm pays for it. But free for you!

I am always puzzled when I see other young attorneys failing to sufficiently take advantage of the many, many free lunches out there.  Here are my top free lunch sources:

  • Get on the hiring committee for associates.  This is absolutely the #1 best source of free lunch.  First, lunch is expensive (but not for you, it’s free!).  Second, it is delicious.  Third, during hiring season, there is a lot of it.  Fourth, even though it’s tasty and free, you’re a good firm citizen for taking advantage of it.  Alas, I am not on the hiring committee, but am occasionally allowed to pinch-hit when the regular members are swamped.  If you can weasel legitimately convince your way onto such a committee, good for you!
  • Lunch-time bar association events.  I far, far prefer these to dinner-time bar association events.  Lunch is usually reheated chicken, pork, etc. in buffet trays.  However, I find nothing wrong with that.  It’s also a good way to be a good firm citizen AND get to know the local members of your bar.  Free lunch, good for your career.  Win-win, I say.
  • Training lunches.  Every associate knows about this.  Obviously you go, even if you are only going to sneakily pick up food, then “notice” an “emergency email” and run back to your desk.  If you are not taking advantage of these, I don’t think I can help you.
  • Working lunches.  This is the “I’m-Taking-A-Deposition-And-They-Ordered-Sandwiches” lunch.  Not exciting.  If you’re part of one, you know it.  If you’re not part of one, people get territorial about their food, especially if they’re at hour 8 of a 12 hour deposition.  I do not advise trying to crash a Working Lunch.
  • The left-overs from the Working Lunches.  At my firm, these leftovers are deposited at random times in the lunch room.  Knowing when to get there (and that they’re coming) requires either inside information from those in the Working Lunch, or an in with those long-time members of the firm who have developed a 6th sense for when leftovers will reach the lunch room.  It’s worth developing your contacts just for this.  I have most certainly done so.

 

Floor 32: Make Cheap Food Delicious

One sure-fire way to save money is to cook at home with cheap ingredients.  We are not quite ready to adopt the Frugalwoods rice and beans based lunch, but there is a decent amount of eating the magical fruit in the DebtFreeJD household.  One particular favorite is lentils: good for you, inexpensive, no soaking required, and thus achievable as a weeknight dinner.

Lentils come in lots of tasty forms.  However, there is one magic ingredient that makes them irresistible.

Coconut milk.

I add a spoonful, and it turns something that’s cheap and healthy into something that feels like I’m eating a cheeseburger.  Feels, I said, not actually tastes like a cheeseburger.  I’m not actually certifiable over here.  YET.

Other great uses of coconut milk:

  • Put some in a smoothie.  Preferably one with a tropical theme.  (Are little umbrellas in your smoothie not-frugal approved? Don’t tell me, I don’t want to know.)
  • Add some to your tea.  Those who know me will not be surprised to hear I’ve got some that is tropical-themed in the Giant Tea Shelf With What Would Be A Life Time Supply of Tea for a Normal Person.
  • Really any vegetable soup pureed with a teaspoon of coconut milk is good.  Mr. DebtFreeJD makes fun of me for this  (there are jokes about baby food) but as this is pretty far down the list of top 100-craziest things I do, I’m not worried.
  • Also good in oatmeal, farina, and rice pudding.

I wish I could clue you all in as to some super cheap source of coconut milk, but we just buy the stuff in cans at our local grocery store.

This is a totally gratuitous DogDebtFreeJD picture.  I guess she's kind of the color of coconut milk when she's clean?

This is a totally gratuitous DogDebtFreeJD picture. I guess she’s kind of the color of coconut milk when she’s clean?

 

 

Floor 31: Decide Your Commitment to Paying Off Debt

While we are in debt-repayment mode, Mr. DebtFreeJD and I are living off his salary.  Our goal is that at minimum, 100% of my salary goes towards repaying debt.  During that time we are not:

  • Investing any money in my (available) 401K.  I only have about $8,000 in an IRA.  Obviously not great.
  • Saving up for a house.
  • Investing in the stock market.
  • Participating in any other kind of tax-deferred account, other than Mr. DebtFreeJD’s 403(b).

Does this make sense financially?

Um, probably not.

It did while my loans were still at an 8% interest rate.  However, I recently refinanced into a variable rate loan, and my interest rate is hovering at around 3.7%.  As a result of my single-minded focus on debt, we are paying a whole heck of a lot in taxes.  We make too much to qualify for the student loan interest deduction, and we don’t have kids or a house, so not having any tax-deferred income on my end means we’re handing over a hefty sum to the federal and state governments.  Also, house prices in our city are such that it would definitely be cheaper to buy than rent, so every month we delay getting ourselves into a house is costing us.*

So why are we doing it?

I have limited bandwith.  It took me a long time to accept that, but there it is.  I can only take on so many projects at once, and taking on too much leads to abject failure.  Reforming my whole financial house in one go was never realistic for me, and I – in an unusual moment of self-awareness – knew better than to try.  However, throwing all the dollars we could at loans did seem like a goal I could focus on.  For me, it’s much better to have one big project than lots of small things whizzing in every direction.  If I’m writing a brief, I can’t have gchat open, my email dinging, and listen to my secretary** chat outside my door.  I need to shut down everything but the brief, close my door, and put in ear plugs.  The same applies here.  Going after my debt like Dog DebtFreeJd after a peanut-butter stuffed Kong was the only approach that was going to result in real progress.

Is this a good idea for other people?

If you are repaying your loans over a long-term period, probably not from a financial sense.  I’m ok not contributing to a 401K (and therefore paying a higher effective tax rate than your average billionaire) and not being in a rush to buy a home because this project is only slated to go on for a year or so.  If it were to go on for longer than that, if I was being purely rational, I would sit down, run the numbers, and figure out what makes sense.

On the other hand, I’m not purely rational.  And debt sucks.  I hate debt.  Even though the numbers show student loan debt is not going to collapse the U.S. economy, at least anecdotally, having lots of student loan debt is like having a suitcase full of rocks chained to your foot.  I just don’t want to be dragging that thing around for the next five to ten years.  Again, my bandwith is limited.  So for right now, my radio is tuned to just one channel: W-DebtFree: “Let Freedom Ring.”

*We are actually actively house-hunting.  Let’s call that process not-that-fun and very time consuming.

**I love my secretary.  She is life-saving, and this is to no way imply any kind of criticism of her.  She almost certainly spends less time chit-chatting at work than I do.

Dog DebtFreeJD is Interviewed!

Many thanks to Frugal Hound of the fantabulous blog Frugalwoods for taking the time to interview Dog DebtFreeJD! If you are interested, Dog DebtFreeJD’s insightful and serious answers to Frugal Hound’s questions are here:

http://www.frugalwoods.com/2015/02/04/frugal-hound-sniffs-debtfreejd/

The whole DebtFreeJD family hopes karma will bring Frugal Hound many milk bones and dreams of catching squirrels in thanks for putting up with Dog DebtFreeJD’s silliness!

 

Floor 30: No Car Commute

As I walked home from work tonight, nose frozen, toes numb, climbing over snow piles that would have been much better suited to a mountain goat than a mid-level associate, I had only one thought:

I am so glad I’m not in a car.

I have done the long-commute thing.  At it’s lowest (highest?) it involved a 2.5 hour minimum round-trip drive through the Holland Tunnel.

I’d say one of the biggest factors in Mr. DebtFreeJD’s and my ability to pay off my loans is the fact that we now both walk or bike to work, and otherwise use the car infrequently.  This allows us to:

  • Have only one car.  We bought it used, and for cash, about five years ago.  Other than an incident where the alternator blew, taking out a belt and a battery with it, it’s been pretty cheap and reliable to keep going.
  • Avoid maintenance problems. Lots of commuting (especially the kind I was doing!) puts lots of wear and tear on a car, not to mention mileage.  And of course, it raises the risk you’ll get in an expensive accident.
  • Park on the street, rather than a garage.  Parking around here is between $100-$200/month.  Not the we-could-rent-a-small-apartment-somewhere-else prices you’d pay in New York City, but still enough that we’re glad to avoid the cost.  The only trick is paying attention to our local unpredictable towing rules.
  • Fill up our gas tank about once or twice a month.  Yes, gas is cheap right now.  But even when I was driving in the land of cheap gasoline (aka New Jersey), filing up the tank once or twice a week would set me back about $200.
  • Not pay tolls.  Because nothing is more delightful than paying $12.50 per round trip to sit in hours of traffic waiting to cross a Port Authority-owned bridge or tunnel.

Plus, there are other benefits, like:

  • Exercise.   I’m a lawyer.  Exercise does not come naturally.  Walking to work is a pretty painless way to burn some calories.
  • Fresh air.  See above.  My natural habitat is hunched over a computer in my office.
  • Time to think.  On second thought, not sure whether this is a benefit or not.
  • Not having to participate in the farce known as “driving in a metro area to work.”  I would say literally a good 10% of my thoughts when I was still driving to work were things like: “Thank you so much for blowing your horn for 90 seconds while we are all stuck in two hours of traffic.  I’m sure that is definitely going to speed things up.”; “Indeed, do run me over with your giant SUV because you realized two feet before the exit ramp that you wanted to get off here”; and “Boy, how interesting to have tied four mattresses to the roof of your car with what appears to be dental floss.”

All in all, our car-free commutes save us many hundreds of dollars per month.  We don’t even have to pay for public transportation.  (I know, we’re spoiled – we feel so lucky that we could arrange our lives like this).

And of course, if it gets too cold, I can always channel Dog DebtFreeJD’s attitude to winter.

Dog DebtFreeJD pretends to be a noble beast.

Dog DebtFreeJD pretends to be a noble beast.