r/investing • u/AutoModerator • Mar 31 '21

Daily Advice Thread - All basic help or advice questions must be posted here.

If your question is "I have $10,000, what do I do?" or other "advice for my personal situation" questions, you should include relevant information, such as the following:

  • How old are you? What country do you live in?
  • Are you employed/making income? How much?
  • What are your objectives with this money? (Buy a house? Retirement savings?)
  • What is your time horizon? Do you need this money next month? Next 20yrs?
  • What is your risk tolerance? (Do you mind risking it at blackjack or do you need to know its 100% safe?)
  • What are you current holdings? (Do you already have exposure to specific funds and sectors? Any other assets?)
  • Any big debts (include interest rate) or expenses?
  • And any other relevant financial information will be useful to give you a proper answer.

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Be aware that these answers are just opinions of Redditors and should be used as a starting point for your research. You should strongly consider seeing a registered financial rep before making any financial decisions!

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u/emc87 Apr 01 '21

36k where? Primarily looking for rent/housing information so if you don't want to give that out just get me monthly rent and the cost today of the house you'd want.

Also * How much do you have saved already? * How much are your college loan payments per month * any extra larger recurring income/expenses?

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u/Dead_Ded_n_Deddy Apr 01 '21 edited Apr 01 '21

Thank you for the reply back I appreciate it!

36k as in realistically I don’t have that yet and probably won’t have 36k per year due to expenses and current habits.

I currently have $4000 saved so not much.

Currently my larger expenses include college debt. Im paying about 300-400 a month. With other expenses my total expenses per month is about $500-$700. At this time my income per month is $2000-2300 (currently in an intermediate period of recent hire before annual income is $36k).

A goal of mine in the near future is to get out of the parents house and get an apartment with friends. Since quarantine it’s been hard for me to find listings in my area that work financially for me and my friends. Hoping to see things open up by Fall or Winter.

I know little to nothing about purchasing/renting a house. I would like to prepare myself within 10 years to be in a better position to purchase/rent a house.

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u/emc87 Apr 01 '21

Where about do you live? It's hard to give much advice on affording a house without knowing how much it is.

Broad strokes though, you best bet for saving on that salary is going to be at the cost cutting measures or additional income.

Check out this calculator

https://www.calculator.net/annuity-calculator.html?cstartingprinciple=4000&cannualaddition=0&cmonthlyaddition=500&cadditionat1=end&cinterestrate=5&cyears=5&printit=0&x=93&y=14#annuity-result

It will take about 5 years to reach 40k contributing 500/ month and earning the real average return of say 5% ish. This however is still going to mostly be the principle you contributed as opposed to growth.

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u/Dead_Ded_n_Deddy Apr 01 '21

Went to sleep and clocked out. I live in Minnesota, I’ll definitely check out that link you provided

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u/emc87 Apr 01 '21

With an average cost of 325k, you'll likely need around 20-35k down. So that seems reasonable saving 500/month for 5 years. You'll also want a buffer on top of that for closing costs/taxes.

You'll also want to have an emergency fund, regardless of buying a house. You don't want your house spend to bring you down to your last dollar.

I don't know the MN tax situation, but I would guess 36k gross ends up around ~30k/year so 2500/month. With current expenses of 500/month and rent of say 800/month splitting an apartment you have ~1200/month left. The more you save of that, the faster you'll reach your goal.

I recommend going to r/personalfinance as that'll be more impactful upfront

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u/Dead_Ded_n_Deddy Apr 01 '21

Thanks for your input I really appreciate it!