The Unemployed Budget: Part 1

While I was getting used to the luxury of taking home $6k after tax per month – and saving a significant amount of it while not cutting my spending too much – now I need to really get frugal. On the other hand, now I have TIME which when I’m working I don’t have much of, so I want to use it and actually do the things I would do if I had time… but those cost money. It’s a tricky situation.

My networth goal this year was (and still is) $300k minimum exiting 2014. That seemed very doable prior to losing my job but now, yikes, it doesn’t seem that doable at all, save for a major boost in the stock market or accepting another gig that pays well enough to make up for lost time in a month or two.

Part of me is tempted to pack and hit the road (or airport) and travel somewhere new. When else in my life will I have TIME to go away? While I can’t do that while I’m filing unemployment, I’m paid out until the end of this month for my last job so I could go somewhere and take time to find myself. However, my boyfriend wants me to stay home and spend time with him, so it’s tough to hit the road. I just know that in the next few years I’ll be so busy with work and then likely have kids – at which time travel will become even more unlikely for many years.

At the moment though I’m keeping costs as low as possible. I want to exit this month at $285k. My current networth according to mint is $273k but that is missing a bunch of expense checks and healthcare reimbursement, so it should really be above $280k. I don’t know if it’s possible to get to $285k this month but this is why I’m torn on whether I should spend money now to travel while I can and before I really hit the ground running on my job search or if I should just take out $2000 or something for a trip (I have enough frequent flier miles for a free flight at least) and just deal with making up the money later when I have my next job. OR do I take a bootcamp like class for $10k and go into a lower-paid job and just accept that this year I probably won’t hit my $300k goal (ugh it was $325k which I thought was going to be do-able but now it’s def $300k and I’ll be happy.)

The good news is now that my annual income has dropped severely I’m eligible for a Roth IRA this year. If I do go to grad school next year my income will be even lower, at which time I’d do a Roth IRA conversion of all my delayed tax IRA accounts. And then I just have to work really hard to play catch up as I really want $500k in personal networth by the time I’m 35. Somehow I have to get there. Even if I could do a job for 2 years that pays $175k (or about 8000 a month after taxes) I could definitely live on $3k a month and save $5k a month. Two years of that and I’ll have saved $120,000! I could cut back even more to bump that up higher, getting me much closer to my $500k goal. OR I go to grad school for three years and accept I’m going to be far from $500k but preparing myself for a career in a field that I actually enjoy and can succeed in for the long term. What to do what to do.

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