Can I afford a home?

[Tyche]

We considered that, but wife's mother has Alzheimer's and father is 70 with health problems. My parents are here too though ok health knock wood. So would like to stay reasonably close. Wife is constantly helping her dad out. We imagine someday soon wife's mom may need nursing home.

Ah, I'm sorry to hear about her father. So good you're able to be close and spend these years with them.

A couple thoughts after catching up on the thread. My spouse finished training in 2018 and stayed at the same institution for the job. We have lived in this city since 2012 and yet we didn't buy when he finished, and still haven't. I was flabbergasted the first time someone suggested renting for at least a year, and shocked by what I considered a "pile on" when I first came to the forum. It was really tough to forgo that expectation that we would "finally" own, especially when our friends were moving to new locations, new jobs, and taking the plunge. Well guess what, year 2 spouse wasn't sure if this position would work out and now in year 3 we're wondering the same thing but for different reasons. At a certain point of course we will buy, but not doing so immediately was the best financial choice we could have made. It sounds like you are in your location for good, but give it some time and space. It takes at least 6-12 months to get your bearings after training. This time next year I think you'll have a much better sense of what really matters.

Finally, treading carefully here, and only saying this because you mentioned looking into different options for starting a family. I have a childhood friend who has been told since adolescence that she wouldn't be able to have kids. They went the traditional adoption route twice and then about a year ago I was shocked to see her very pregnant on social media. She now has a beautiful one year old whom she successfully carried to term through embryonic adoption. I don't know much more about it than that but it's pretty amazing. Looks like it's cheaper than traditional adoption too.

[jfoxcpacfp]

You bring up a fair point. To bring context, this forum is a physician financial forum. As a group, we’re probably in the top 5% of financial literacy of physicians.

I would reduce that number by half, at least.

[Hatton]

What is your wife's age? Are you sure you have exhausted all your options short of surrogacy? I delivered multiple babies for over 40 primigravidas including ones with a miscarriage history in my 30+ years of OB.
In your situation I would echo that you are making progress but you have to recognize the math here. You have a lot of factors working against you from a personal finance perspective.
I would start an expense tracking spreadsheet. I personally use Quicken but there are several different products out there. This will really open your eyes as to where the money goes.
I would double and triple check that PSLF is in order for you.
I would automate at least 25% into retirement.
I would not buy the house at this time.
Being a physician does not guarantee a comfortable retirement you have to work on that also.

[CalMD]

Can the OP work extra hours? It appears the salary is relative on the lower end for HCOL area. Moonlight, take extra call, shift, weekend, and whatever during the first few years to save for the downpayment, surrogacy, home repair/remodeling, etc. It seems there is always 10-15% of physicians on some kind of leave in an organization. As bad as COVID19 this year, we actually need extra office hours here even in California. Especially before the baby arrives, there should be extra time to work.

A dollar earned and saved at younger age is worth more, especially at age 41.

Hopefully the 40-minute commute is during normal, non-COVID19 rush hour times. Otherwise in HCOL, there could be possibility commute hours will be long again.

We actually prefer older houses especially in HCOL areas. Remodeled, move in ready houses tend to be much higher priced. It's like buying a new vs used car. Our first house was build in the 1920's. The current house was build in the 1960's, so a house from the 80's would be "modern" for us. One can learn so much from older houses. IKEA, HomeDepot, and Lowe's, and home remodeling forums could be your best friends!

[Behind the Curve]

Ah, I'm sorry to hear about her father. So good you're able to be close and spend these years with them.

A couple thoughts after catching up on the thread. My spouse finished training in 2018 and stayed at the same institution for the job. We have lived in this city since 2012 and yet we didn't buy when he finished, and still haven't. I was flabbergasted the first time someone suggested renting for at least a year, and shocked by what I considered a "pile on" when I first came to the forum. It was really tough to forgo that expectation that we would "finally" own, especially when our friends were moving to new locations, new jobs, and taking the plunge. Well guess what, year 2 spouse wasn't sure if this position would work out and now in year 3 we're wondering the same thing but for different reasons. At a certain point of course we will buy, but not doing so immediately was the best financial choice we could have made. It sounds like you are in your location for good, but give it some time and space. It takes at least 6-12 months to get your bearings after training. This time next year I think you'll have a much better sense of what really matters.

Finally, treading carefully here, and only saying this because you mentioned looking into different options for starting a family. I have a childhood friend who has been told since adolescence that she wouldn't be able to have kids. They went the traditional adoption route twice and then about a year ago I was shocked to see her very pregnant on social media. She now has a beautiful one year old whom she successfully carried to term through embryonic adoption. I don't know much more about it than that but it's pretty amazing. Looks like it's cheaper than traditional adoption too.

Hi thanks for telling me about your situation. Yea after much discussion and consideration of the advice in this thread, we decided not to buy right now. We're saving up for the baby instead. I appreciate your final paragraph. Unfortunately, it's been such a tough time that we don't want to risk the disappointment again.

[Behind the Curve]

What is your wife's age? Are you sure you have exhausted all your options short of surrogacy? I delivered multiple babies for over 40 primigravidas including ones with a miscarriage history in my 30+ years of OB.
In your situation I would echo that you are making progress but you have to recognize the math here. You have a lot of factors working against you from a personal finance perspective.
I would start an expense tracking spreadsheet. I personally use Quicken but there are several different products out there. This will really open your eyes as to where the money goes.
I would double and triple check that PSLF is in order for you.
I would automate at least 25% into retirement.
I would not buy the house at this time.
Being a physician does not guarantee a comfortable retirement you have to work on that also.

Thank you. Re: the wife getting pregnant, that was more likely when I first made this post, but over the holiday, wife found out she's in early perimenopause. She's 42. I will double check progress on PSLF. I signed up for Mint.com since my last post, but that isn't an expense tracking one. I'll look into the expense tracking apps.

[Behind the Curve]

Can the OP work extra hours? It appears the salary is relative on the lower end for HCOL area. Moonlight, take extra call, shift, weekend, and whatever during the first few years to save for the downpayment, surrogacy, home repair/remodeling, etc. It seems there is always 10-15% of physicians on some kind of leave in an organization. As bad as COVID19 this year, we actually need extra office hours here even in California. Especially before the baby arrives, there should be extra time to work.

A dollar earned and saved at younger age is worth more, especially at age 41.

Hopefully the 40-minute commute is during normal, non-COVID19 rush hour times. Otherwise in HCOL, there could be possibility commute hours will be long again.

We actually prefer older houses especially in HCOL areas. Remodeled, move in ready houses tend to be much higher priced. It's like buying a new vs used car. Our first house was build in the 1920's. The current house was build in the 1960's, so a house from the 80's would be "modern" for us. One can learn so much from older houses. IKEA, HomeDepot, and Lowe's, and home remodeling forums could be your best friends!

I'm not all at handy so I'd be concerned we'd have to hire so many people to remodel. Also, I've been told by friends that the older houses will have so much wrong with them that all the money you may save in a 1920s home purchase you make up for in fixing. Is that not true? I'm sorry if this sounds naive.

[8arclay]

I signed up for Mint.com since my last post, but that isn't an expense tracking one. I'll look into the expense tracking apps.

YNAB is excellent for actively budgeting and tracking expenses. Been using it for 7-8 years now