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time to zero net worth

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  • time to zero net worth

    Today marks two important milestones for me. First, it's been almost one year exactly since I finished training. For those in school or in training still, hang in there -attending life is awesome and really makes you feel like all the years of sacrifice are worth it.  Second, it's payday and the moment my paycheck hit the bank today was the first time in many years that we have been "in the black".  I still have some student loans outstanding but they have been refinanced for under 3% so I've been prioritizing tax advantag savings. With the upward momentum in the markets lately, we have exceeded our goal to hit a net worth of zero within 18 months from graduation. We've been blessed in many ways this year but a good bit of the credit for this goes to Jim Dahle and the combined online communities of Bogleheads and the WCI. Thanks everyone for pointing me in the right direction.

    For those interested in details, we were in the red by low six figures at the end of med school. One income, stay at home wife with kids (now 4). Used IBR in residency and fellowship so I had 6+ years of payments at the end of training but because of a prior mistake (I did a federal consolidation to simplify life from 3 lenders to one) I would not have been eligible for PSLF for another 6 years. In the end it was a good choice for me to abandon PSLF, take a private job, and refinance. Also, YNAB was very helpful for us to slow down lifestyle creep. I can't do the Dave Ramsey scream for being debt free yet, but I'm happy for now though to yell ZERO (net worth)

     

     

     

     

     

     

     

     

     

  • #2
    Isn't it awesome finally to be broke?

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    • #3
      Rookie question, how do you consider a mortgage as far as net worth goes?

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      • #4
        I don't have a mortgage anymore (had one in residency) but if I did I'd count the payoff number (outstanding balance plus a little more interest) in the liabilities and 90% of the realistic market value as an asset. It's not a liquid asset and you lose at least 8% in real estate commissions, closing costs, transaction costs etc.

         

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        • #5




          Rookie question, how do you consider a mortgage as far as net worth goes?
          Click to expand...


          I consider ours to be negative. I then add the equity in the house back in though.

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          • #6
            A SAHM and FOUR kids? That is awesome to reach zero only a year after residency. Applause for your hard work and determination. "Your" being plural, as I have a strong feeling your wife was just as committed to the process as you - makes such a difference.
            Our passion is protecting clients and others from predatory advisors. Fox & Co CPAs, Fox & Co Wealth Mgmt. 270-247-6087

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            • #7
              Great work! Getting back to broke is no easy task for a doctor.

              I guess from a money perspective alone we graduated from med school with a positive net worth, but that's not counting the fact that we owed four years! Hard to put a price on that to determine exactly when we were really back to broke, but I would guess 2-3 years out of residency.
              Helping those who wear the white coat get a fair shake on Wall Street since 2011

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              • #8
                Congrats OP! I can't wait to reach zero myself. Graduated last year with ~$370k in loans and my current net worth is negative $140k. Hoping to be at bet 0 by mid next year !

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                • #9
                  My wife and I started at -726k 7/2014. Should hit 0 7/2017. First of many big financial milestones to come.

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                  • #10




                    My wife and I started at -726k 7/2014. Should hit 0 7/2017. First of many big financial milestones to come.
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                    That's this month!

                     

                    We are pretty far away from hitting 0. Alas.

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                    • #11




                      My wife and I started at -726k 7/2014. Should hit 0 7/2017. First of many big financial milestones to come.
                      Click to expand...


                      Well done! Just think how quickly that is going to grow above $0!

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                      • #12







                        My wife and I started at -726k 7/2014. Should hit 0 7/2017. First of many big financial milestones to come.
                        Click to expand…


                        Well done! Just think how quickly that is going to grow above $0!
                        Click to expand...


                        Yea it's amazing when compound interest is working for you instead of against you eh?
                        Helping those who wear the white coat get a fair shake on Wall Street since 2011

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                        • #13










                          My wife and I started at -726k 7/2014. Should hit 0 7/2017. First of many big financial milestones to come.
                          Click to expand…


                          Well done! Just think how quickly that is going to grow above $0!
                          Click to expand…


                          Yea it’s amazing when compound interest is working for you instead of against you eh?
                          Click to expand...


                          ...but *is* it really compounding against them, though?

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                          • #14
                            Awesome job! Your post made me look at where I am. I should be at Net Worth 0 in 2 months ! Woohoo! That would be 26 months after residency.

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                            • #15













                              My wife and I started at -726k 7/2014. Should hit 0 7/2017. First of many big financial milestones to come.
                              Click to expand…


                              Well done! Just think how quickly that is going to grow above $0!
                              Click to expand…


                              Yea it’s amazing when compound interest is working for you instead of against you eh?
                              Click to expand…


                              …but *is* it really compounding against them, though?
                              Click to expand...


                              If you have debt you have some compound interest working against you.
                              Helping those who wear the white coat get a fair shake on Wall Street since 2011

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