Beginner tips for a SINK

[I Find This Humerus]

Craigy wrote:

Yeah I don’t think SINK is a thing.  Single income is pretty standard across households.  Plus it’s too ambiguous… single income implies that you are married with a nonworking spouse.  Best term is probably just “single.”

DINK is a term to describe a relatively unusual but wonderful economic family unit where there are two incomes and no kids.  Aka living the dream.  Seems like a disproportionate amount of gay guys in this category.  Probably the biggest economic powerhouse physician couples will be male-male DINKs since their likelihood of keeping alive both the 1) duality of income and 2) no kids parts of the equation are each tremendously higher.

Yeah, advice for a single person is like DFMA said on the first page, work as much as you can.  Make and save as much as possible while you still can.  As soon as you have another person living in your household, let alone children, not only will you not be able to put in nearly as many hours, but you’ll also have double (triple, quadruple++ when kids arrive) the amount of people spending the same (or perhaps now smaller due to less work) pot of money.

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But couldn't I argue that being single forever should let me work LESS knowing that my costs will be less? Or are you saying work more, build a big nest egg, and retire early?

[AR]

I Find This Humerus wrote:

AR wrote:

I Find This Humerus wrote:

AR wrote:

I Find This Humerus wrote:

To clarify I am single and have no plans of ever getting married or having kids. So what should I do?

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Well I think the standard answer in this case is hookers and blow.  Not that there is anything wrong with that, but feel free to substitute whatever else you happen to be into.

I’m only partially joking.  But the answer to your question (i.e., what you should do differently) is that you can spend way more freely.  Your expenses are going to be lower and the amount you require to retire is way less.    So travel, save up and retire early or if you have any expensive hobbies or interests, then indulge in those.  It’s almost impossible for you to mess this up.

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I still would like to know how/where to invest. How much? etc. ETF’s, bitcoin, etc.

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Like I said it doesn’t matter.  Anything reasonable will work out fine.  You don’t have to do anything different from a DINK:

1. Use all your tax deferred space.  Don’t really need to think about 529s unless you have a specific use in mind.

2. Just stick the rest in a taxable account

3. Any reasonable allocation is fine.  You could just stick everything in a targeted retirement account. If you want to diversify and put some it real estate, that’s fine too.   The possibilities are endless.  Just avoid anything obviously stupid and you’ll be fine.

The only difference is that you can comfortably spend more, if you desire. Unless you have a real spending problem, you’ll have more money than you know what to do with.

 

By the way, now that you’re newly single, what’s happening with the house?  Glad to hear that it was fiance and not wife.  You dodged a bullet there.

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Still in the market for a house. Was never interested in a giant McMansion so still deciding between buying new construction vs used. I’d rather build equity in a house than rent.

New construction comes with a bunch of malarkey that nickel and dimes you like a lot premium and fancy cabinets and drawers which at the core bothers me. Hate paying for things that are a scam and everyone knows are overpriced.

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The thing about a brand new home is that if you do it right, you're not really overpaying that much because you can get exactly what you want.

Obviously something that is already constructed is always going to be cheaper, but if you really don't care very much about what the cabinets are like, what the exact layout is, etc.  Then you don't really get much out of new construction.  Everyone I know who has done it has been quite happy with it because you can pretty much get a house that is almost exactly the way you want it. With something that's already built, you're going to have to settle to some extent.  With a custom home, there's almost no settling involved (most people who can afford this don't really have cost as a limiting factor).

I guess some developers have a lot of limitations on what they can offer, so there may be some constraints, but I'm thinking of cases where such limitations don't apply.

If I were single, I doubt that I'd build from scratch.  I just don't care that much and I don't really have to optimize the living space to account for a whole family.  But in my current state, with a family of four, if I ever move, I'll probably custom build.

[AR]

I Find This Humerus wrote:

Craigy wrote:

Yeah I don’t think SINK is a thing.  Single income is pretty standard across households.  Plus it’s too ambiguous… single income implies that you are married with a nonworking spouse.  Best term is probably just “single.”

DINK is a term to describe a relatively unusual but wonderful economic family unit where there are two incomes and no kids.  Aka living the dream.  Seems like a disproportionate amount of gay guys in this category.  Probably the biggest economic powerhouse physician couples will be male-male DINKs since their likelihood of keeping alive both the 1) duality of income and 2) no kids parts of the equation are each tremendously higher.

Yeah, advice for a single person is like DFMA said on the first page, work as much as you can.  Make and save as much as possible while you still can.  As soon as you have another person living in your household, let alone children, not only will you not be able to put in nearly as many hours, but you’ll also have double (triple, quadruple++ when kids arrive) the amount of people spending the same (or perhaps now smaller due to less work) pot of money.

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But couldn’t I argue that being single forever should let me work LESS knowing that my costs will be less? Or are you saying work more, build a big nest egg, and retire early?

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Do either.  Whichever you find more desirable.  It's almost impossible for you to mess this up.

[artemis]

Craigy wrote:

Yeah, advice for a single person is like DFMA said on the first page, work as much as you can.  Make and save as much as possible while you still can.

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Agree.  As someone who is single with no kids, I'd like to remind you that you can't count on having any help from family as you grow older; you're going to have to pay for everything you need in your old age.  So save aggressively!  "Moving in with the kids when I get old" will never be an option for you. (Not that it's a great option for those with kids, either, but at least it's a last-ditch possibility for them should the absolute worst happen.  It will be a non-existent possibility for you.)

And remember that the old saying "two can live as cheaply as one," while definitely an exaggeration, does have some truth to it.  Basic costs of living don't scale linearly as the number of people added to a household goes up.  Rent on a two-bedroom apartment generally doesn't cost double the rent on a one-bedroom unit, and a single person living in a typical 3 BR house doesn't immediately have to move if a spouse and 2 kids come along later.  Two people do eat roughly double what one eats, but couples and families can buy in bulk to to partially offset that, so the food budget doesn't necessarily double just because the number of mouths has.   Most health insurance offers "family plans," so costs there don't escalate linearly, either (thank God!).  You're spared the cost of raising and educating kids (which is substantial), but don't make the mistake of thinking that you can live on a lot less than the married folks do, because often that's not true.  Being a single person is actually expensive!

[Craigy]

I Find This Humerus wrote:

Craigy wrote:

Yeah I don’t think SINK is a thing.  Single income is pretty standard across households.  Plus it’s too ambiguous… single income implies that you are married with a nonworking spouse.  Best term is probably just “single.”

DINK is a term to describe a relatively unusual but wonderful economic family unit where there are two incomes and no kids.  Aka living the dream.  Seems like a disproportionate amount of gay guys in this category.  Probably the biggest economic powerhouse physician couples will be male-male DINKs since their likelihood of keeping alive both the 1) duality of income and 2) no kids parts of the equation are each tremendously higher.

Yeah, advice for a single person is like DFMA said on the first page, work as much as you can.  Make and save as much as possible while you still can.  As soon as you have another person living in your household, let alone children, not only will you not be able to put in nearly as many hours, but you’ll also have double (triple, quadruple++ when kids arrive) the amount of people spending the same (or perhaps now smaller due to less work) pot of money.

Click to expand…

But couldn’t I argue that being single forever should let me work LESS knowing that my costs will be less? Or are you saying work more, build a big nest egg, and retire early?

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Just the first two bits of the second bit.  Then you will have the money and freedom to do whatever you want.

Unless you find yourself tragically castrated, this blessed moment of living the single economic lifestyle (for a physician, no less) will in all probability be very shortlived.

Again, it may feel like you will be single forever right now but that's probably not going to be the case.

Now is the opportunity to pick up those extra shifts or that moonlight gig and put the money away for a rainy/children-filled day.   

[Phoenixdown99]

I am a (S?)SINK early career attending here who is planning to have kids down the road... I do spend a lot of $ on travel and adventure sports (but at least much of it is tax deductible as I moonlight as a scuba diving teacher). I rent an apartment and own a condo that I rent out. I drive a used 2003 SUV and it works just fine.

I have no student loan debt, but I have a mortgage on the condo that I rent out. I don't feel the need to kill myself with extra call or overnight shifts to pay it off. I like having a good lifestyle and I enjoy my time off. I have disability insurance, no life insurance. I bought long term care insurance just in case because I do participate in a number of risky sports and I don't want my family stuck with a huge bill if something terrible happens, G-d forbid.

I maxed out my limited retirement options (401K and backdoor Roth) and decided to open up an index-fund 529 for future children this year (I live in Virginia and I get a $4000 tax break per year for 529). I probably would have done this even if I wasn't planning to have kids, so that I could save on taxes and gift it to my nephews.

I haven't opened up a taxable account yet, but I'm planning to do so in the new year (Vanguard Total Stock Market Fund). That is my biggest financial goal for the new year.

 

[I Find This Humerus]

Phoenixdown99 wrote:

I am a (S?)SINK early career attending here who is planning to have kids down the road… I do spend a lot of $ on travel and adventure sports (but at least much of it is tax deductible as I moonlight as a scuba diving teacher). I rent an apartment and own a condo that I rent out. I drive a used 2003 SUV and it works just fine.

I have no student loan debt, but I have a mortgage on the condo that I rent out. I don’t feel the need to kill myself with extra call or overnight shifts to pay it off. I like having a good lifestyle and I enjoy my time off. I have disability insurance, no life insurance. I bought long term care insurance just in case because I do participate in a number of risky sports and I don’t want my family stuck with a huge bill if something terrible happens, G-d forbid.

I maxed out my limited retirement options (401K and backdoor Roth) and decided to open up an index-fund 529 for future children this year (I live in Virginia and I get a $4000 tax break per year for 529). I probably would have done this even if I wasn’t planning to have kids, so that I could save on taxes and gift it to my nephews.

I haven’t opened up a taxable account yet, but I’m planning to do so in the new year (Vanguard Total Stock Market Fund). That is my biggest financial goal for the new year.

 

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What's your story for being single and no kids?

[Phoenixdown99]

Just haven't found the right person to settle down with...I'm picky and trying to find someone in a pretty small religious group

Plus I'm pretty adventurous and independent (especially for a female), so I didn't feel the need to settle down and start a family unless I found the right person. However, due to biology, I might have to think twice about my strategies in the next couple of years :/

[Lithium]

I'm in the club, for similar reasons to PhoenixDown.

Mid-30s with a net worth around 1.7 Mil (just through combinations of luck and discipline).  I realize it's going to be next to impossible to meet someone as financially secure as I am, and marrying without a pre-nup would be positively terrifying.  I paid off my house over a period of about 18 months.  Now I've gone back to pumping money into the taxable accounts.  I live in a bigger house than I need, and rent for a 700-800 sq ft. apartment would be cheaper than what I pay every year in property taxes, repair costs, and the opportunity cost from tying up potential investable income in home equity.  If I sold my house and retired now, I would spend less than 3% of my net worth every year.

I have never had disability insurance.  Crazy, I know, but by the time I even learned about it my net worth was over half what it is now, and I didn't think the cost was worth what it would save in risk.  I still have home insurance, which I've thought of cancelling, and umbrella insurance, which I need to raise to 2 million.  I have a 9 year old Civic that looks older but only has 107k miles on it.  I mostly bike around town.  I'm proud to continue driving a beater, but I won't be that heartbroken if it gets totaled or kicks the bucket.  After that, it might be cheaper just to take Uber and rent cars for long trips.

I have thought of investing in real estate beyond REIT index funds, but it just seems like more trouble than it's worth and way too complicated.

I obviously don't need the income from full-time clinical work and doubt I'll keep it up for more than another couple of years.  I'm reading a bunch of books (currently 4 Hour Work Week) to try to figure out what might be next.  I've kicked around a lot of things from just buying an RV and boondocking from state to state, to working part time in retail for health insurance, to opening an unrelated pass-through business (tax preparation?), to doing very light locums work, or some combination of those options.  I do like to travel, but I have a pet, which makes globetrotting with a backpack and Airbnb account impractical.  If I relocate, I would like to go to a non-community property state with no income tax (possibly Tennessee).

If I could talk to myself ten years ago, knowing then what I know now, besides going 100% Bitcoin, I would say to cherish mobility more and not to tie myself down until my priorities had been fixed for several years and I knew I'd landed in the ideal spot.  The security of an employed position is not worth the cost in flexibility.  I would have been better off not buying a house.  And I really care about my pet, which is why I won't just dump her off with family, but it's easier to make some big changes if you don't have to live with one.

[Phoenixdown99]

Marrying without a prenup? ************************ nooooo!

I did locums for 8 months last year (mainly to see some cool places and try out different types of practice) and it was awesome. They will house both you and your pet (at least my company offered to do so). I decided she'd feel more comfortable in one place (it is a cat, if it was a dog I would have taken her with me) and left her at my parents' house...but now they don't want to give her back as they got too attached!

BTW has anyone ever considered retiring in Panama? I've been there, seems nice and considerably cheaper (if you can deal with the dengue/Zika risk...but every place has its risks).

[Lithium]

If I did "locums" I would rather it be an ongoing 1099 contract at a place in town for a weekend a month or PRN coverage for when a doc wants to take vacation.  I dislike dealing with recruiters and middlemen.  I still have locums recruiters calling and emailing me several times a week offering positions on the East Coast, not realizing I moved far away after residency.  That's what I get for posting contact info on a job board four years ago.

POF linked to a blog post talking about retirement in Panama in one of his recent Sunday Best roundups.  It was pretty informative.

[Sean]

Hi Lithium, Phoenixdown, & the OP.  I, too, am in the same SINK boat  :P

Between not wanting to marry until done with training, then being picky, narrow socio-religious group (like Phoenixdown said) moving around for work, etc. am still single but hope to settle down eventually if the stars align.  Re: finances, am fortunate that I've been fairly frugal throughout while enjoying travel and other interests, thus enabling me to accumulate a decent amount (low seven figures) over the years.

It's interesting to hear some of you have tried locum tenens.  I'm considering doing it too as I'm in the process of a job change to give independent contracting a go, mainly for the tax advantages and the solo 401k benefit with much higher limits than the standard employee limit.  I figure that since a W-2 employee arrangement is pretty limited in tax-deferred space opportunities, the other alternative is to be a partner, start my own practice, or be a freelancer to be self-employed.  Since the first two options are dicey in this day and age of medicine, the third seems more doable.  Any thoughts?

Re: prenups, I've noticed it's often a touchy subject for those without much in assets, but for those, esp women, with quite a large kitty in savings/assets, they are much more open to the idea of a prenup, and even bring it up themselves.  Understandable.

[Sean]

Hi Lithium.  As I'm exploring the world of locums, I realize how big a chunk recruiters take!  There was one who was trying to get me to cover weekend call sporadically at a facility and quoted me $800/day, which I felt was a bit on the low side.  So, she hesitantly offered $850.  I declined. Interestingly, when I called the hospital directly and asked about how much it paid locum docs for temporary coverage, I was quoted $2,000 !!!  I realize the recruiters claim they cover hotel, car rental, malpractice, etc., but that still doesn't justify taking a 60% cut!!!  ************************!!  Heck, easy and cheaper to book a hotel and car rental online myself!

[Hatton]

Well I am newly SINK after being DINK for 8 years.  I did not have a prenup.  Ex-husband refused to sign it.  I did ok because of two things 1. I did not encourage him to quit his job.  2. I never paid his bills or increased his lifestyle.  I do not live in a community property state.

[jfoxcpacfp]

 

hatton1 wrote:

Well I am newly SINK after being DINK for 8 years.  I did not have a prenup.  Ex-husband refused to sign it.  I did ok because of two things 1. I did not encourage him to quit his job.  2. I never paid his bills or increased his lifestyle.  I do not live in a community property state.

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It sounds as if you did everything right, sorry you had to go through that. Did you think the ex's refusal was a warning sign, which made you take extra precautions? Feel free to tell me to myob   .