need a pat on the head or a newspaper on the nose

[jfoxcpacfp]

 

Muaddib wrote:

35 years old, 5 years out of training,  3 kids under 7   the 190k is the main 401k we’ve had for the past 5 years with employer match

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Definitely not a newspaper on the nose. You've done a fine job of saving and your priorities are in order. Count yourself blessed that you "qualified" for a family loan. No further comment b/c I don't know enough about your family dynamics; I've recommended them many times in the right circumstances (when the family can afford and the borrower is an honorable person).

The perspective articulated by The White Coat Investor's is key - it is easy to believe that the posters on this forum are the norm. They're not. There are far too many who have shame about their finances and are unaware they are far more typical than atypical. Hopefully, your thoughts will encourage others to share. Thank you for posting.

[RadDoc6876]

Your level of financial self-awareness makes you more than a "noob" and you are definitely doing OK.  In fact you are way ahead of many of your peers.  Agree with about re: paying off family debt then just stay the course!

[Muaddib]

thanks for the encouraging words all, I appreciate it.  Still wish I could go back in time and smack my intern face with a WCI book and make this all a little easier.  we might ease up on the family loan repayments which are kind of the " no you don't need to pay us back it is our gift to you but we'll still hold it over you for the rest of your life and it was kind of our retirement money" kind of thing.

[Muaddib]

we've been averaging about 1-2k a month for the payments. it's definitely one of those gifts that we will sleep easier at night when it's paid off no matter what the 'rents say

[Dicast]

I'm with everyone else on this one.  I think you're doing great.  I've been out for nearly 5 years come July (2 years academic EM, 2.5 years and counting private) and I've amassed 225k in retirement funds which feels pretty good to me...and you're right there.  While some people may be ahead of us, I don't think it is that many.  You owe less than a years salary on your house, no car debt, no credit cards.  What would you really do right now if you retired anyway?  Work is stressful, boredom is deadly.  If you just figure out the "student loan" so you quit stressing I think you'll be just fine.

[Dru]

@muaddib - I'm intimidated most days I log on to WCI as well, and I've been following about 5 years. Same age as you, primary care, 2.5 years out of training, 2 kids. Last year 33% of our gross income went to retirement savings or loan repayment. So I won't be commenting on the Tesla thread anytime soon, but so many of my cohort who I talk to with blended 7.4+% med school loan rates haven't refinanced and just really have no idea. So I think we're doing ok for now. But this site inspires me to always try to do just a little better.

[Hatton]

Dru wrote:

@muaddib – I’m intimidated most days I log on to WCI as well, and I’ve been following about 5 years. Same age as you, primary care, 2.5 years out of training, 2 kids. Last year 33% of our gross income went to retirement savings or loan repayment. So I won’t be commenting on the Tesla thread anytime soon, but so many of my cohort who I talk to with blended 7.4+% med school loan rates haven’t refinanced and just really have no idea. So I think we’re doing ok for now. But this site inspires me to always try to do just a little better.

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I am sorry if you feel intimidated.  I think the purpose of many of the docs who share net worth numbers is not to make others feel bad.  Many docs who post are not high income specialties.  I would just recognize that everyone makes some mistakes along the way.  You can make some non ideal choices and use them as a learning experience and end up just fine.  Compound interest is your friend.

[OUSOONERDOC]

@muaddib Here is another pat on the back! You are doing great! I am in similar situation but just 2.5yrs out of FM residency. Working hard to pay off student loans, Just passed the $100,000 mark on my 401K and have also paid off just over $100,000 on student loans. Debt free other then House and Student loans. Set to have student loans paid off by Beginning of 2019. Then can start maxing out 457, HSA, and both Roths. We are keeping a tight budget but still finding ways to enjoy life.  Future is bright for all of us interested enough to be on this website. Keep up the good work!

 

[jfoxcpacfp]

OUSOONERDOC wrote:

@muaddib Here is another pat on the back! You are doing great! I am in similar situation but just 2.5yrs out of FM residency. Working hard to pay off student loans, Just passed the $100,000 mark on my 401K and have also paid off just over $100,000 on student loans. Debt free other then House and Student loans. Set to have student loans paid off by Beginning of 2019. Then can start maxing out 457, HSA, and both Roths. We are keeping a tight budget but still finding ways to enjoy life.  Future is bright for all of us interested enough to be on this website. Keep up the good work!

 

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Sounds like you deserve a pat on the back, too, OUSOONERDOC, good work.

[Kamban]

Craigy wrote:

Second, I had a small loan from my dad that I was paying him back on. After making a few payments, he tells me don’t worry about it, I’ll let you know when to pay me back. Fast forward several months and he gives me a bill for all the interest I owe him. Next day I wrote him a check for the whole balance in full discharge of the debt.

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Not a criticism directed towards you or your dad but I am surprised a parent calculates interest on a loan given to a child. Something that would never have entered my mind if I give any money to my daughter.

[DMFA]

Do we really intimidate? I'm genuinely sorry to hear that. I've had a positive net worth for about six months now, and let me tell you, just getting to being broke was a rush.

[jfoxcpacfp]

Kamban wrote:

Craigy wrote:

Second, I had a small loan from my dad that I was paying him back on. After making a few payments, he tells me don’t worry about it, I’ll let you know when to pay me back. Fast forward several months and he gives me a bill for all the interest I owe him. Next day I wrote him a check for the whole balance in full discharge of the debt.

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Not a criticism directed towards you or your dad but I am surprised a parent calculates interest on a loan given to a child. Something that would never have entered my mind if I give any money to my daughter.

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Interest on family loans is not uncommon, especially when there are multiple siblings involved and the siblings who aren't borrowing money perceive it as a gift to the "favored" sibling. Since you mention only one child, this is possibly an issue you haven't experienced

Also, some parents, business owners in particular, want to teach their children financial responsibility, even if the repayments will eventually be recycled back as a gift.

My mom has loaned money several times to one of her grandchildren (my son, who invests in real estate) and my sister (an attorney) and I have always insisted on interest a little above market rate. Same principle and there are 8 grandchildren. He has always been grateful for the resource and has been honorable with the repayments.

[Kamban]

jfoxcpacfp wrote:

Interest on family loans is not uncommon, especially when there are multiple siblings involved and the siblings who aren’t borrowing money perceive it as a gift to the “favored” sibling. Since you mention only one child, this is possibly an issue you haven’t experienced

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I learn something new every day. Part of this is due to cultural differences, and hence a new perspective does not occur in my mind until I read something like this. 

[Craigy]

Kamban wrote:

Craigy wrote:

Second, I had a small loan from my dad that I was paying him back on. After making a few payments, he tells me don’t worry about it, I’ll let you know when to pay me back. Fast forward several months and he gives me a bill for all the interest I owe him. Next day I wrote him a check for the whole balance in full discharge of the debt. 

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Not a criticism directed towards you or your dad but I am surprised a parent calculates interest on a loan given to a child. Something that would never have entered my mind if I give any money to my daughter.

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Well the big difference is loan vs. give.

The loan or interest part didn't bug me, but the mixed signals did.

[Craigy]

Muaddib wrote:

thanks for the encouraging words all, I appreciate it.  Still wish I could go back in time and smack my intern face with a WCI book and make this all a little easier.  we might ease up on the family loan repayments which are kind of the ” no you don’t need to pay us back it is our gift to you but we’ll still hold it over you for the rest of your life and it was kind of our retirement money” kind of thing.

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:lol:

Yeah you have to pay this off, no doubt about it.

If they're not hitting you with interest, you could definitely just set the autopay on the current amount or less and just let it run its course.  But I'd still be eager to get rid of it, and as soon as I had a little pile of cash I'd be asking to settle somehow for a lump sum, just like they were a debt collector.  

Either way, in all seriousness, one thing that you should absolutely do for your own sake and sanity, is to make and keep a file of all of the records.  In addition to keeping a copy of each check (which might eventually be hundreds of copied checks), you should find and keep records of all the amounts that were loaned to you or spent on your behalf in the first place if it's at all possible.

After it's been paid, you want the satisfaction of it being over and done with.  The last thing you want to find out, after paying back $170,000 over several years, is that oh that was just part of it.  I don't know your family's situation, and hopefully they hardly even notice the money coming in and it really makes no difference.  But someone, especially someone in retirement, may start to count on those checks, and be surprised when it comes to a stop.  Especially as they become elderly, this confusion only grows.  Even if your parents don't care about it, some aunt or cousin or sibling might come asking one day hey doesn't Paul owe you some money, why did he stop paying you, you need that money, that's not fair.  There should be zero confusion on your end.