Reader Case: Can this 24-year-old from DC Retire Early?

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It’s Friday, and you know what that means: Reader Case time! And for the first Reader Case of 2019, we’re gonna pick a doozy.


  • Gross Income: $95,000 (Combined)
    • Myself: $50,500/year.
    • My Husband: $60,000/year
  • Net Income: $75,000 (Combined)
    • Myself: $30,600 ( After tax, health insurance and 401k contributions)
    • My Husband: $45,000 (we pay his taxes deductions at the end of the year)
  • Monthly net income: Myself $2,550. Husband: $3,750 [Combined: $6,300/monthly]

Monthly Spending:

  • Transportation – $575 month (Ubers really add up quickly) [$6,900/year]
  • Cable – $127 (he can’t seem to live without sports channels) [$1,524/year]
  • Cellphones : $150 (both of us) [$1,800/year]
  • Utility Bill: $60 (Average Monthly) [$720/year]
  • Apartment Insurance: $14 [$168/year]
  • Entertainment ( Netflix & Apple Music): $20 [240/year]
  • Monthly grocery shopping : $320 ($160 X2 month) (Not too bad for a foodie) [$3,840/year]
  • Eating Out: $1,000 – $1,200 (Our hobby is to eat out on our day off, checks range $250-$300 weekly) Our money goes on food I KNOW, experiences! [12,000 – $14,440/year]
  • Rent: $2,000 ( Paying for convenience, we live in the heart of the city) [$24,000/year]
  • Helping Retired Parents: $400 [$4,800/year]

Total Monthly expenses: Approximately $4,800. The remaining income (~$1,500/month) goes to:

  • Paying off Credit Card: Ranges ~$1,000 – monthly payment
  • Saving: ranges $300-$600 monthly.

Fixed Assets: None (We are renting, thinking of buying. Don’t have a car and don’t consider it an asset)

Debt ( All Credit Cards Combined):

  • $2,496.28 – 14% Interest Rate
  • $1910.90 -6% Interest Rate
  • $768.52 – 20% Interest Rate
  • $981.34 – 0% Promotional Interest Rate
  • $374.66 – 26% Interest Rate

Total Outstanding Balance: $6,531.70 (Minimum payment on each card ranges from $20-$35)


  • Cash – $18,000. (checking/saving account)
  • CD – $352.69 (2.23% Rate)
  • 401k ( I Invest 25% of my income, company contributes 4%)
    • $9,705.55 ( 3.19% Rate of Return since 01/18) 100% on Balance Asset Allocation
    • $11,486.43 (4.23% Since 01/18) 90% Stocks, 7.8% Bonds, 1.6% Money Market
  • Stash – $383 (5.47% Return)
  • Acorns – $312 (2.28% Return)
  • Fundrise – $513.35

Total Assets Combined: $40,753.02

(Minus debt, total: $34,221.32)

Little bit about me:

  • 24 year old millennial living in Washington DC

Thanks, I would love to hear how we are doing 🙂


OK while my natural instinct is to start tearing into those spending numbers, there’s a couple more alarming issues to deal with first.

Never Hold Credit Card Debt!!!

The #1 most obvious sign of a financial newbie is when they simultaneously hold credit card debt and a cash balance. Mathematically, this makes absolutely no sense since credit card debt is costing you 15%-25% in interest while cash is earning 2% (if you’re lucky). However, people amazingly still do this, and it’s usually based on some emotional bullshit reason.

Something about holding a cash “emergency fund” feels safer “in case I need it,” when in reality that credit card interest is hammering you every single month. It’s totally irrational, and I know people in real life who think like this. No matter how many times I explain the math, they just fall back on the reasoning of “yeah, but it just feels better.” And they just continue doing it.

This approach makes zero sense. Even if an emergency does come up and you’re forced to go back into credit card debt, that’s still a better idea than voluntarily staying in credit card debt the entire time even with no emergency happening. That’s like voluntarily paying a hospital bill even though you haven’t been to the hospital!

In finance, few things are black and white. This is one of them. DCMillennialGirl, if you’re reading this, stop what you’re doing NOW, take that cash you’re sitting on, and pay off every single credit card.

Except maybe that 0% interest rate one. That one you can leave a balance on, but as soon as that interest rate becomes non-zero, kill it immediately.

Net Income Seems Suspicious

OK this one isn’t DCMillennialGirl’s fault, but her understanding of “net income” is wrong. Net income is the money you make each year after taxes. Her description of her net income as $30,600 (After tax, health insurance and 401k contributions) seems to indicate that she’s leaving her 401k contributions off her net income.

That’s wrong. The money you put into your 401k is still your money, so those contributions (and any employee matching that’s available) count as part of your net income. So that means both her and her husband’s net income numbers are under-reported here.

OK before we continue her analysis, we’re going to have to figure out what their actual net income is. Assuming their gross income numbers are correct, I’m going to use SmartAssets’ super handy-dandy tax calculator to estimate their taxes. Using 20500 as their zip code (which is the zip code of the White House, which I’m pretty sure is in DC), putting in DCMillennialGirl’s info (including the fact that she’s contributing 25% of her pay to a 401k), we get the following.

There. SmartAsset predicted a take-home pay of $31,830, which is pretty close to what DCMillennialGirl reported since that’s what she sees on her paycheck, but the actual number we care about is the circled one: Income After Taxes of $42,289.

On top of that, we have to take into account the 4% her company contributes, so that’s an additional $50,500 x 4% = $2,020 of income, creating a grand total of $42,289 + $2,020 = $44,309.

So that’s her’s. Now let’s look at his.

Plugging his numbers into the tax calculator and leaving the 401k contributions field at 0 gives us an after-tax income of $46,103. That’s pretty close to what DCMillennialGirl reported at $45,000, so that suggests that the husband’s not contributing to a 401k at all. To which I’d respond: Why not?

If he were to match DCMillennialGirl’s contribution rate of 25% of his gross, or $15,000, his taxes would look like this.

Now with a 401(k) contribution lowering his taxable income, his net income jumps to $49,780. Pretty good for doing no work, huh?

So How Are They Doing?

OK now that we have more accurate numbers, we can now MATH SHIT UP. To summarize, assuming they:

  • Start contributing to his 401(k) at a rate of 25% gross
  • Pay off the credit card debt

Their numbers are…

Income (Net)$44,309 + $49,780 = $94,089
Expenses$4,800 (monthly) x 12 = $57,600 (annual)

At that rate, how long would it take for DCMillennialGirl to retire?

Well, at an annual spending rate of $57,600, as per the 4% rule they will need $57,600 x 25 = $1,440,000. Yeowtch. $1.44 million. If that sounds like a tall order, that’s because it is.

And with a savings rate of $94,089 – $57,600 = $36,489, that sounds like an even taller order. Plugging those numbers into our spreadsheets, we can project DCMillennialGirl can retire in…


21 years.

Now, she’s only 24, so that puts her retirement age at 45. That’s already pretty damned good, and a full 20 years before normal retirement age of 65.

But I think we can do better. Why?

Their Spending is NUTS

Now, I know everybody’s budget is different, and I know not everyone’s into budgeting like FIRECracker is, but we’ve been travelling around Europe all year, eating out whenever we feel like, and our living expenses still came out to be around $40,000 for 2018. DCMillennialGirl is spending almost 50% more than us while living in one place! There’s clearly some wasteful spending here.

And the most obvious one is Transportation. $575 a month for Uber?!?

OK, I get the appeal of living close to downtown, and maybe paying a little more in rent for it. But if you’re paying $2000 a month in rent to not need a car, I’d expect your transportation costs to be a little more reasonable. $575 a month is what people pay in car costs when they live in the suburbs and have to drive to work every day. You don’t own a car, yet you’re still paying car-owning prices!

This is just wasteful. A monthly transit pass in the DC area costs $120. $120 x 2 = $240. That should be the maximum you’d ever have to pay for transport if you live downtown. And if you can manage to walk or bike to work in the summer like we did, you could drive this cost even lower.

Also, your food budget is just way too high. We like eating out as much as anyone else, but our total food budget (groceries + restaurants) rarely went above $1000 a month, and that’s in Europe.

What really helped us in this department was FIRECracker started cooking Paleo recipies, which involve a LOT of meat (hello steak!), fresh vegetables, and usually covered in delicious delicious butter. We ate better than ever before, our food budget plummeted, and somehow FIRECracker lost weight in the process. She’s never looked back, so check out an article she wrote on this for ideas.

And finally, the sports channels. Now, I’m not the most qualified person to give advice on sports channels, since I don’t watch live sports much these days (the Toronto Maple Leafs can only disappoint you so many times before you give up on watching sports forever). But paying $127 a month for a premium cable subscription AND a $20 Netflix subscription just seems redundant.

There are ways of getting access to sports channels without a cable subscription. Dish network, for example, offers Sling TV, where you can get access to ESPN/2/3 for $25 a month. If you have a Playstation, Sony offers another service Playstation Vue, which gives you ESPN access for $29.99 a month. And again, this is not an endorsement since I’ve never used either service, but if these work for DCMillennialGirl’s husband, that’s another $100 a month you can save right there.

Put it all together, by just getting these 3 areas under control you could potentially bring your spending down to $3900 a month, or $46,800 a year.

Annual spending of $46,800 a year means your portfolio target becomes $46,800 x 25 = $1,170,000.

That also bumps their savings rate to $94,089 – $46,800 = $47,289.

What does that do to their retirement?


It drops from 21 years to 16. That means our 24 year old millennial could retire by the age of 40.

What Do You Think?

So that’s our two cents. To be honest, spending $46k USD/year seems inefficient to us, considering the fact that we’ve just pulled off a year in Europe for $30k USD/year, but hey. Maybe that’s what it costs to live in DC.

What do you all think? Is DCMillennialGirl’s spending reasonable given where she lives, or does it still seem high to you? Let’s hear it in the comments below!

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54 thoughts on “Reader Case: Can this 24-year-old from DC Retire Early?”

  1. I’m the third generation of my family born in DC, but none of us actually lived in the city except when dad was attending GWU in the ’60s (he has got some STORIES). Wife and I live in a dope little city a couple miles outside the district with $150k condos and $350k houses, walkable to breweries and mom-and-pop restaurants and a distillery and a couple of organic grocery stores. It’s awesome — but I think potluck dinners with great neighbors beat four-figure monthly restaurant bills, so maybe that’s just me.

    My Google Fi bill has yet to crack thirty bucks. T-Mo unlimited is something like eighty bucks for two lines and Verizon prepaid unlimited is $120 for two lines, if you need rural coverage and lots of GBs. $150 for a cell phone bill seems kind of unnecessary.

    DC transit can be kinda laughable. It was nice in the 80s and 90s and early 00s until trains started ramming each other and randomly catching on fire. If you want to be out anywhere past midnight you’re gonna spend on uber and lyft, because WMATA is at least as much about providing stable careers to people without college degrees as it is about providing a world-class subway service.

    I wish them luck. This isn’t a cheap area, but it can be done — we’re on track for FIRE in eleven and a half years, the same month we pay off our house, just before my wife turns 49 (and we only started in earnest a couple years ago). It just takes a bit more conscientiousness than the numbers here suggest.

    1. I’m curious about this “dope little city” with such cheap housing…it sounds too good to believe? And do either of you commute into the city for work?

      1. Look up the city of Hyattsville. Don’t tell ’em I sent you. 😉 We don’t; I telecommute and my wife goes sideways into Silver Spring — but there are myriad routes via transit, auto, or bike.

    2. What small city do you live in ? That has such affordable condos? My Bf and i just left DC 6months algo . He’s born raised and lived there til age 25 . We talk about going back but FI and DC don’t really mix. But it seems like you’ve cracked the system.

        That was a couple miles from my house. I had just got off work and had to negotiate roads to pick up friends who were stuck downtown.

        This was a routine arcing insulator problem compounded by employee incompetence leading to a death:

        And yeah, this is local trip planning resource:

        To be fair, still WAY safer than driving!

      2. I live near the pentagon and used to take the wmata bus/metro everyday for work. It is that bad. There is even a dedicated twitter account (@unsuckdcmetro detailing the ridiculous failure on a daily basis.

        Rent doesn’t seem too bad at $2k assuming they’re really downtown right near work. pay $1350 for a dumpy 1bd in S.Arlington Virginia. Everything else I agree could be cut easily. But… maybe the food/restaurants they’re eating at are worth $1400/m . Who am I to judge!

  2. 127$ a month!! What the??

    I cut cable 10 years ago… Tough at first, but the savings are well worth it.

    Try an android box… you just need to find a teenager that speaks nerd to set it up for you.

    1. Get any sports… Even cricket! Watched the Leafs lose yesterday in HD.

      The only cost is to your morals and maybe a little to your ethics, but it goes away as soon the Telco’s (bell & Rogers) do their annual increase, while reporting record profits.

  3. $1,452,020.82 in 20 years.


    (1) Your calculation assumes a 6% ROI per year. That is assuming you go 100% equity?
    (The historical average for market return is ~9%, adjusted for inflation, this comes to your 6% figure. Am I correct?)

    (2) Isn’t it a better idea to diversify a bit? Let’s say go with 60% equity, 40% bonds?

    1. 6% is the estimate over the long term I use for a 60/40. Realistically, people with a 15-20 year timeframe should be more aggressive at the beginning, so this is probably on the conservative side of what they could actually get.

  4. Their spending is nuts, as you say, but also to me seems a little underestimated. Nothing for clothes? Their boots never spring leaks? Nothing ever breaks, or wears out, or needs to be repaired or replaced? No gifts? They do mention helping their retired parents, but do they not give gifts to one another or others? And if their consumer spending is so low, then how did they get into credit card debt in the first place?

    1. True, but I wouldn’t call their consumer spending “low.” Anyway, their baseline spending is already so high, that’s where we should focus our efforts to optimize rather than finding more expenses to capture.

      1. My point is that I doubt this is an accurate picture of their yearly spending. I’m guessing that they looked at a month where they happened not to go shopping and multiplied everything by 12. If you’re spending $1200/month eating out, then it’s likely that you’re dropping lots of cash on shiny objects too.

        I do love the case studies, and learn a lot from them. (I was unaware of MVNO cell phone plans, for example, before I started reading case studies on this blog.) But sometimes I wonder about people who cannot use the information on this site to do their own calculations. How hard is it to multiply annual expenses by 25, or to put together a spreadsheet with projected annual savings compounded at a rate of 6%/year? If I, a humanities professor who last studied math when I dropped out of multi-variable calculus in 1994, can do such a thing, then really, anyone ought to be able to. I suspect the harder task is to keep track of spending and to be honest with oneself about how much money is simply evaporating.

  5. Wow, $57,600 in annual expenses. That’s one leaky ship.

    Personally I think the real problem here is their addiction to a high spending lifestyle where expenses aren’t budgeted and controlled.

    They seem to spend based upon what they want (expensive restaurants, sports channels, uber) rather than what they need (good home cooked meals, sports scores & highlights online, and walking/transit).

    Until that little addiction problem gets solved, retirement is going to be more of a dream.

    1. retirement is going to be more of a dream.


      Really ?????

      Hmmm. According to the analysis above, even at that spending level, they could retire by age 45 (!) with $1,452,020.82 in the bank no less.

      1. Wanderer presented a nice table of what it *could* look like if they were able to save consistently for 20 years. But can they really do it? Consistently? 20 years is a LONG time.

        The credit card debt and $1200/month on eating-out makes me think that’s pretty unrealistic.

        Just my personal opinion here, but a Big Spender doesn’t often turn into a Big Saver. It’s an attitude thing about money. Life is more than just a math problem projected 20 years into the future.

  6. Even if the 24 yr old retires early from working a regular cushy day job, there’s still online side hustling. And side hustling still requires work. That is, if anyone wants to be a future “side hustle millionaire.” Am I right? 🙂

  7. To steal a line from Paula Pant “They can have anything they want. They just can’t have everything they want”. They’ll have to decide whether they really want to be financially independent at a young age or whether the high transportation, food, and entertainment costs are worth working an extra 5 or more years for. Compared to a lot of 24 year olds, they’re not doing awful, but they could be doing a lot better while still living a decent lifestyle.

    1. Piggybacking on this since you beat me to the punch:

      Heres my take on what’s really happening:

      1. Entertainment: $20
      2. Cellphones : $150
      3. Cable – $127
      4. Helping Retired Parents: $400
      5. Eating Out: $1775
      – Food places: $1200
      – Transportation/Uber – $575 month
      6. Credit Card – $1000

      Total: $3472

      Base Expenses:
      – Utility Bill: $60 (Average Monthly) [$720/year]
      – Apartment Insurance: $14 [$168/year]
      – Monthly grocery shopping : $320 ($160 X2 month) [$3,840/year]
      – Rent: $2,000

      Total: $2,394

      Total Spending: ~$5900

      You’re attempting to live the lie of “have it all”. The bad news is you can’t have FiRE and maintain this same level on spending. The other side of this coin: You don’t have to FiRE, you can go slower, you can go faster. The best news: Getting your head wrapped around this at 24 w/ decent money potential is almost priceless.

      You need to acknowledge certain things for what they are: Helping Retired Parents out w/ $400/m – Thats straight up lavish charity (whether its parents or donating to PETA is mostly besides the point – your result is about feeling good about yourself/and or having others look on you good). Cell phone service is not a luxury in this day and age, but $150 service absolutely is. Your Uber expenses I place squarely into your Eating Out budget (sneaking suspicion your proximity to downtown makes most of your Uber’s about pleasure as opposed to commuting). Your credit card is likely being used as a catch all luxury expenditure fund (another sneaking suspicion, one honed from personal experience). In a phrase, you acting rich (when you aren’t).

      Immediately, there is hope without noticeable compromise. Some of the trappings of “having it all” can be obtained at lessor cost (e.g. the ESPN suggestions). Do you need ultra super 5G/SUPER LAZER BEAMS Cell service? Unlikely, my contribution is: consider Mintsim (or any other MNVO) – reduce your bill to $30. Perhaps eating out has more frugal options (or not).

      The key take away I have is you need to pick and choose your luxuries/vices. I count 6 “luxury” life style expenses – this is as good as time as any to remind you that as a child your had to choose between horseback riding, gymnastics, or dirt bike racing. The same applies in adulthood. The sooner you do, the sooner you are closer to a sustainable life, not because your life won’t change, but because you can repeat the same exercise to get the life you want when everything has changed (kids, house, grad school, living in Iceland). Hopefully – I don’t rule out the case where this isn’t possible.

      You may also want to consider the level of which you partake in these luxuries: recreational level eating out has a certain minimum cost (especially in DC), but are you taking it to a competitive nearing Olympic level (I’m mildly joking)? The beautiful thing about modern life is the opportunity to actually do that (and not go bankrupt) – but the common trade off you have to adjust every other aspect of your life very low levels (see Tonya Harding’s early life). Most people find they prefer a less extreme balance.

      Some people choose new cars. Other people choose bars and restaurants. Others choose kids. Yet others choose rather nice homes to entertain in. Others choose donating to charity. Each in itself can be achievable, but all in one? It requires extraordinary means or leads to a lifetime of slavery to the money machine.

      Just step off the gas pedal if you find this all is making you miserable. I did. But if you can make it and not be miserable, well then you are what we call a “FiRE blogger”.

      1. Great points and great suggestions. I like the competitive Olympic level eating out line. That’s totally what this is.

        The thing is, I don’t even remember the food in DC being that good. Cheesecake factory, yay?

        1. Next time you’re in DC, challenge accepted! Our Ethiopian and Salvadoran options are second to none (thanks to large immigrant populations); you may also have heard of this Nobel Peace Prize nominee and his armada of amazing restaurants:

        2. It’s not. I’ve lived in DC and travel back regularly. Lot of new places popping up every month, many are good but none are fabulous.

          Most every other city in the world there are a few places I can rave about and recommend highly, I like DC but can’t think off the top of my head any that I would instantly recommend to anybody, let alone spend $1200 a month on.

  8. Like you, my first instinct was to question why they have credit card debt when their savings are triple what the debt is.
    Yeah, if it was me, those cards would be at a zero balance by the end of the day.

  9. I would that in 15 or 20 yrs cost of living adjusted to inflation would lead to a higher amount of capital needed to retire would it not? How can we account for that? Great post as always

  10. They will have to sacrifice something, to get where they want to be, 2000/month rent, have you looked at using your skill sets outside of the city? ( no mention of what they do)

    The whole data package at 60/month kills me, do you really need to check your Facebook page every 10 seconds? I pay $20 a month for a talk and text plan… I check Facebook on my computer.

    Ya the uber thing I don’t get, all citys have public transportation, and many are so bike friendly its actually quicker and cheaper to buy a bike and ride every day.

    1. $2,000 for rent is way too much $ gUaP $. How about $500 a month for a hole in the wall room, and save some money from that and some left over to run PPC ads online to build your business to be a “side hustle millionaire” in the future. 🙂

  11. Some ideas to cut cost. I switched to Corey’s with an Ethernet connection and PlayStation vue. International is $60 a month and His is $45. It cut my bill by $80 a month. His doesn’t need a PlayStation. Cut run from a phone or a laptop or a Tony/fire tv. That simple. Try it, no contracts.

    Also, like someone else said, switch carriers. We have Boost mobile at 40 per person. No contract.

  12. They’re not doing badly for their ages with what they have in the bank if we’re just looking at that. But the spending is huge. My first thoughts while reading this were ‘yikes’ on the eating out spending and ‘awww’ on the helping out retired parents.

  13. Well, I never consider my 401k balance in my net worth. I cannot tap into it until I’m 60 (I know you do some tricks to get it but I don’t).
    I actually don’t even max it out because when I move out of the US back to my home country I plan on paying the penalties and take it with me. That’s why I don’t count with it.
    I prefer to put most of my money in a taxable acct where I can control it even tho I know I’m losing money to IRS but still.
    – 2 grand for rent for convenience it’s really a waste in most cases

  14. What? She lives in downtown DC paying 2k for convenience but at the same time paying almost $600 a month for Uber? Where is the convenience of living there then?

    1. Not having a 2 hour commute twice per day ? lol

      From lot of these silly comments it is pretty evident how many have actually lived in the DC area.

  15. Wanderer: “…the first Reader Case of 2018, we’re gonna pick a doozy”

    Roads?…Where we’re going, we don’t need roads.

    P.S. love the blog

  16. “Annual spending of $46,800 a year means your portfolio target becomes $46,800 x 25 = $1,170,000.” — the problem I see is that this spending is not adjusted for inflation. Since they are going to be at least 15 years in the process, I believe their spending level needs to be increased by 2-3% per year. This means they need to save more. How much more? Well, the amount they can save each year also has to be adjusted for the same inflation, as do their salaries. Using a spreadsheet for all three, I get approximately 22 years using a 6% investment gain and 18 years using a 7% gain.

    1. That’s exactly why it’s always a good idea to start an online side hustle. It allows you to earn that $1m in $ gUaP $ way less than 25 years. Tell me who in their right mind nowadays could live off of a measley $50,000 annually as an employee salary with this government shutdown (before and after)?

    2. Susan @ FI Ideas: You are correct, the increasing living costs due to inflation will require a larger lump sum. I think the idea is that increasing earnings will result in increased savings, countering the effect of inflation. Their actual final FI number may well be 2 to 3 million.

  17. Firstly, awesome for wanting to math the shit up at age of 24. This does not happen a lot, so I think it’s a good one.

    Start early, even with some mistakes along the way and you will get there.
    Secondly, 1500$ per month on food is insane, and the combination of 1200 for eating out and 300 on groceries seem unrealistic. Unless you really don’t eat in any meals?

    First investment to make is to head out for a cooking course. I am not kidding. Its a quality time you both spend together, learn to cook some amazing dishes and it’s a skill that will save you 12k a year. That’s 720k in the next 60 years, taking an average life expectancy into consideration!

    Eating out is amazing and fun, but if we eat out more than once a month, it starts feeling like a chore. Get there, park, choose, order, wait, it all takes time that we could otherwise be using in something different. And the feeling that we could actually cook something better at home for a fraction of the price also helps.

    Try it!

  18. Hi

    I believe that there are other areas in which they may want to cut the expenses. An example might be the expenses incurred from eating out. The amount appears to be on the high side. One possible way is to reduce the visit to the restaurant. I am not sure whether they will be willing to forego such experience of fine dinning.


  19. I lived in the DC area for 13 years as a millennial (single and married). The rent actually seems really reasonable if you want to live in a safe place in the city. Of course there are cheaper places to live in the metro area. Maybe move to Virginia where income taxes are lower than both DC and MD. Arlington is a great place to live. The cost of living there is really high. But … The amount they send eating out is very high. Try to cook more at home and explore restaurants that aren’t that expensive. Even though metro sucks … Take it to lower your Uber bill. Employers are required to subsidize or provide tax benefits for mass transit to get to work so take advantage of that. Also, you may actually need less money if you end up moving to a lower cost of living area when you achieve FIRE.

  20. I live outside DC on the Maryland side, and yes they have areas that they can decrease their spending, but this is one of the most asinine places to live in the country as far as cost of living goes. My wife and I’s budget stands at $53,300 per year, and that’s after over 2 years of cutting it down, down, down (no cable, $40 for cell phone, mortgage utilities and HOA less than 30% of take home pay). That being said, travel is important to us as well so this includes 2 international trips per year and spending pretty much all summer at the beach (where our families live).

    Ironically, DC’s metro doesn’t directly service much of the nicer places to live in the city, something to consider.

  21. Great comments in here! I would add that question to DCMillenialGirl : once retired, will you still be living in a 2000$/month apartment? Will you still need to help your parents in 15 years (is there an american version of our Canadian Guaranteed Income Supplement)? That would change the numbers a bit. A few years could be won there!

    @Wanderer : “And for the first Reader Case of 2018, we’re gonna pick a doozy”… It’s 2019 now! lol 🙂

  22. Glad that these two are starting early!I’m sure lots of other people will give the same advice. Two basic things to cut spending
    1. Eating out budget is insane
    2. Cell phone bill is ridiculous. I pay $35 for a prepaid Verizon plan (no cost tract) That gives me unlimited text and minutes and 3 GB of data (plan is 40 but her 5 off for automatic deduction).
    Good luck!

  23. Good analysis. I think they doing okay for a young couple. They’re bound to make some mistakes. The important thing is that they’re reaching out and learning more about personal finance. The next step is to follow up and optimize their spending. I agree about Uber spending. Why pay so much to live in the city and still spend more on transportation? Seems silly.

  24. I also live right in DC so I totally get how expensive it is to be living here. But part of the reason I decided to move into DC is so that I can walk and bike to places. Your transportation cost seems extremely high… that would be a great place to save money to pay off the debt 🙂 Looking at my expenses for the past month I spent about $30 on Uber/Lyft/Via. If you need a car, there are plenty of car share options as well.

    Also the food and restaurant spending seems pretty high. I also love eating out and there are so many great new restaurants popping up all over DC and a nice meal can easily cost $100+ per person but there are also some really delicious restaurants that don’t break the bank 🙂 Now I did spend about $1,000 in a month on restaurants when I had friends visiting for three weeks straight. We ate out almost every meal and had a blast so I know it’s very easy to over spend – but on the flip side, I bought almost no groceries during that time, which usually runs $75 for two people per week. As I’m sure you know, the Washingtonian puts out the ‘Top 100 Restaurant’ list and one thing that they include is the expected price using $ and ₵ symbols. What I try to do is to hit up places that are on the cheaper end (₵ symbol) in between places that are $$$. Good luck!

  25. Just IMO here but I think nit picking details on a long term saving/investment plans misses much of the point of analysis. Details over 20 years are literally impossible to forecast to the decimal point. The important feature is they now have a general overview of likely trends and endpoints with the ability to change inputs and alter the overall trend of where they’re headed.

    I totally get the desire to plot all this stuff out to the penny but I think there’s a lot of value to the thought a good plan executed perfectly far exceeds the results of a perfect plan executed poorly or not at all.

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