The Budget of a 33-year old Govt. Auditor Making $79,000 in DC

Being honest, 2015 was a rough year. Lesson learned — never break up with a girl around New Year; you will be paying for it all year. She went into Mad Queen mode.

I ended having to move 4 times.

But like all things, I persisted throughout the process. In gratefulness, I was able to experience different parts of DC on a fast track from Arlington, to Columbia Heights and finally settling on the land beyond the shadows, Largo, MD.

In Columbia Heights, I was able to live the sitcom life. Five bedrooms and two baths shared with a cast that looked like “Captain Planet”. I was the Black guy. On top of that, the Asian girl played the violin. The white guy was a bartender. The other guy was Hispanic and played soccer regularly. Oooh, I almost forgot the white girl loved John Mayer and complained about her job and gentrification (ironic). They were mad cool but we were pretty much modern stereotypes. Think Degrassi.

I ended up stumbling on a Business Insider financial success article online where this family found a place to rent for $500/month (in a city in Utah), budgeted, reduced spending and radically changed their life. They went on to pay down $100k in 2 years. I posted it on Facebook (to my surprise, I found it, click here).

It was obviously… NOT well received.

People were livid. It was as if the article said to murder your baby. It was wild. I’m sure many unfriended me then, just for sharing the article. I argued that it is possible and to my surprise a couple of months later; God rewarded my positivity with a 2/2 rental with a roommate paying $1,100 (aka $550). In the District of Columbia area, that’s a steal.

With that part setup, 2016 was going to be my comeback year. Here’s how my monthly budget broke down:

Avg. Monthly Take-Home: $3,476.78 (Down from $3,825 in 2014)

As always, Uncle Sam wanted his cut of my $78,000. I ended up with $41,721. Thanks, homie, and the oligarchy. I was that close to voting for Bernie (that close). But in truth, I was making sure that I was giving way more to my 401k, IRA, and HSA. Straight Net/Max plan. You might want to check that out. I also started to understand my taxes better. I was learning the ropes of the rich folks.

Rent then Mortgage: $815.76 (Down from $1,025)

So for about 8 months, I was paying $550/month with a roommate in Largo. It worked out and luck would have it, my landlord was selling the other 2/2 condo unit. I grabbed it ASAP for less than $135,000. It wasn’t near the heart of the action but it was right next to a metro. It was another NO BRAINER move. Never blink when opportunity strikes. The mortgage ended up being about $1,030 so the next step with a free room is to get a roommate to split the cost. Voila house hacked.

Cutting the Starbucks Latte (every morning) will save you $100/month but cutting your home down to size can be a Million dollar opportunity.

The crib did flood (upstair’s pipe burst) in November. Yep, things tend to happen (but that’s a story for another time).

Cost of Food and Drinks: $226.59 (Down from $250)

No secrets here. Meal prep. My food tasted better than most alternatives. I still got to go out so I’m guessing credit card points helped reduce that cost. Sn: Brunching too much does cost you in the long run.

Student Loan PMT: $665.52 (Up from $500)

I got on the Public Student Loan Forgiveness program. The trick to beat that game is to realize that your student loan payments go up based on your Adjusted Gross Income. So if you play the game of Tax Avoidance (←- Legal: tax evasion is illegal), you can win for a while as your salary increases. Still better than $750+ a month. I think I managed to pay off two smaller student loans for the win!

Screw you Nelnet!!!

Credit Card PMTs: $509 (Down from $675)

I closed out 2016 with $4.5k worth of credit card debt. Based on the house furniture and items as well as whatever. Basically, money was flowing around and I had to pay it all back. My overall fees and interest were $103.74. Not too shabby coming from $1,758 in 2015 Mad Queen).

Utilities and Phone Bill: $147.27 (Down from $240)

Splitting costs between roommates and that Comcast (first-year deal). I was loving it. But you know the roommate wanted to run the AC 24hr a day. Oooh well, still solid savings.

Savings: $1,358+ (Up from $725)

In the savings dept, I made use of any and all benefits from my reduced rent. 401k increase, IRAs, and even Investments. I was all in. Never looked back. Don’t blink!

Health & Fitness, and Personal Care: $160 (Up from $130)

Getting old so I guess I’m finally figuring out how to take care of myself.

Everything else: About $500+ month

That part is crazy and kinda undefined. I went to Canada and Brazil, traveled for weddings, took Cuban salsa classes, and caught a couple of symphonies. I was budgeting and saving but my quality of life improved. I found out that if you do what is necessary, you will find that life provides what you need.

Total travel costs for 2016 was $6,568.53 so it was not cheap but I covered a lot of ground.

Conclusion

Avg. Monthly Expenses of $2,166.21 (Down from $2,900)

People never realize how much work and struggle you have to put in to be successful. It is non-negotiable. But once set in motion, it’s on auto. I went from -$110,000 in debt to $150,000+ in wealth (that year, I closed the gap by $40k+).

It’s DOABLE and it’s NOT EASY.

Part of life is making the choices that will benefit the greater purpose and actively choosing what you really love over the things you think you are obligated to do. These choices must be timely. As of now, my life is filter-free. Wake up and change.

If you want to follow my finances to fact check, see this link. If this impacts you; share, discuss, and inspire others. Sharing good information matters, like this Million Dollar Life plan.