A Story About Paying Off Debt and the Obstacles Along the Way

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New Job, New Income, New Benefits

My new job has started! In-person new hire training took place at company headquarters all last week. I came home on Friday. It's Sunday evening. I'm still trying to recover. Who knew job transitions could be so draining?

The upshot is that this post isn't going to be particularly clever or eloquent. 

Still, I wanted to share a little more about the details of my new pay and benefits because they pertain to our finances and our debt repayment plan. If you're uncomfortable with income talk, then this post is probably not for you. I'm putting it all on the table for a couple of reasons: first because I'm a big fan of transparency, and second because it's easier for me to discuss the implications of this job change if I don't have to be coy about the actual numbers.

Here's the rundown of the Big Three (income, health insurance, and retirement):

Income: My new work-from-home income is $58K per year, plus possible bonuses. My previous job paid $35K per year (of course, that was before taxes, health insurance, and a required - required! - 11.5% contribution to my retirement fund... so my actual take-home pay didn't leave much room for things like, you know, paying the rent). Needless to say, the pay bump will have a major effect on our debt repayment. Once I start receiving a biweekly income, we'll be able to increase the amount budgeted for credit cards and student loans from $2200/month to at least $2500/month. 

I was initially planning to devote more of my pay to debt repayment, but then I heard about the company matching for HSA and retirement and realized I couldn't pass up free money. See below.

Health insurance: As I did at the end of last year at my previous job, I chose a high deductible health plan with HSA. Fortysomething still has comprehensive health coverage through his work, so my plan covers myself and The Kiddo. The plan has a $2600 family deductible and a $6500 family out-of-pocket maximum. The health insurance itself, including dental, comes out to about $175/month. I'll also contribute $173/month to my HSA, which my employer will match. Yay matching!

Retirement: My company offers both traditional and Roth 403b retirement plans. I selected the traditional 403b for tax purposes. Regardless of my contribution, my employer automatically contributes the equivalent of 3% of my salary. They offer an additional match of up to 3%, which of course I'll take full advantage of. I plan to contribute $185/month to my retirement fund. (Once we have more of our debt paid off, I'll invest more.) Can you tell that I'm pumped about the matching?

When all is said and done, the pay increase won't affect our budget that much because most of our "extra" earnings will go straight into debt repayment. Lifestyle inflation is not an option. If we stick to our adjusted plan, our credit cards will be paid off by August at the latest... and by the end of May if my tax refund calculations are correct. Then we move on to student loan repayment, which will take another two years (uuuuughhhhh).

Don't get me wrong: this isn't all about money for me. I'm excited about the job and the opportunity to help the people I'll be working with. But I'm also incredibly grateful to be able to ditch this debt more quickly and start getting more on track in the savings department.


  1. Congrats on the raise and on all the matching!!! That's so exciting, as is the fact that you'll have your credit card debt paid off in a few months!

    1. Thank you! I CANNOT WAIT to get those CCs paid off!

  2. Congrats on your new job! appreciated the transparency as well.