Oodles of student debt

[VoxPopuli]

Here are the end-of-month numbers for April. The sale of our former principal residence allowed us to retire the RBC LOC ($10,000 at 6.99%) and the vehicle loan ($13,815 at 7.29%). The balance of the sale proceeds went into our TFSA/savings accounts. We're now renting a house for $1000/mo and putting the substantial difference in housing costs into our savings.

Student debt:
Husband Student loan: 25,759.13
Wife Student loan: 19,794.82
Professional student LOC: 58,740.03
= $104,293.98

Credit Cards:
Husband Visa: 194.95
Wife Visa: 300.30
= $495.25

Cash:
Wife High-Interest savings: 2501.28
Husband chequing: 2420.75
Wife chequing: 781.37
= $5703.40

Registered accounts:
RBC TFSA: 20,131.88
RBC RRSP: 14,118.95
Questrade TFSA: 679.27
Scotia TFSA: 25.00
Standard Life RRSP: 18,988.37
= $53,943.47


Net worth, excluding vehicles and household goods:
= -$45,132.46

I keep a detailed spreadsheet of all our balances, and use it to determine our month-to-month net worth change. That spreadsheet is currently on a laptop that may or not be dead, and I'm in the process of recovering the files. Until I get the spreadsheet I don't know our exact net worth change for April, but from memory I believe it's between $2500-$3000. When I get those numbers I'll post the month-over-month changes to the above balances.

That number wil be significantly higher in the upcoming months. April had a few last expenses related to moving and keeping up two properties, and those are now done. Also, I recieved my letter of authority from CRA to decrease my income tax deducted at the source, meaning our take-home pay will be up more than $500/month. If we keep to our spending goals, we should be saving approximately $3000/mo while reducing our debts by approximately $800/mo between now and October, when I'm done articling.

We're still debating what to do about our second car. The registration is up May 9th, so we have to decide fairly quickly. I think the most likely scenario is that we avoid registering it for at least the summer months, then do some of the needed repairs and register it before winter. The repairs will probably eat up $1000-1500 of our savings at some point.

[VoxPopuli]

We socked away a good chunk of money in my TFSA this month, and if the stock markets had been flat we would have achieved our monthly goal of +$3800 in net worth. Unfortunately, the market downswing erased about $2500 between our retirement and TFSA accounts, meaning that overall our net worth only increased $1352.74 on the month.

We've decided not to plate the second vehicle for now. We're trying to squeeze out another couple hundred dollars of savings this month to try and get back on schedule for our down payment savings goals.

The numbers:

Student debt:
Husband Student loan: 25,557.61 (-201.52)
Wife Student loan: 19,601.63 (-193.19)
Professional student LOC: 57,630.32 (-1109.71)
= $102,789.56 (-$1504.42)

Credit Cards:
Husband Visa: 226.88 (+31.93)
Wife Visa: 387.42 (+87.12)
= $614.30 (+$119.05)

Cash:
Wife High-Interest savings: 2503.82 (+2.54)
Husband chequing: 322.44 (-2098.31)
Wife chequing: 1039.98 (+258.61)
= $3866.24 (-$1837.16)

Registered accounts:
RBC TFSA: 19,745.35 (-386.53)
RBC RRSP: 13,026.20 (-1092.75)
Questrade TFSA: 679.27 (no change)
Scotia TFSA: 4500.62 (+4475.62)
Standard Life RRSP: 17,796.56 (-1191.81)
= $55,748.00 (+$1804.53)


Net worth, excluding vehicles and household goods:
= -$43,789.62 (+1352.74)

[Saniokca]

Student debt:
Husband Student loan: 25,557.61 (-201.52)
Wife Student loan: 19,601.63 (-193.19)
Professional student LOC: 57,630.32 (-1109.71)
= $102,789.56 (-$1504.42)

Registered accounts:
RBC TFSA: 19,745.35 (-386.53)
Questrade TFSA: 679.27 (no change)
Scotia TFSA: 4500.62 (+4475.62)

You might have answered it already (and I missed it) but why aren't you taking most of your TFSA money and pay off some of the debt? If you didn't have your TFSA investments, would you borrow 25k to invest in the stock market?

What are the interest rates on these loans/LoCs?

[VoxPopuli]

There are more details are in the first post, but we are saving for a down payment on a house. We will be looking to buy sometime in 2013. By saving up a 20% down payment we avoid CMHC fees, the amount of which dwarfs the interest that would be saved from paying off the loans with the same funds.

The two student loans are at 5.5% (4.675% after the tax credit) and the student line of credit is at 4.25%. All three are variables rates.

[VoxPopuli]

After losing another laptop (and therefore my spreadsheets) it's been a couple of months since I've updated. Since my last monthly update on May 1st, we've been continuing to squirrel money away in savings for an eventual house down payment. Combined with an uptick in our RRSP accounts, we've erased nearly $14,000 of negative net worth in four months.

While it will likely be a year before we buy a house, we're continuing to talk about our down payment plans. It's increasingly likely that we won't attempt to put 20% down (which would mean we couldn't pay down any debt other than continuing our regular monthly payments), but will instead put 10% down and pay down debt with the rest. This would mean we'd only need roughly $50,000 in savings for a down payment,closing costs, and some contingencies. Right now we have a little over $40,000.00 in our TFSAs and cash, meaning after we've saved up another $10,000 or so we'd start paying down debt instead. Nothing set in stone, just a conversation we continue to have. Anyway, here's the numbers:

Student debt:
Wife student loan: 19,013.81
Husband student loan: 25,147.86
Husband professional student line of credit: 56,305.73
= $100,467.40 (-$2,322.20 since May 1st)

Credit Cards:
Husband Mastercard: 285.56
Husband Visa: 127.18
= $412.74 (-$201.56 since May 1st)

Cash:
Wife high-interest savings: 3,008.83
Wife chequing: 2,690.75
Husband chequing: 2,100.12
= $7,799.70 (+$3,933.46 since May 1st)

Registered accounts:
RBC TFSA: 20,200.95
RBC RRSP: 13,782.30
Scotia TFSA: 10,038.11
Standard Life RRSP: 18,528.80
Questrade TFSA: 679.27
= $63,229.43 (+$7,481.43 since May 1st)

Net worth (excluding vehicles and household goods):
-$29,850.97 (+13,938.65 since May 1st)

[Lephturn]

On a technical note - please please back up your work! You can do it for free in the cloud.

Microsoft SkyDrive or Google Drive are completely free for I think 5 Gig or so - I have 25 Gig on SkyDrive because I've had it for so long. You may not be able to back up everything this way for free, but you can at least keep all of your documents in the cloud so if you lose a computer you don't lose all of your hard work.

[VoxPopuli]

Yeah, no question. It's just silly now to lose files to a bum hard drive when there's so many good options available. I use dropbox, but I'll check out the other options you mentioned.

[VoxPopuli]

It's been an expensive month, with lots of unexpected expenses. Some of those expenses will likely carry over into October. We were able to squeeze out just under $2,400.00 of net worth improvement.

Cash:
Actual Cash: 20.00
RBC HIS savings: 3,014.58
RBC chequing: 2,319.15
Scotia chequing: 938.98
= $6,292.71 ($-1,506.99)

Credit Cards
MBNA: 1474.83
Scotia visa: 21.23
= $1,496.06(+$1,083.32)

Student Debt
Wife SL: 18,814.16
Husband SL: 24,734.39
Husband PSLOC: 55,864.95
= $99,413.50 (-$1,053.90)

Registered accounts:
Wife TFSA: 20,496.60
Wife RRSP: 14,313.85
Scotia TFSA: 12,548.75
Standard Life: 19,106.94
Questrade: 679.27
= $67,145.41 (+$3,915.98)

= -$27,471.44 net worth (+$2,379.53)

[VoxPopuli]

As predicted, October was not a strong month, with a number of expenses cropping up. The good news is that my income should be headed significantly higher in the new year, as I switch to a percentage-based compensation system and establish a professional corporation. I'm hopeful that somewhere around April our net worth will cross into positive territory.


Cash:
Cash: 0.00
Uncashed cheques: $2,088.91
RBC HI savings: $3,014.58
RBC chequing: $1,242.11
Scotia chequing: $1,174.81
= $7,520.41 (+$1,227.70)

Registered accounts:
Wife TFSA: $20,538.36
Wife RRSP: $14,388.93
Scotia TFSA: $12,560.94
Standard Life: $19,346.85
Questrade: $679.27
= $67,514.35 (+$368.94)

Credit Cards:
MBNA: $1,414.61
Scotia visa: $26.13
Scotia Visa #2: $1,346.57
= $2,787.31 (+$1,291.25)

Student Debt:
Wife SL: $24,528.08
Husband SL: $18,616.45
Husband PSLOC: $55,396.59
= $98,541.12 (-$872.38)


= -$26,293.67 net worth (+$1,177.77 in October)

[VoxPopuli]

November saw a +$2,343 move for our net worth. This was despite negative months for our RRSPs/TFSAs, and another month of some unusual expenses, like my annual professional dues and insurance. December will of course see higher expenses for Christmas, so it will be interesting to see how the numbers come out.

I recently signed my contract with my employer, bumping up my salary to $60,000 per year plus a quarterly bonus based on my billings. I expect that this will come out to $75k or $80k annually.

With the raise, our net take-home pay is about 7750/mo.

I've been crunching the numbers as my wife and I talk about moving back to our home city, buying a house and having a baby. Moving back home would likely mean a small pay cut for me, and much higher housing costs (at least an additional $1000 or more above what we currently pay per month). A maternity leave would mean reduced income for my wife.

On the one hand I feel like we're nowhere near financially secure enough to be increasing hour housing costs at the same time we're decreasing our incomes, but on the other hand hand we'll both be happier living close to family and friends, especially if we're starting a family. Some tough choices coming up.

Cash:
Cash: 0.00
Uncashed cheques: $2,815.44
RBC HI savings: $4,017.64
RBC chequing: $2,638.33
Scotia chequing: $13,248.20
= $ 22,719.61 (+$15,199.20)

Registered accounts:
Wife TFSA: $20,408.24
Wife RRSP: $14,154.98
Scotia TFSA: $0.00
Standard Life: $19,241.46
Questrade: $679.27
= $54,483.95 (-$13,030.40)

Credit Cards:
MBNA: $1,645.57
Scotia visa: $1,821.43
Scotia Visa #2: $0.00
= $3,467.00 (+$679.69)

Student Debt:
Wife SL: $18,415.01
Husband SL: $24,317.11
Husband PSLOC: $54,954.14
= $97,686.26 (-$854.86)


= -$23,949.70 net worth (+$2,343.97 in November)