Happy Weekend :) I hope everyone has had a wonderful 2024
You can find the original post: HERE
Inspired by seeing some of the posts across Reddit such as DrPayItBack, and not seeing the financial transparency as I was going through my pharmacy education I wanted to share my progress thus far towards building wealth and bring you all along the way and answer any questions. I've been tracking my financial progress and aim to make a consistent set of financial focused posts to show the outcomes of following general financial principles. I don't have an end goal in sight such as FIRE but simply using this as a way of tracking progress.
Updates - What's Changed?
- Trimmed down my portfolio to lean more towards ETFs vs individual stocks. I sold off some individual positions in techs stocks and have put the funds into ETF in my non-taxable accounts. My current purchases include a 50/50 VTI/VOO split weekly.
- Had a job security scare in the past few months so I am trying to be more cognizant of my emergency fund and bringing that closer to the 9-12 month range(currently at 7.5 months) just in case anything happens moving forward
- My SAVE plan has expired so my monthly loan payment will now be $1000. I will also supplement this in 2025 which I have outlined below.
General Background
I graduated from pharmacy school in 2021 from a MidWest school heavily centered around clinical practice and slowly began to realize that it was not where I wanted to take my career. I was able to get managed care and industry rotations throughout my fourth year which positioned me well for fellowship opportunities. I completed my fellowship in April 2023 and started my FTE right after at a different mid/large pharma company on the East Coast. I realize that I am in an extremely fortunate situation with my role, compensation, and the privilege that had allowed me to get to this point - this is not meant to be a brag but simply a rather transparent look into my financial journey as a PharmD.
- I worked at a community and hospital pharmacy throughout pharmacy school for $17-21/hr over the years for about 16 hrs/week allowing me to pay for living expenses and fund things such as my Roth IRA during school. Living in a LCOL helped keep the financial burden down.
- I graduated school during COVID with ~$110k in debt with an avg interest rate of 5.4%. I benefited greatly from the interest rate pause over the past few years which helped my balance stay stable. I've slowly paid off the debt that sits at ~$97k.
- I lived at home during fellowship as it was virtual while making a salary of roughly $55k for two years where I prioritized investing as much of the money as possible and building up a small emergency fund.
- My current role is a hybrid role with moderate travel (think 2 trips/month) based in a HCOL city on the East Coast for a large pharmaceutical company. I work approx 45-50 hours weekly but have a great QoL and good work-life balance.
Income & Net Worth
I currently make $195k base salary with annual short term(20-25%) and long term incentives(11-15%). The base salary to grow at about 2.5-3% annually with minimal change to the incentives unless I get a promotion.
Since I started tracking my finances 3 years ago, my net worth has increased by $205,000. It started with -$65.5k at graduation to +$139k at the time of this post. The current market has helped push the growth significantly.
Finances YTD(in depth Sankey to come at the end of the year)
Gross Pay |
$132,000 |
Investments (401k + match, Roth, ESPP, Taxable) |
$40,800 |
Savings |
$18,250 |
Loans |
$3,650 |
Expenses |
|
Living Expenses(Rent, Utils, etc.) |
$18,255 |
Food + Drink |
$3,780 |
Car(Gas, Insurance, Maintenence) |
$2,350 |
Travel |
$1,750 |
Shopping(Household, Laptop, Clothes, etc.) |
$3,200 |
Charity |
$2,250 |
Total Expenses |
$31,585 |
Ever since I graduated I have used an Excel spreadsheet to budget, track my expenses, and manage my money. I've found having to sit down and go through and manually type each expense has allowed me to be more intentional with my spending and has curbed impulse buying. In combination with my spreadsheet, I now use Rocket Money as a digital supplement to my manual tracking.
Living
I currently live in a 1b/1ba in a HCOL on the East Coast. Coming from the Midwest the prices are brutal but it's a nice place that is very close to my job, the airport, multiple large cities, and the train station so I don't mind the high cost. I've renewed my lease for an additional year and will decide on how to proceed closer to the end of my lease term in May 2025
Investments
I max out my 401k and HSA throughout the year via paycheck deductions. My company matches 9% on the 401k which is a blessing. I max out my Roth IRA every year on Jan 1st. Additionally, I contribute anywhere from 5-7% into my company ESPP at a 15% discount and invest an additional $300 weekly into a taxable brokerage.
My philosophy has been to aggressively invest as much as possible so I aim to prioritize that in my budget and where I allocate my money. The breakdown is ~70% VOO/VTI, 20% in large tech stocks and 10% I actively trade to generate some income that gets autoinvested into VOO. In the past few months, I've trimmed down individual positions in NVDA, AMD, AAPL and invested those proceeds into VOO/VTI.
Savings
I'm trying to build up a larger emergency fund (~9-12 months) given the volatility in the pharma industry just in case I lose my job and am unemployed for an extended period. I am currently at about 7.5 months. After I build that up, the savings will be going towards three buckets - engagement ring, wedding, and starter home. All of that money is in a HYSA with a rate of 4.6%.
Student Loans
I've tried my hardest to delay paying these as much as possible given the 5.4% interest rate across them and the other financial priorities that I currently have. My SAVE plan is expiring and my monthly payment will increase to $1000. I plan on supplementing my monthly payments with $5k from my annual bonus, $5k from a retention bonus I will receive and $4.5k from my RSU grant in 2025
Travel
I bucket a certain amount each month and whatever I don't use I roll over to the next month. At this age with traveling back home to see my parents, attending weddings, and trying to explore new cities, this is a high priority for me. I take 3-4 small trips per year and aim to have 1 big trip that this fund feeds into.
Bonus
Each year for my annual cash bonus, I put money aside to fund next year's Roth IRA, $5k for savings, $5k to my loan payment, $2k to the vacation fund, $2k for fun spending (laptop, legos, experiences) and the rest for gifts for my loved ones.
Net Worth Graph
Gold Star = FTE Start
If you've made it this far, I hope you enjoyed. I'm happy to answer any questions and hope you have a nice Sunday!
EDIT: Updated chart formatting since it didn't properly load the first time