2020-10-18 08:06

An Air Force Vet Needs to Cut Expenses and Debt. Here’s Some Advice. L1W世界播



For Joshua Wright and his family, the immediate financial goals are to reduce monthly expenses and pay off debt. L1W世界播

对于约书亚·赖特(Joshua Wright)和他的家人来说,眼前的财务目标是减少每月的开支,偿还债务L1W世界播

Joshua Wright, a freshman at Kent State University, is not your typical college student. He and his wife, Melissa Wright, live in nearby Rootstown, Ohio, with their three children ages 8, 12 and 14. L1W世界播

肯特州立大学(Kent State University)大一新生约书亚·赖特(Joshua Wright)不是典型的大学生。他和他的妻子梅丽莎·赖特(Melissa Wright)和他们的三个孩子住在俄亥俄州附近的鲁特斯敦(Rootstown),年龄分别为8岁、12岁和14岁。L1W世界播

Mr. Wright is a retired Air Force veteran, 45 years old, and attending Kent State on the GI Bill, which means the military covers 100% of his tuition, provides a stipend for school supplies and pays $1,200 a month toward the Wrights’ living expenses. L1W世界播

赖特现年45岁,是一名退役空军退伍军人,在肯特州立大学参加美国退伍军人法案(GI Bill),这意味着军方支付了他100%的学费,提供学习用品津贴,每月支付1,200美元用于莱特夫妇的生活费。L1W世界播

That is a big help for the couple, whose immediate financial goals are to reduce their monthly expenses and pay off debt. Mr. Wright, who is majoring in applied engineering with a minor in sustainable energy, plans to seek an engineering position at a sustainable energy company when he graduates. While Ms. Wright is currently a stay-at-home mom, she was an accounting manager at a property-management firm before the children were born. L1W世界播


The Wrights were living in Kansas in 2019 when their home flooded. Almost everything was destroyed. They had $35,000 of renters insurance, but that wasn’t enough to cover all expenses, so they made up the difference by using credit cards. L1W世界播


Mr. Wright also receives $1,800 a month in retirement pay from the Air Force and $2,400 a month in veterans disability for an injury incurred while he was in the service. And, even though they now live in Ohio, the couple receives an $800-a-month stipend from the state of Kansas because they adopted two of their children from foster care there. L1W世界播


Mr. Wright bought a home for $230,000 last year, using a 30-year, fixed-rate VA loan at 4.1% that required no down payment. The Wrights have two auto loans: $27,000 and $12,000, with interest rates at 5.3% and 4.9%, respectively. They also have $30,000 in debt spread over 14 credit cards. L1W世界播


The family’s monthly expenses include: $1,429 for the mortgage; $895 for two car payments, plus $150 in car insurance; $770 to service credit-card debts; $400 for groceries; $220 utilities and trash; $185 for cellphone and internet; $100 for kids expenses, $300 eating out, $200 for life insurance and $16 dental insurance. The family’s health insurance is covered by the military. L1W世界播


After paying down their debt, the Wrights would like to continue to reduce monthly expenses and then be in a position to save money for retirement and help their children pay for education. L1W世界播


Advice from a pro: Dan Andrews, a certified financial planner with Financial Planning Fort Collins, in Fort Collins, Colo., says now is a good time for the couple to rethink their approach to their finances. Developing good habits now will help them enormously once Mr. Wright graduates and increases his income, Mr. Andrews says. L1W世界播

来自一位专业人士的建议:丹·安德鲁斯(Dan Andrews)是科罗拉多州柯林斯堡财务规划堡(Financial Planning Fort Collins)的一名注册财务规划师,他说,现在是这对夫妇重新考虑他们的财务方法的好时机。安德鲁斯说,一旦赖特毕业并增加收入,现在养成好习惯将对他们有很大帮助。L1W世界播

First, they need to cut their spending. About 20% of their monthly income is going to car payments, Mr. Andrew says. Replacing the more expensive car with something cheaper, yet equally safe, could save them roughly $300 a month. Next, if they spent $100 a month at restaurants instead of $300 and reduced their cellphone bill by $50, perhaps through a military or student discount, the couple would have an extra $550 a month. That, coupled with the roughly $540 a month they currently have left after expenses, means a surplus of almost $1,100 a month, or more if the Wrights find other ways to save. L1W世界播


Half of that surplus should then be used to build up an emergency fund of about $25,000 for five months of expenses, so they can avoid using credit in an emergency. They should put that money into a high-yield savings account that is separate from their checking account. The other half should go to paying down credit-card debt; they can pay down the card with the highest interest first or consolidate their debt into one payment. Mr. Andrews recommends they look into debt-counseling services through the military or Kent State to help figure out the most efficient way. L1W世界播


Mr. Andrews says it’s important that they pay down as much debt as possible while Mr. Wright is a student, so it becomes a habit, and then substantially increase those payments when he gets a full-time job after graduation. L1W世界播


The couple should also consider part-time jobs for one or both of them. L1W世界播


Good financial habits now will put them in a much stronger position not only to pay down debt, Mr. Andrews says, but also to start planning for other important financial goals, like their own retirement and even helping their children through college, once his income increases. L1W世界播


“He has the discipline, because he is a veteran, and the mind-set, because he is a student, to create new habits and stay on track,” says Mr. Andrews. L1W世界播


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