How Living at Home Set Me on a Path to Financial Independence

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I graduated back in 2017 and yes, I still live at home. Gasp–the horror! Back in 2017, I graduated with ~$64K in student debt, and my starting pay was a gorgeous salary of $45K. In all practicality, I needed to live at home and I was fortunate to be from a town that is close to the city and actually a pretty great commuter location. 

My first year out of college, I hustled and received a promotion and with that, a nice jump in pay. As soon as I received the bump in compensation, Nick and I had a conversation about whether or not my plan was to move out. Part of me was like, “yes!” I can move out and get my own apartment, but as I sat down to reflect on that potential decision, I would be doing it for all the wrong reasons. 

When I graduated, I made the decision to live at home to contribute more money to my student loans, to create savings, and to also build up savings that would go towards a downpayment for a house one day. 

Each month, I contribute a “rent payment” to my savings and my student loans. My fake rent payment started off as ~$800–since that was realistically what I would be able to set aside, since I still had my regular payments to make. With the new promotion, my fake rent payment would increase which would mean more savings and more progress on my student loan repayment.

As I sat down to crunch the numbers, I realized that if I pursued getting an apartment, I wouldn’t be able to keep up with the additional student loan payments I was making and save. Even more eye opening, when I thought about why I wanted to move out, one of the main factors was that I was feeling pressure from my peers. Candidly, I was starting to feel self-conscious about living at home, since the assumption from many was that I wasn’t doing well financially, so that’s why I thought I had to make the decision. But as I thought about it, each month that I chose to live at home, I was setting myself up for financial success by paying off these loans faster and creating savings. For this reason, I chose to live at home and I am so grateful that I was able to make that decision. 

I realize living at home isn’t an option for everyone, but for me this decision has made all the difference for me financially. I’ve been able to get my student loan balance to ~$24K and create savings for myself. 

Below is a chart that highlights my student loan repayment progress. One note, I selected July 2018 as a marking point since that is when I refinanced my private student loans. As you can see from the chart, I really hit my stride in 2019 and that was largely due to the increase in my base salary and my decision to live at home. Without these two factors, I wouldn’t have been able to contribute as much money to my student loans.

For folks on a path to financial independence, your decisions may not make sense to others whether it be a big decision like living at home or maybe a smaller choice of choosing to stay-in for dinner, but know that these decisions add up (pun intended). As always, make the decisions that feel right to you from a values and financial perspective

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