Episode 53: Balancing Paying Off Debt and Thinking About the Future with Erin Lowry of Broke Millennial

Episode 53: Balancing Paying Off Debt and Thinking About the Future with Erin Lowry of Broke Millennial

Paying off debt is a big (and worthwhile) goal, but what can be done when we have other financial goals we want to be pursuing as well? On this episode we talk with Erin Lowry from Broke Millennial about what it can look like to balance paying down debt while also investing. Theres a lot to consider in this topic, but we’re excited to pick Erin’s brain and share her insight here!

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Notable Notes:

We talked about tips on investing in our episode with Andrew Wang, and now we’re excited to talk about ways to pair this with debt pay-off goals. It may not be for everyone, but we got to ask Erin some questions and received some insightful responses regarding how we can be paying down debt and investing simultaneously. Here’s some of the hightlights:

Questions:

  • There’s a school of thought that you should be entirely consumer debt free before you start investing, others say invest through your debt payoff or at least take the match. You have a really balanced perspective on where someone should be financially to start investing, will you share that checklist with us?

-Goals- identify what it is that you are working towards

-Master you cash flow – basically, budget your money!

-Store up an emergency fund – Erin recommends 3-6 months of bare bones budget, including paying down debt, and setting more money aside for kids and pets

-Pay off consumer debt

  • Should everyone with student loans be investing for retirement?

Basically; it depends. If interest rate on loans are higher than 5% – focus on paying these off. If your interest rate on your student loans is lower than 5% you can think about balancing this with investment.
Also, consider your own debt tolerance in answering this question for yourself!

  • If you decide to invest while you’re paying off student debt, how do you balance the payoff with contributions?

-Face the numbers – ask yourself:

  1. What are the loans?
  2. Who owns the loans?
  3. What’s the interest rate?

-Regarding investment for our self-employed friends:
Aim to put away 35%-45% of your paycheck. This will cover your taxes and leave you with money after you pay your quarterly’s to put into a SEP-IRA, Solo 401k, or other Roth/IRA accounts

  • What do you think about micro-investing apps?

In short; they’re ok – but definitely put in higher amounts than just $1-$2/month. Erin recommends aiming for closer to $25-$50/month to actually see some return on this investment.

BILL OF THE WEEK – Thank you Erin for sharing you bill with us!

Lightning Round

Some final questions for Erin:

  • Favorite personal finance book that’s not your own;)?

Thin Green Line By Paul Sullivan

  • What’s your favorite frugal thing you do?

Go for walks

  • What is your favorite “go-to” easy dinner (at home ;))

Chicken and a can of salsa in the crock pot

  • Where can people find more about you and what do you have coming up at Broke Millennial?

All the platforms!
https://brokemillennial.com/

Frugal Friends Book Club:

It’s April and we’re reading Think and Grow Rich by Napoleon Hill

  • If you want a free copy, leave us a review on iTunes or Stitcher, screenshot the review and send it to frugalfriendspodcast@gmail.com. We’ll select the winners at the end of the month.

Thanks for listening! See you next week!

4 comments on “Episode 53: Balancing Paying Off Debt and Thinking About the Future with Erin Lowry of Broke Millennial
  1. Bonnie says:

    Fantastic podcast! Been looking for suggestions on balancing student loans vs savings/retirement.

    1. frugalfriendspodcast_60w633 says:

      Thanks Bonnie! Glad we could provide some insight!

    1. Eric Sirianni says:

      Thanks for the kind words! Glad you liked it!

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