How much personal financial leverage should you have?
Hi guys,
I just accepted a job in New York FT that pays $85K base. I'm thinking after taxes and rent and everything, I'll probably have about $500 a month for savings. ($4500 after taxes and employer match, $3500 for rent, $500 for random shit). So yearly NOPAT with no bonus would be about $6000.
In PE, a business generally has 5-6x EBITDA leverage. I have $25K in student loan debt so my personal NOPAT leverage would be about 5X. (EBITDA leverage would be probs like 3-4X).
Do you think I'm overlevered? If so, I should pay down my student loans asap.
If you guys think that's not overlevered, should I take my money and invest it or just keep it in cash for B-school etc.? My student loans are at 4%, and S&P earns 8% so if I'm not overlevered it'd be best to invest right?
I know this is a weird way of thinking about it but I'm just curious what you guys think.
Thanks!
banker2018, pure crickets, that's where I come in. Any of these useful?
Hope that helps.
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