Yakezie.com - Topic: How would you handle my budget? https://yakezie.com/forums/personal-finance/how-would-you-handle-my-budget/ Simple:Press Version 4.5.1 cbhattarai on How would you handle my budget? https://yakezie.com/forums/personal-finance/how-would-you-handle-my-budget/#p64830 Personal Finance & Lifestyle https://yakezie.com/forums/personal-finance/how-would-you-handle-my-budget/#p64830 One of the most basic ting is that ask your husbant to payoff all the Debt before...

]]> Tue, 07 Feb 2012 07:34:27 +0000 PK @ DQYDJ on How would you handle my budget? https://yakezie.com/forums/personal-finance/how-would-you-handle-my-budget/#p63674 Personal Finance & Lifestyle https://yakezie.com/forums/personal-finance/how-would-you-handle-my-budget/#p63674 You're young and $80,000 is a good income - I'm with the others on making the Roth a priority.  The Roth phases out at $169,000 in 2011, so it's possible (likely, even) that one day you won't have that option... plus if you'll be in a higher tax bracket at retirement you'll be happy you put money into the Roth now.

Is your 401(k) capturing the full match?  6% contribution with a 50% match is what it looks like.

I'd leave the mortgage alone.  It's costing you 4.5%*.8 = 3.6% a year after tax benefits (after tax because if you invest in retirement accounts compounding is tax free).

So, for now, leave the mortgage, pile into the retirement accounts... and wait.  I wouldn't worry about the 529s until you were fully contributing to your own retirement.  It's better to make your kids pay for their school than your retirement (if it comes down to that rough choice).

]]> Wed, 01 Feb 2012 07:49:00 +0000 Michelle (Making Sense of Cents) on How would you handle my budget? https://yakezie.com/forums/personal-finance/how-would-you-handle-my-budget/#p63496 Personal Finance & Lifestyle https://yakezie.com/forums/personal-finance/how-would-you-handle-my-budget/#p63496 I would start with the retirement accounts and then the mortgage, purely because of the compounding effect.

]]> Tue, 31 Jan 2012 09:25:52 +0000 AmericanDebtProject on How would you handle my budget? https://yakezie.com/forums/personal-finance/how-would-you-handle-my-budget/#p63418 Personal Finance & Lifestyle https://yakezie.com/forums/personal-finance/how-would-you-handle-my-budget/#p63418 Everyone else pretty much nailed it, but I just wanted to add that the Roth IRA is your opportunity now that will go away when your income reaches a certain maximum. So take advantage of it now!

]]> Tue, 31 Jan 2012 00:14:12 +0000 sensetosave on How would you handle my budget? https://yakezie.com/forums/personal-finance/how-would-you-handle-my-budget/#p63286 Personal Finance & Lifestyle https://yakezie.com/forums/personal-finance/how-would-you-handle-my-budget/#p63286 Jeff-- I think it will be awhile before we make too much for the Roths. If ever. Our 2011 gross is looking like it was a pinch under $80k. 

I think you all are giving good advice on the Roth, since we're only able to contribute $10k per year, and we could access that money if we really really needed to.

It's hard to pull the trigger on that though. I do like the thought of putting some extra toward the mortgage because we are so dang early in the amortization period, it will really add up.

Same with the 529s. Didn't seem like anyone was impressed with the 20% tax credit we'll get on our contributions. To me that is huge!

I'll have to talk some more with my husband about just what we'll do. I wish we could do it all, but we're still a ways off from being able to do that one.

]]> Mon, 30 Jan 2012 14:12:51 +0000 Jeff @ Sustainable Life Blog on How would you handle my budget? https://yakezie.com/forums/personal-finance/how-would-you-handle-my-budget/#p63270 Personal Finance & Lifestyle https://yakezie.com/forums/personal-finance/how-would-you-handle-my-budget/#p63270 I think that a maxed out roth should be a priority as well - though you dont reveal your income situation, you could end up hitting the income cap for IRA's sometime in the future, making you unable to contribute to that account as well.  Also (dont quote me on this) but I think you can use Roths for "qualified education expenses" - not sure if that's just you, or your children as well.  

I'd go for the 529s next, then the home note.

]]> Mon, 30 Jan 2012 12:47:20 +0000 Eric - PersonalProfitability.com on How would you handle my budget? https://yakezie.com/forums/personal-finance/how-would-you-handle-my-budget/#p63250 Personal Finance & Lifestyle https://yakezie.com/forums/personal-finance/how-would-you-handle-my-budget/#p63250 I like some other ideas I have read. Here are my thoughts:

1. Max out the Roth (you are young and will get a longer term benefit from this)

2. Split the difference with the mortgage and the college accounts. If you kids go to private schools without scholarships, you will need up to $320,000 at current cost rates. If you plan to pay for everything, I would put at least enough for in state tuition+fees for Indiana.

]]> Mon, 30 Jan 2012 11:31:22 +0000 Smart Wealth on How would you handle my budget? https://yakezie.com/forums/personal-finance/how-would-you-handle-my-budget/#p63022 Personal Finance & Lifestyle https://yakezie.com/forums/personal-finance/how-would-you-handle-my-budget/#p63022 I agree with the last two posters, retirement first, then 529. 

Looks like you guys have things pretty well together though, it's really great to only have one debt (mortgage) looking forward to hopefully getting there this year.

]]> Sun, 29 Jan 2012 05:15:19 +0000 Daisy on How would you handle my budget? https://yakezie.com/forums/personal-finance/how-would-you-handle-my-budget/#p62997 Personal Finance & Lifestyle https://yakezie.com/forums/personal-finance/how-would-you-handle-my-budget/#p62997 Like retireby40, I would start with the retirement, but then I would pay down the mortgage. Mortgages are pretty heavy on interest and depending on how fast you can pay it down, it could really benefit you in the long run. 

That's my two cents :)

]]> Sat, 28 Jan 2012 15:45:11 +0000 retireby40 on How would you handle my budget? https://yakezie.com/forums/personal-finance/how-would-you-handle-my-budget/#p62920 Personal Finance & Lifestyle https://yakezie.com/forums/personal-finance/how-would-you-handle-my-budget/#p62920 I would increase the retirement contribution first, then 529.

If you have extra money left after that, then pay down mortgage.

In 10 years, the $700 mortgage payment will feel like nothing (inflation.)

]]> Fri, 27 Jan 2012 21:13:51 +0000 sensetosave on How would you handle my budget? https://yakezie.com/forums/personal-finance/how-would-you-handle-my-budget/#p62814 Personal Finance & Lifestyle https://yakezie.com/forums/personal-finance/how-would-you-handle-my-budget/#p62814 My husband and I didn't have student loans, and we're hoping we can help our kids get a start in life like we did. I think that's part of why we're at where we are now -- it's hard to make progress when you have gobs of student loan debt!

We have about $4k to go before we're maxing out both Roths. That might take awhile to get to that point.

]]> Fri, 27 Jan 2012 11:05:55 +0000 Jason@LiveRealNow on How would you handle my budget? https://yakezie.com/forums/personal-finance/how-would-you-handle-my-budget/#p62813 Personal Finance & Lifestyle https://yakezie.com/forums/personal-finance/how-would-you-handle-my-budget/#p62813 sensetosave said:

So contribute nothing at all to the mortgage or college accounts until we're doing $10k/year in the IRAs? Or do you also mean maxing out the 401k too?

I hate to leave money on the table in the form of the tax credit for the college accounts

If you've got it available, I'd max out all of the retirement accounts before either extra mortgage payments or the college fund.    Anything left, I'd split between the mortgage and the college fund, but probably a 70/30 split favoring the mortgage.

It sounds cold, but your kids will have their entire lives to cover their student loans.  It's hard to make up retirement fund contributions.

Also, even if you're not able to help until it's too late to prepay college, you could help with their loans after they have graduated.

]]> Fri, 27 Jan 2012 10:59:54 +0000 sensetosave on How would you handle my budget? https://yakezie.com/forums/personal-finance/how-would-you-handle-my-budget/#p62809 Personal Finance & Lifestyle https://yakezie.com/forums/personal-finance/how-would-you-handle-my-budget/#p62809 So contribute nothing at all to the mortgage or college accounts until we're doing $10k/year in the IRAs? Or do you also mean maxing out the 401k too?

I hate to leave money on the table in the form of the tax credit for the college accounts

]]> Fri, 27 Jan 2012 10:14:42 +0000 Jason@LiveRealNow on How would you handle my budget? https://yakezie.com/forums/personal-finance/how-would-you-handle-my-budget/#p62804 Personal Finance & Lifestyle https://yakezie.com/forums/personal-finance/how-would-you-handle-my-budget/#p62804 I'd max out the retirement accounts, first, mortgage second, college accounts last.   

]]> Fri, 27 Jan 2012 09:58:23 +0000 sensetosave on How would you handle my budget? https://yakezie.com/forums/personal-finance/how-would-you-handle-my-budget/#p62800 Personal Finance & Lifestyle https://yakezie.com/forums/personal-finance/how-would-you-handle-my-budget/#p62800 Oh, I should add that we are not paying PMI, so accelerating the mortgage payoff wouldn't eliminate PMI, as it doesn't exist.

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