Comments on: The post in which I talk about money a lot.

By: Kylene

Kylene — Thu, 13 Aug 2009 23:05:44 +0000

Yes! Keep putting a little bit into the Roth every month and work on the credit card debt. I’ll see if I can find more information for people closer to retirement….

Love you!

By: clbf

clbf — Thu, 13 Aug 2009 22:00:47 +0000

Okay. So I have a couple thousand in a Roth IRA and a thousand in my own savings account, so I’m right on track to be paying of the credit cards now, right?

Chris

By: Kylene

Kylene — Thu, 13 Aug 2009 16:00:35 +0000

Thanks, ladies!!

I really have been spending a lot of time thinking about all these things lately. I have even more thoughts about them that I didn’t write in here yet. Maybe I’ll put up another post about this stuff!

But, yeah. Putting money into savings for a buffer was something that I thought was really important for a while–until the book pointed out the difference in the interest rates. And then I was like, “OH! I’m throwing money away!”

The thing about the Roth IRA, too, is that it can act like that emergency buffer. There are some restrictions on it, but not as tight as others, so if you need to take the money out, you’re able to do that. So once we get things paid off and I’m able to put money into something OTHER than debt, I’m going to start packing money into the retirement accounts as well as savings.

I’m thinking about opening a 2nd Roth in Justin’s name, too. Not right away, of course, but I really want to have a wide diversity in our investing.

Anyway! I hope you’re both doing really well! Love ya!

By: Amy

Amy — Thu, 13 Aug 2009 13:15:02 +0000

Great post. I love Dave Ramsey stuff. He has some of the same ideas. Chris- he says to start out with just $1,000 in savings for an emergency fund and then to prioritize paying off your debt with the “snowball” principle that Kylene mentioned. He doesn’t suggest putting 3-6 in savings until after you’ve paid your debt off. That makes more sense, doesn’t it? You have a little something in case of emergency, but you’re basically just chipping away at your debt for awhile. The cool thing about this is that, once you pay off your debt, you have a certain amount of money each month that you are used to not having access to that you can put directly in savings.
Anyway, sounds great, Kylene. You have a way of inspiring me!

By: clbf

clbf — Thu, 13 Aug 2009 11:59:03 +0000

Awesome post. You are amazingly well-versed on your finances for your age. We didn’t even begin to put money away for retirement until most of you were in college. Kind of late to start, so quite a lot of our money goes to that now, but we couldn’t afford it then (or so we thought…. no, we really couldn’t).

The one thing I’ve never understood is that a lot of financial gurus tell you to first put in savings enough to cover you for 6 months, then begin paying off debt. That never made sense to me, because the chances that you will need that money are actually pretty remote (unless you have a very unsure job), and the interest on the credit cards is piling up meanwhile. As far as paying off the cards, I’m doing the same thing, but I just started with the one with the lowest balance, not the lowest interest, for psychological reasons — I just needed to see one get eliminated soon! I should probably see if I can transfer money from the higher to the lower of the two that are left, but the transfers sometimes cost so much.

Good point about not paying off the school loan — home mortgages are like that, too. They get you a tax break, so might as well carry them the longest. The other one we pay of really slow is medical bills. What are they going to take back?

Credit cards are the real problem. I wish your Dad had half your sense about finances. We could be rich!!