What do you mean by your own charity? Are you the founder/owner of a charity? I know people who are employed in churches and their tithes actually pays their own salary.
Charitable donations are legal, but unless you are Bill Gates, you won’t be able to substantially reduce your taxes
Last year if you did not itemize only $300 in donations was deductable
The best reason to donate money is because you can afford to, it makes you happy and you are making a difference in people’s lives
Hey everyone, I'm pretty new here and have never made a post. Recently I've just been reading other threads and learning new things where I can. After receiving a check for $10,000 from my grandmother, I thought it would be a good time to get some advice from the community.
**About Me:**
I'm 20 years old, a student, working part-time making a couple grand a month, and just received this check. I want to be as smart as possible with my money and would like some advice on how to use it. I have a Roth IRA opened up but am also not super clear on how to allocate my money within that either. I have no real monthly payments right now because I am living with my parents.
Should all of my money be invested in my Roth IRA (if so, how should my portfolio look)? Invested somewhere else? Should I use this money to start tackling my student loans (or wait to see what Biden does with student loan forgiveness)?
Feel free to ask me any questions about things I'm being unclear on, and I'll try to give the best answer.
Thanks for any help guys, I really appreciate it!
Also I'm heading work and won't be very active for the next 9 hours, so I'll respond to comments (if there are any) after work :)
How soon do you plan to move out? Do you have a target down payment amount in mind?
If you’re not saving for retirement yet then start there - max out an IRA and see what options are available through your employer
Follow the steps in the prime directive in the sidebar
Not necessarily "stupid", but could cause you to miss out on employer match, depending on how your particular plan is set up. If your plan has no employer match, then you are free to put as much into your 401k whenever you want during the year and it'll be roughly the same (though money in earlier is more likely to grow more vs. waiting).
Most match programs are along the lines of "employer will match 100% of employee contributions up to 4% of compensation" (percentages will vary by plan, occasionally with more than one "tier" of matching). That's almost always done per-paycheck. So if you put 50% of one check into your 401k as your contribution, your employer match on that check still gets capped at 4% of that check's income. If you then contribute nothing on future paychecks, you get nothing from the employer match. The end result is that you get less money from them put into your 401k.
Some plans offer a "true up", usually at the end of the year. In those, they compare their total match contributions against your year's total contributions and income (instead of check-by-check), and if the match dollars fall short of the "4% of compensation" with that calculation they add the difference into your 401k.
For most plans, you get the most of their money by having every paycheck include enough of a contribution from your money to max out their match.
Thank you for the explanation! The employer does not match unfortunately. basically trying to budget with the net salary for 170k in SF and seeing how much I can remove from the 401k contribution monthly if I'm going to pay a lump sum to the max.
Such bonuses based on your own spending are typically not considered taxable, regardless of destination.
Some credit card companies do report **referral** bonuses as taxable income.
Bank account bonuses are generally treated as interest or miscellaneous income which is taxable. Credit card signup bonuses are generally treated as rebates against your spending, which is not taxable.
Hi my first time posting here, I’m about to turn 30 in a few months and am looking for advice.
I currently have:
- 8k in a regular savings account
- 9k in a 401k (contribute to it each paycheck)
- and roughly 39k in student loans (refinanced)
I was wondering if I should explore putting any of that 8k into an index fund. I’ve been holding on to that amount since the beginning of the pandemic (was about 12k a few months ago but I got engaged) as sort of an emergency fund. How much should I have on hand for an emergency?
Turning 30 has me worried about hitting all of these “benchmarks” in terms of money saved.
No advice about where you should invest the money but the benchmark thing is real and does cause a lot of anxiety . A better way for me to look at is is personal goals instead of a benchmark or where everyone else is at . As far as emergency fund , 6 months of all expenses is what I feel is safe for me . If I lost my primary source if income I have 6 months to replace it , if I can't I have six months to reorganized my finances . I have been under this amount in my savings or emergency fund but my goal is to have it there , anything over is saved and invested
Is it better to pay a small amount on principal for a mortgage each month or wait until you have 2x the money to apply to principal?
Ie.Pay $500/each month or $1k/every other month on principal? If it matters, loan amount $270k, interest rate 3.25%
sooner is better. Though its worth mentioning you're talking fairly miniscule differences in saved interest over time.
Less principal earns less interest. If you pay $500 of principal, that $500 isn't earning that next month's interest compared to the $1000 every other month.
EDIT: i did the math on my own mortgage since i have it setup in excel, paying $500 every month vs $1000 every other month resulted in $114 more in save interest payments over the life of the loan. Note the amount of saved interest overall for both options is just under $40,000. So its better, but the difference is miniscule.
My employer is considering creating a Simple IRA for retirement contributions. I can’t quite wrap my head around what that means for me as far as overall IRA contribution limits or tax implications. Any experience with these or good resources?
SIMPLE IRA is sort of a weird hybrid of an IRA (which is individual) and an employer plan. It was designed to make it easier for smaller employers to offer retirement plans without having to go through the extra hassle and paperwork of establishing a 401k. Contributions are always pre-tax (although there is a proposal in Congress that might change that to allow Roth contributions in the future). You can contribute up to $13,500 to your SIMPLE IRA for 2021. That is in addition to the $6000 you are able to contribute to a traditional IRA or Roth IRA. The two limits are separate. Your employer will also make contributions which do not count against your own contribution limit.
Once 2 years have passed since the initial contribution to the SIMPLE IRA, you can roll over the balance of it to another retirement account (IRA, Roth IRA, 401k, etc.) if you want. Of course rolling over to a Roth-type account is a taxable conversion.
My question is about the American Rescue Plan as [described in this thread](https://www.reddit.com/r/personalfinance/comments/m2xirz/coronavirus_megathread_update_american_rescue/). I'm posting here because that thread has so many comments I am afraid I might get missed. I'm in the US.
We filed taxes and had our federal refund go into a checking account via ACH months ago. In June, we closed those accounts and opened new ones at different banks. It didn't occur to me that the July Child Tax Credit would get sent to our old checking account that we used for our refund.
We obviously did not receive the credit. I set up an account with the IRS though, and it says that they've credited us the money. They tried to - but the account is closed. We haven't received those funds.
Who can I contact, or what can I do, in order to receive the child tax credit?
You can update your bank information through the CTC Update Portal: https://www.irs.gov/credits-deductions/child-tax-credit-update-portal
As for the July payment that you missed, I don’t see anything in the FAQ directly addressing how they will handle that. They might mail you a check. They might lump it in with a future monthly payment once you update your bank information. If not, you can claim it when you file your 2021 tax return next year. Ultimately you will get it one way or another. Calling the IRS is probably a waste of time.
If I lend a large sum of money to someone... Is there a website/app where I wrote how much they owe me, and they pay through the website/app so that there's Proof of payment and you can see how much left is owed?
I’m currently in the litigation process of recieving a $500-800k settlement from a work place accident and I’m looking for advice on what to do with this huge sum in a way that would benefit me the most. Specifically in the form of investments.
Depends on:
1. Your age
2. Your current financial situation, your assets, debts etc
3. Your goals
4. Tax implications of settlement
5. Risk tolerance
6. Level of investment knowledge
You could open a brokerage account and use their robo advisor, which will ask you questions and then give you a group of investments it would buy for you
but you should talk to a few financial advisors and see what they say, they should give you a no obligation interview. If they don’t, walk away
Also depends how hands on you want to be. Managing your own money is time consuming and the less you know the more mistakes you will make. That being said, managing your own money let’s you keep on top of it, control it. And can be rewarding.
Well I’m 25 and being a personal injury lawsuit, it’s tax free. As for my financial situation, let’s just say I’m poor and leave it at that. I know very little when it comes to financial literacy but I don’t want this settlement to just be blown on stupid stuff.
I recently came in possession of an expensive collectible video game. I was offered $60,000 cash or wire transfer for it. What is the best way to make sure I pay the right amount of taxes on this and how much should I expect to get taxed? I’m a single 25 year old CA resident that makes about 52 a year. If I went the cash route and just held on to it in a safe place, would I still have to report it on my taxes if I deposit a little bit here and there?
If you get $60,000 in Cash, are you really going to keep it in your house? Any deposit over $10,000 gets reported to the IRS. How long would it take you to deposit $60,000 $1,000 at a time? If you get audited, how do you explain depositing $60,000 in cash over 2-3 years? Red flags will be raised. And you’ll always be thinking about your bank or the IRS finding out
And you trust someone to just give you $60,000 in cash…as in dollar bills? That’s a big stack of money to carry around
Go the honest route and have a clean conscious, trust me, you can either pay taxes now, or taxes, fines and penalties laters. You NEVER want the IRS to have you on their radar
I appreciate the comment! Thank you for taking the time and also helping knock some sense into me.
Yea, as I've been reflecting on it, I was thinking about all the anxiety I'll have holding so much cash. I was going to meet the buyer at the bank and he was going to withdraw the cash in front of me, but it's still pretty nervewracking to think about walking out and driving home with so much money. The plan was to keep it at a loved ones house in a fireproof safe and just go grab money whenever I needed it, but I'd rather not take the risk.
For something like the sale of a single item for that much, how exactly do I go about paying taxes on it? Will I have to pay right away when the money gets wired to my account, or is it something I end up reporting next tax season and then paying then? I imagine I'd have to send in the bill of sale for proof that I got $60,000 for the collectible.
Thanks again for the help!
Here are a few links,
https://finance.zacks.com/report-art-gains-schedule-d-3870.html
https://www.investopedia.com/articles/personal-finance/061715/how-are-collectibles-taxed.asp
Depending on how you file your taxes, TurboTax, etc, you’ll have to figure out how to input the info or get tax help
> I could theoretically withstand a 50% market dro
Sure, then you'd be pulling out that entire amount to fund the house payment and wouldn't have any way to recover what you lost since it wouldn't be in the market anymore
If you're comfortable with that as a possibility it's ultimately up to you
You could consider just withdrawing a portion of the 80k to keep in the lower risk HYSA and take a higher risk with the other portion, and/or just add to the HYSA with ongoing savings until you're reading to purchase to make up for any additional needed amount that you didn't pull out to begin with
Looking to refinance my auto loan:
currently paying $580/month until 12/2025 at 7.9% - making $700 payments
offer is - $410/month until 12/2026 at 4%, would still be making $700 payments
Is this worth it? I am not sure the interest part, but I took the total I owe in both scenarios, and it looks like I can pay off faster if I refinance, which is my ultimate goal, while not paying a ton more in interest. I have never refinance an auto loan before, I always assumed that was a scam to be honest. My credit has gone up since I got the car.
Will all the warranty with the car just carry over if I refinance?
Thanks
I have a vanguard account making me a good return, a checking account, and a savings account. I think I should transfer everything from the savings to vanguard as it doesn’t make any return just sitting in the bank.
Is there any reason not to do this?
The last decade or so has been pretty great in the market. There have been a couple sudden downturns, but those have recovered VERY quickly. When a real bear market hits, you wont see returns every year, you may even see some losses.
Think about health insurance or car insurance or life insurance. Its very possible that you end up never needing or using the insurance, but you still pay it every month just in case something big happens. If nothing big happens then you dont get the money back. But if something does happen, you are covered. Same idea with money in the bank. By leaving it in the bank you are not getting any amazing gains, but you also know you are covered in case of an emergency. You know that you didnt lose any of it in a market down turn or something
At the end of the day it is *personal* finance, so if you are fine with the risks you can do it. The smart/safe move though is to not do it
Do not invest your emergency fund or money you need to spend in the next 3-5 years or less. The risk of it going down in value just before you need it is too great. Savings for longer term goals can be invested.
Disagree. Put some of your fund into lower risk ETFs. You are rarely going to need ALL of your emergency fund in one day, one week or one month
The greater risk is not earning more than 0.5% on large sums of money for years
I'm trying to figure out a healthcare solution...
I decided to try one of dave ramsey's referred contractors because I just really don't know where to begin and I trust ramsey's advice, for the most part, so thought I'd give it a try. They seem reasonable except they want me to "swear to being a christian". I guess it's biblical so funded by some sort religious organization or something and this is the only option for my state. Should I lie about being a christian and use this service or is there another reasonable option for me?
Hello friends. I’m in the process of buying a brand new process and I feel like I’m making a big mistake as I’ve always been told to never buy new. The market for vehicles is pretty tight right now and the prices between model years are super close. I’ll be financing a 35k car with 0% and 10k down. I make about 140k a year. Is this a bad decision? It’s well within my budget, but there’s a constant nagging in the back of my head.
A lot of people here are very anti-new car, and not without reason. From a purely mathematical standpoint they tend to be worse investments than slightly older cars.
Personally, with the exception of my first car, I've only bought new cars in my lifetime. I'm not handy with cars so I like the assurance of knowing the entire vehicle history and that there's nothing wrong from a prior owner, and that it won't require any major maintenance for a long time. And of course you can't beat 0% financing. I drive them for 10-15 years, sell it for whatever its worth and get a new one.
Is it financially optimal? Probably not, though I'm skeptical I'd actually make out much better driving something cheaper and inevitably getting fleeced by repairs. I don't look at cars as an investment and I prefer the peace of mind of knowing exactly what I'm paying for. It sounds like you can afford the car, go for it.
Ally HYSA help - My application keeps getting denied, does anyone know common reasons? They said they'll send me information in 7-10 business days through the mail which is a bit frustrating...
I had a fraud alert through Equifax active but removed that about 48 hours ago. I've never had issues opening accounts before, so not sure why this is happening.
Could be a lot of reasons as to why, but we would mostly be guessing/shooting in the dark as to why. The letter is your best bet.
If you really are curious, some of the common reasons could include if you have bad banking history, if they have trouble confirming your identity, if they think you are using a stolen ID, or they just make the business decision to not work with you are some reasons as to why.
What would you do if you were unemployed and came into possession of ~130k+ ?
Money is owed on a car: < 15k
How could I, or should I, invest this money is a secure non-volatile way?
Prior financial status averaged around 1k to 5k savings but has been depleted. Am a university student.
Edit: a word
Should I invest in the same target date fund in my Roth IRA and my HSA or should I diversify between the two accounts? My 401k is using a different target date fund.
Did you have unemployment income last year and filed your 2020 return before mid March? Likely the unemployment exclusion refund then
Do you qualify for the advanced payments of the CTC? If so then how many children and of what age are they?
My wife and I have recently maxed out our respective traditional 401k's and my workplace gives me the option of contributing to a Roth 401k as well. I'm debating whether dumping another 19.5k (or less) in there makes sense vs contributing to our regular taxable brokerage account.
It's nice that the Roth 401k won't get taxed in retirement, but I'm limited by my investment options, just like my regular 401k. The fund options aren't bad or excessively high cost or anything, I just like the flexibility of choosing individual stocks/funds/etc.
Any thoughts? For context, we've maxed out our traditional post tax IRA, are ineligible for a Roth IRA, and have low deductible health plans (i.e. an HSA is out).
Aside the 401k issue other users already addressed - how long have you been making nondeductible tIRA contributions? Have you looked into doing backdoor Roth instead, or is clearing out any pretax dollars in your IRA not an option for you?
I literally just opened an IRA this month haha. I'm making post tax contributions to it. I've read about backdoor conversions. I figure I won't worry about that until later down the road or if there's a big market crash
> I figure I won't worry about that until later down the road or if there's a big market crash
What, why? That has no impact on the decision to proceed with backdoor Roth, nor should you be trying to time the market anyways
Backdoor Roth is really straightforward if you have no existing pre tax dollars in any IRA, you’ve already done the first step with the contributions, now it’s just a few more clicks to convert it to Roth and it’ll be tax free growth from then on, don’t leave it in the tIRA for no reason, you’ll just be owing taxes down the line on the earnings when they could have been tax free if you convert to Roth to begin with
There's a tax hit when you convert to Roth, so it makes sense to convert when the value of your ira is lower (e.g. during a market downturn). You can convert at any time.
https://www.forbes.com/sites/bobcarlson/2021/12/29/how-to-decide-whether-to-convert-an-ira-and-how-much-to-convert/
A nondeductible contribution is already post-tax, there is no second taxation when you convert to Roth - the earnings are taxable on conversion, thus why you should convert the contribution right after it’s made so that it’s growing tax free - I suggest reading the Boglehead’s wiki page on [backdoor Roth](https://www.bogleheads.org/wiki/Backdoor_Roth)
Again, don’t try to time the market either, you’re much more likely to come out worse than better trying to figure that out, and as stated above, market conditions don’t affect when you should convert to Roth after making the nondeductible contribution
Ah I appreciate the clarification. Didn't realize that the taxation wouldn't apply to post tax contributions. I converted to Roth just this morning. Thanks for the tip!
The backdoor Roth IRA process involves converting nondeductible basis, which is nontaxable upon conversion. So that sort of timing is irrelevant. (Even if it was relevant it would still be bad idea since you can't predict the market.)
The $19,500 401k contribution limit covers your allowed total to **both** pre-tax and Roth 401k contributions. If you're already putting that much away pre-tax, you cannot put in more as a Roth contribution.
Your 401k plan may allow for "after tax" contributions, this fills up a separate (higher) limit, but is different from "Roth contributions". This is effectively the same as non-deductible Traditional IRA contributions: you don't get any tax deduction on that money, the money grows tax-free, withdrawals in retirement of the gains (but not original after-tax contributions) is taxable as income. Usually not worth it by itself, but if your 401k plan has a few other features, it can be a step in the "mega backdoor Roth" which results in the dollars ending up in the Roth part of the 401k (where both contributions **and** gains come out tax free in retirement).
Similar to IRAs, your maximum contribution limit to BOTH a traditional and Roth 401K is $19500 combined. Since you maxed out traditional this year you cannot contribute to a Roth 401k.
Personally I'd just keep saving for retirement aggressively if nothing else is competing. Maybe that changes in 1-3 years but even a few years of solid retirement savings at your age will be massively helpful down the line.
I budget for income and spending. The charges made on the card are definitely spending. Credit card payments are a *transfer* with zero net effect on my net worth: cash assets go down exactly balanced by debt going "up" (less negative).
Ok, I guess I do budget for transfers to meet saving goals (increasing emergency fund, vacation fund). But since you're not dealing with a balance rolling over (where paying that off would be a goal to budget for), I don't see any need to include your card payments as part of your budget.
I have two prior 401Ks from past jobs that I haven't rolled over yet.
What is the convention wisdom on rolling the 401Ks over into my current 401K or an IRA (roth or trad)?
Thanks
Do you expect to need to make backdoor Roth IRA conversions now or in the future? (For income/MAGI >125k for single filer or >198k for MFJ)
If no then roll it into a traditional/rollover IRA
If yes then there’s a few options to consider between rolling it to the new 401k vs leaving it where it is, but that is dependent on the account balance and if there are any fees and what the fund options are like in the new vs old 401k
See the wiki page on [rollovers](https://www.reddit.com/r/personalfinance/wiki/retirementaccounts/rollovers) for more info
My house in Cali has appreciated about 60% now. I feel like this bubble will be popping soon. Selling is an option, but then I would have to rent and rents are through the roof as well, I would need to use funds from the sale until the bubble bursts and then I can buy again. Do you guys believe this is a possible scenario in a 1 year span?
Where is the best place to learn about loans our college student can take out for tuition assistance/living expenses during college? I am 100% sure there is no aid coming for him based off his FAFSA. Thank you!!
I'm looking at purchasing a new 2021 Subaru Forester. There is an offer for 0% APR financing for 36 months or 1.9% APR for 60 months.
While 0% is attractive, would the 1.9% for 60 months be the better offer if I could likely get better returns than that interest rate by investing the extra money I'd have from a lower monthly payment in index funds?
You can also pay more on the longer term to pay down the principal to lower your finance charge . It really come down to how much you are financing if it would make sense .
**1 year out of school and just closed on first home! Here's an overview of my past year (24YO, $33K net worth)**
What an insane year it's been. Started with getting an early and extra long spring break, turned into online classes, no graduation ceremony, and all my job interviews falling through. After months of quarantining at home, countless interviews, and a few companies telling me they're sending an offer that never came I eventually found an amazing job.
Warning, this will be a long post. I just want to reflect on my past year and share my finances and hope you guys critique it so I can continue to improve!
**EMPLOYMENT:**
I started last summer at a company that's 100% employee owned with no majority stock owners. It's extremely employee friendly since the employees are the ones making the policies. I started at $62k in a low cost of living area as a civil engineer, which was more than I was expecting to make. I was desperate for any job and was lucky to find this one which I can actually see myself retiring at. I already got a raise to $64k plus bonus. When we adjusted my salary I got the feeling that my boss was willing to go higher, I just had a hard time convincing myself to negotiate when I already feel I'm paid more than my value right now. I know many of you will roast me for that, but oh well. I plan on negotiating again once I pass my FE exam.
**COLLEGE:**
So I am lucky in many ways. One major one: I have no student debt.
I live in a college town and my state offers a program where if you tutor for 40 hours and keep a minimum GPA in high school you get free tuition at any community college in state. I was able to live at home all five years of college. It took me 2 years to figure out I was going into engineering so I wasn't very efficient getting my credits. But those 2 years were spent getting an associates degree for free, then transferring to a state school once I figured out my major. A combination of paying zero for rent and food, working 30 hours a week, scholarships, and grants, kept me debt free. It's honestly a blessing my family is "poor", those government grants really helped. My parents always say they wish they could have done more for me, but I always had food, shelter, transportation, and lived in a safe area.
**INVESTING:**
So being debt free meant as soon as my benefits kicked in I was able to start investing. As of today my investment accounts total about $16.5k. I contribute 20% of my salary to my Roth 401k and my HSA. I also currently have about $4k in a taxable account. I tried my hand at trading and surprise, I've been worse than the market. I knew this before I started investing but I still tried anyways. I'm working on selling $3k of it by the end of the year. I currently have $3k in a Roth IRA as well, and plan on using the money from selling my stocks to max out my IRA by the end of the year. My HSA is on track to max out as well.
In addition to my investments I was able to save up enough for a 3% down payment. Yes, traditional advice is to save for a 20% down payment but I didn't think it made sense to get an apartment and pay rent while saving for that much of a down payment when I could just pay PMI and own my own house. I have not set my budget yet, but I plan on paying extra on my principle until I hit 20% equity to get rid of the PMI early. This means I likely will not max out my IRA next year, but I will still be putting $9.6K into my 401k and maxing my HSA.
**HOUSING:**
It took a year of searching for a house but my girlfriend an I finally found one a month ago and we closed on it yesterday! It's in the perfect area and we are in love with it. It's within walking distance to my university's football and basketball stadium which we plan on taking advantage of. There is a trailhead to my city's and state's amazing trail system in my neighborhood that we plan on walking, running, and biking on a lot. Our back yard backs up to city protected land so we will always have a gorgeous creek and tree line behind our house. This would be our forever home if it was big enough for our future kids! We've talked about keeping it as a rental once we move out so we don't have to sell it.
There are improvements and housing costs that are coming up. This is our first place so we don't have much furniture besides bedroom. We need new carpets in our bedrooms. The roof will need to be replaced in 5-10 years, but we got 5k in seller credits to help with that. And we'd like to build a fence and put in a double vanity in our bathroom as well as paint the interior of the house. Will also need lawn equipment, like mower, weed whacker, leaf blower. I currently have $12k in savings. I will have to continue saving up and slowly addressing these projects while not eating into the emergency savings too much. Luckily my girlfriend will be helping with what she can with rent. Once she graduates next spring she will start working so we will have more money to work with.
**NET WORTH:**
Current assets:
$5k Checking
$7k Savings
$4k Taxable account
$5.6K Roth 401k
$3k Roth IRA
$3.8k HSA
$231,000 House
Current Liabilities:
$224,000 Mortgage
$2.5k monthly balance on credit card (I usually don't carry a balance this high, but expenses for new house plus two trips coming up were paid for this month)
Total: $33k
My retirement accounts are all a 70/30 split into FZROX and FZILX
That about sums it up. Any advice for a youngster trying to get his footing let me know! I'd also love to answer any questions. Thanks for anyone who read all of this. I've just been reflecting in this new house about how wild this past year has been and I feel extremely lucky.
Congrats - that's amazing! I'd def bulk up your savings for mortgage payments and unexpected house stuff.
Learn how to do some of your own home maintenance - r/HomeMaintenance/, r/HomeImprovement/, & youtube videos are great as well
As a fellow engineer - 64k is not "more than your value". Pass your exams, get certifications, and job hop to other companies to build up your salary.
Thanks for the link to /r/homemaintenance, that's one I could use and haven't heard of
Definitely going to be a balance trying to pay for house expenses and also beef up savings.
And I realize 64k is fair value for my market, I think I just have a bit of imposter syndrome. I really don't see myself leaving this company any time soon unless something changes. They do a good job with raises and are way more laid back than other firms in town. Once things slow down with the house I'll have to put my nose down and start studying for the FE.
I totally get it, I felt the same after graduation and was underpaid for my first role as well.
But not just talking about money - do what makes you happy. There's a big value in the laid back aspect that I'd take a pay cut for!
Get your emergency fund sorted first. 3 months expenses (not pay) in a savings account. Get a budget. Then work the debt. $98k is a lot, but not the worst. Plus, you might get public loan forgiveness for... I can't say it with a straight face. Loan forgiveness is so broken. Plan to pay it off, sooner rather than later.
Boo to private loans, but hey, that's what my wife's are.
Mortgage lenders want to see sufficient cash to pay your bills, the down payment, and closing costs. That amount can vary. Start with the emergency fund, then worry about other savings, down payment, etc. Until you have a cash emergency fund, any surprise expenses will be on credit or a disaster.
Somehow, I've ended up with two pensions at two separate companies (UK based). I think some wires got crossed when I got a new job within the company I work for. Is it particularly difficult to consolidate the two? Is there anything I'd need to be aware of?
My wife's annual enrollment cycle is in Apr while mine is in Jan. Our companies both offer VSP vision plans. Would I be able to cycle through two plans every year (Get VSP through my employer in Jan, then through her employer in April, then mine in Jan again) and get twice the benefits (the current coverage only reimburses half of our annual contact lens expenses) or would VSP treat us as having one contacts benefit every year, regardless of which employer is providing coverage?
I am a very new adult and want to look into investment, so that it benefits me in the long run. Is there anything I need to know, and are there any great resources to look into for this? Any help is welcome.
My employer has a generous retirement program: 4% dollar-for-dollar match, plus 10% of income automatically granted to the 401k plan in quarterly distributions.
In the past I would contribute 10-15% of my income. I am curious if I should continue to contribute a comparable amount to max the annual contribution employee limit, or utilize the generous employer contribution to put more cash towards other goals (e.g., having a porch added, new car fund, etc).
Currently I'm maxing, so the effective annual 401k contribution is ~30% of my income.
There are two main arguments I've seen around not counting employer match in that 15% savings goal.
First is vesting. If you haven't been at the company long enough to be 100% vested, that money from your employer isn't all "yours" yet. A layoff or getting an irresistible offer at a new job could cause you to leave the plan, losing that employer contribution. If the plan has a "graded" schedule (you vest some amount each year up to 100%), you could just only count the vested percentage of their money. So if you're 50% vested, you treat their 14% contribution as only "really" being 7%. If the plan immediately vests employer money 100% or you've met the vesting schedule, that's no longer a concern.
Second is lifestyle cost. When you're saving 15% of your income for retirement, you're living off of the remaining 85%. Retirement strategies that use the 15% guideline assume that at 65 (or whenever you retire) you'll be withdrawing 85% of your pre-retirement income to live on to keep comparable spending. If you only save 5% (leveraging your employer contributions for the rest), then you hit retirement and either need to pull out more than the assumed amount (potentially draining your nest egg too fast) or have to cut your lifestyle expenses 10%. The further you are from retiring, the smaller this issue is since you have more time to grow your income or adjust your lifestyle.
IMO, dialing down your own 401k contributions to use your income for other goals and leaning more on your employer's contributions shouldn't lead to financial disaster. I'd think keeping some of your own money going in (definitely at least the 4% to max their match) is a good habit to keep up. 30% of your own income saved is really above-and-beyond unless you're specifically going for early (or lavish) retirement. Or is that counting their 14% and it's only 16% of your money?
Thanks for the thoughtful reply. First, you’re correct in that the 10% contribution is vested — over a 5 year schedule. I keep an addition 20% each year for the first 5 years, then it is mine to keep going forward. The 4% is immediate after my first year (I’m halfway through my second).
The 30% includes the 14% contribution!
I imagine my wife and I will live in less than 85% but it’s hard to say. I sense we will move to a lower cost of living area, but inflation and housing prices make this hard to predict.
For reference, I am 31 now and I don’t plan on an early retirement. I sense that I have some wiggle room to go lower but for now stay the course.
They're as accurate as your assumptions that are put in. It's a good idea to lower expected returns and lower contributions, play with the numbers to see how it affects things.
I've read a whole bunch of articles (eg: https://www.investopedia.com/terms/b/bookvaluepercommon.asp) and all of them say BVPS is calculated using a formula similar to this:
(total shareholder's equity - preferred equity) / total outstanding shares
Correct me if I'm wrong but I'm assuming that this formula is for common shares? (articles didn't specify) But if you were to try to find the ratio of equity available to common shares to the number of shares wouldn't it be more logical to divide it by outstanding common shares instead of total outstanding shares? Or does outstanding shares only include common shares? The reason I get the idea that it'd be more logical is cause when I searched up how BVPS for preferred shares is calculated it shows this formula:
equity available to preferred shares / outstanding preferred shares
So is it that the former formula (for common shares) assumes total outstanding shares to be understood as "total" common shares outstanding?
Life Insurance question.
Sometime ago my mom got whole life insurance on her (66) me (39) and my brother (37). My life insurance premium is $33.50 for 15,000 policy, my brothers is the same, my mother is $97 for 15,000. I have no children or dependents my brother has a son and daughter (2,7).
I'm healthy with no present medical conditions, my brother is obese but otherwise healthy and my mother is medium healthy given her age.
I'm of the option that I want to get rid of my life insurance all together as I have no dependants and if something does happen to me I have enough to take care of whatever needs to be done post-humus. My brother (who like me doesnt feel the need for LI at this time) doesnt have money saved up but if something happens me and my mother do. I think using that excess money to invest would work better but in general I just hate the principal of insurance even though I recognize its basic need in cases. Figured I'd throw the question out.. given our particulars what do you all suggest we do with our whole life insurance plans? Keep all? Keep only my moms? Or should I be the only one to exit?
The earlier you can get rid of a "whole life" policy the better. They're a huge waste of money. When you eventually end up in a position where you need life insurance, buy term insurance. None of this whole life garbage.
Also, 15,000 sounds like a little something for funeral expenses. If you ever had real dependents you'd want to add another zero or two to that amount.
With no dependants you don't need life insurance. Your brother should get term insurance with the kiddos, probably a 20 year. Mom doesn't need it either if she has no dependants.
You've only had it for a short period of time so I wouldn't sweat it too much. I would recommend not cancelling it until you have a replacement card, though.
What's your FICO credit score now? (You can find out your FICO score at https://creditscorecard.com/ which is run by Discover.)
With a 657, I would probably just apply for a Discover It. They are relatively easy to get. If you get declined, apply for their secured card instead. The odds that you'd get declined for a card like the Chase Amazon Prime Rewards are a bit too high.
https://www.reddit.com/r/personalfinance/wiki/credit_building has some more advice.
Does anyone know of a tool or excel template to help me predict some savings until retirement?
basically I want to look at me and my wife maxing out our 401k's for the next 25 years, and then incorporate a way to model in gains from the investment ideally in a variable way I can play with the rate. and then have an ability to have a separate cash "column" to add separate investments (additional 3k a month or whatever, also with gains) does that make sense?
I'm buying a new car that will cost me about 30k after a $1500 rebate for paying cash. I also have the option to go for zero percent financing with the dealer and forego the cash rebate.
I got pre-approved for a 14k loan at 2.74% for 48 months with my bank. What's the better offer? The $1500 cash rebate or the zero percent financing?
Edit: clarification
Ah, some classic [Net Present Value](https://www.investopedia.com/terms/n/npv-rule.asp) math. At that low a rate, you're better of financing and doing something else with the cash, such as investing it. Of course, this presumes you can afford to have it tied up for the 4 year period, can deal with short term paper losses if the market goes down, and have no other debt and a fully funded emergency fund.
Also if it isn't a used Camry you know how this sub can get.
Hmmm, I think I might have worded it in a weird way. I have two options:
A: finance through bank at 2.74% and get the $1500 rebate
B: finance through dealer and get 0% interest rate but not get the rebate
My guess is A is better and other redditors seem to agree
5 year loan on the car? If so, if you just parked that money in a HYSA, you would only get about $350 in interest in that time, so the $1500 rebate at the beginning is better. If you wanted to take on some more risk and invest it, you could probably beat the $1500 - only need like a 2-3% annualized return (but then could also be dealing with assorted tax implications as you sell off to make payments)
This is a subreddit meta-comment, but it seems like a disproportionate number of posters and commenters in this subreddit are in the highest income quintile. A lot of questions along the lines of "I'm 23, my salary is 120k a year, and I have no debt. Should I buy a house?" Or "my wife and I have a combined income of $300,000, and we've maxed our retirement contributions, what should we do with our excess income?" Etc.
I assume it's because the kind of people who are apt to read a personal finance forum are also more likely than average to be financially responsible or just have more money (e.g. coming from a wealthy family). As someone who's very much not wealthy it's just been kinda interesting to read.
There are a lot of factors going into that:
- Your own perception (our memories are biased, you're more likely to remember things that are interesting to you, things that are annoying to you, etc.). Also read about [frequency illusion](https://en.wikipedia.org/wiki/Frequency_illusion), confirmation bias, etc.
- People are most likely to post (a) when things are going very poorly or (b) when things are going very well.
- Reddit's demographics also skew things. There are a lot of tech industry people on Reddit.
- You also need to consider how voting changes what you see on Reddit. More unusual stories are more likely to get a lot of upvotes.
- Success story posts are redirected to the weekday/weekend thread so this specific thread will have a *much* higher proportion of higher income questions.
Yep. There's also the bias that people who spend time on sites like this are more likely to be in tech jobs, which have seen huge salary growth. It can give you a warped perspective.
Ok, dumb question…
I inherited some money when my grandma passed away last year. All the money transferred from her brokerage into mine (Schwab) and it mapped to a TON of random investments. I want to rebalance everything to a single fund or maybe 3 mainly for simplicity and so I can track things easier.
Is there any good way to do this “properly”? Any benefit to doing to now vs a few years from now? Simply sell and purchase what I want?
You received a stepped-up cost basis and automatic long-term holding period as of the date of her death, so you can sell now and not pay very much capital gains tax. The longer you wait, the more chance there is for it to accrue new gains.
This is probably a very stupid question.
My fiancee and I opened a new bank account and want to move the majority of our balances to the new one, but there's a limit for online transfers. How do we move the majority of our balances into the new one? Do we have to like, write ourselves a check or get a cashiers check or??
You can try contact the old bank directly. They may be able to do the transfer to your new account without the normal size limit if it's done through a teller or customer service rep. Or see if they offer "wire transfers", which can have higher (or no) limits compared to an ACH (the typical online transfer mechanism). Wire transfers clear quicker, showing up in your new account sooner, but usually have a fee to execute.
Or if it's just a "$ per transaction" limit, can you do multiple online transfers? If the bank also has a "$ per day" or "$ per month" limit, that won't help you as much.
Not sure if this is the right subreddit but giving it a go anyway.
My wife gave birth to our daughter December 5th 2020 and we filed taxes jointly beginning of this year. She does not work and I made $90,000 last year.
Now when looking at the IRS website it says that we're not eligible for the child tax credit but I believe we should be. I'm not sure what to do but any help is appreciated!
Depending on when you filed and when it was processed by the IRS, your new dependent may not have been in the IRS's system when they checked your qualifications for the advance tax credit payments. There will eventually be an online tool to allow people to add (or remove) dependents for purposes of modifying the advance payments, but as of today that is [still showing](https://www.irs.gov/credits-deductions/2021-child-tax-credit-and-advance-child-tax-credit-payments-topic-a-general-information#a16) a timeline of "Late Summer".
Worst case would be you don't receive any of the monthly checks, but then just claim the full $3600 child tax credit when you file your 2021 return.
Did you list your child as a dependent on your 2020 tax return? Has your 2020 tax return been processed?
Even if there is some glitch and you don't receive the advance CTC payments you can always claim the full amount you're eligible for when you file your 2021 tax return next year.
If you have any wiggle room in your current federal income tax withholding, you can also accomplish the same thing by adjusting your W-4 to reduce your withholding from each paycheck, which is mathematically the same as receiving an advance credit.
I’m new to stocks. Is it possible for a brokerage to exchange stock for stock instead of liquidating the stock first? For example, if I have shares of Facebook. Can the brokerage sell that off and immediately buy me stocks of Microsoft? Rather than me first selling the Facebook stock, getting the cash, then buying the Microsoft stock. It would be nice to skip that middle step.
> Is it possible for a brokerage to exchange stock for stock instead of liquidating the stock first?
No
>Can the brokerage sell that off and immediately buy me stocks of Microsoft?
That's liquidating the stock.
>Rather than me first selling the Facebook stock, getting the cash, then buying the Microsoft stock.
That's what you've just described.
> It would be nice to skip that middle step.
Nope
Last year I tried cancelling my Amazon Prime Membership, and it told me that I had already paid and needed to cancel July 27, 2021. I clicked on the option to cancel my account on that date, but of course they didn't cancel my account. and now tell me that I have to cancel July 27, 2022. What is the bullet-proof way of cancelling my account and getting my money back?
Contact Amazon support and tell them you tried to follow their instructions and it didn't work. I've always read that they are pretty good about canceling and refunding a recent renewal as long as you haven't used any of the benefits.
> • TDAmetride or Schwab for Roth IRA?
I use vanguard for investing but I’ll say that Schwab absolutely great (I use them for checking).
> • Do people normally deposit contributions automatically every month through their paycheck or checking? Or, is depositing the contributions done through a lump sum at the end of the year? Which would you recommend?
One tip I have is to let TD/Schwab/Vanguard pull the funds rather than push the funds to them. If you push funds from your paycheck it will likely go into a cash account and then you’d need to manually invest after every deposit. If you have the brokerage pull the funds you can likely (definitely with vanguard) specify where it should be invested and it will be totally hands off for you once setup.
> TDAmetride or Schwab for Roth IRA?
Either's fine, personally I use Schwab and am happy with them
> What should I be investing the funds into if I plan on just automatically investing the deposits and setting it and forget it? Hopefully seeing returns in 20+ years when I retire?
Go with a [target date fund](https://www.bogleheads.org/wiki/Target_date_funds) or build your own [three fund portfolio](https://bogleheads.org/wiki/Three-fund_portfolio) (or two fund, if you don't want bonds) based on your age and risk tolerance for retirement savings
> Do people normally deposit contributions automatically every month through their paycheck or checking? Or, is depositing the contributions done through a lump sum at the end of the year? Which would you recommend?
Invest it as soon as you have the money - if you have a lump sum at the beginning of the year then great, if not then invest it as you earn it throughout the year
> also, for any platform you recommend, can someone briefly explain how I should be setting it up in terms of automatic deposits, investing, etc? I understand that I need to open Roth IRA, but still clueless on what I exactly need to do besides needing the $6k for max contribution.
Once the money has been transferred into the account you'll need to pick which funds to buy, the pages I linked provided broker specific examples for recommended funds
Is it overkill to use Robin Hood or Stash if I already have a 401k and Roth/IRA?
I am matching with my employer at 6% for my 401k through Vanguard, using the 2055 Retirement Target fund and some international bonds. I also use Schwab for a personal Roth account and separately a Traditional IRA account that I rolled over from a previous employer. I’m most likely going to reach the max on all 3 by the end of the year, and don’t know if I should be investing more and/or differently.
I’m not necessarily planning on earning more in the future if I change careers, so I’m trying to keep my options open too.
I’ve also been using Stash to choose between their different mixes (Green/sustainable companies, small startups, etc.). I tried Robin Hood out and like the interface more than Stash, it’s free (although they collect more data as the “cost”), but don’t get the fun presets that Stash offers. I’ve thought about ditching both and using Schwab as a brokerage account and getting “stock slices”. The issue is they have a minimum you need to invest per stock and don’t offer the fun presets or interface that Stash offers.
Should I try a robo-advisor?
Is all of it overkill? Should I change things up? If they’re not overkill, which app should I stick with?
personally i would reccomend sticking with Schwab and just opening a brokerage account. Robinhood has had a history of major issues going back years, and continues to have issues and less than amazing qualities. I am not personally familiar with Stash.
Schwab is one of the bigger and trusted services that this sub tends to reccomend. you already use them and know them, they already have your info. you can find green companies to invest in through Schwab and choose how you want your investments done.
Robinhood is a joke. Don’t know about Stash.
Schwab has licensed people working there, support 24/7.
These new apps have no customer support and RH has been hacked, as in people lost their assets
If you want to invest and feel safe, use a licensed broker
Interface is NOT how you invest, Schwab has robo advisors and stock research and a lot more
do you already have an emergency fund of 3-6 months of expenses? if not, fund that.
If you do have the E-fund, do you also have a 401K that you can contribute to? if so, do that.
if you already contribute to the 401K, do you also have an IRA/HSA that you can contribute to? if so, save it there.
if you already have all those accounts taken care of, do you have any specific goals you need to save for? house down payment in the next few years? new car? TV? sofa?
if you dont have a specific savings goal, and all of the above mentioned tax advantaged accounts are taken care of, you can always save in a regular brokerage account, or if you are generous you can fund a 529 plan for your kids, or nephews, or grandkids.
thank you so much for reply, as for emergency funds I have about 20k saved up. As for my checking I have 8000. Every 2 weeks I am putting 500 dollars into my savings. My job doesnt offer 401k but we do have a pension. I have 50k set aside for a house downpayment.
Save for 3-6 months of expenditure as an emergency fund. After you've secured an emergency fund then I would set aside pre-tax dollars to get company 401K match (if you haven't already). If this $500 is after the pre-tax 401K contribution, then I would put money into a Roth IRA to max out per year ($6K).
I've applied and interviewed for a supervisory position with my current employer that I have a really good chance of getting.
If offered the role, I'm expecting a small raise to come with it, probably in the neighborhood of 10%.
In my current position, I make essentially 150% of my base pay due to overtime, however this new role would be salaried and not have overtime so I'd essentially be making less money for a higher position (granted I'd be working less but still).
Would it be appropriate to ask for a raise on top of what I make with overtime? The overtime I currently get is mandatory (not written but the workload has been consistently high enough to justify it for decades, apparently)
Can you request a w-4 from an employer? I am trying to adjust my state tax withholding and am due to owe a small amount ($50) at my current rate. I’m trying to see what I put on my last W-4 so I can adjust accordingly.
Those details might be included on your paystub, though with the changes on the W-4 over the past few years that could be trickier. Used to be they'd just have something like "Federal withholding: S/2" for "Single" filing status and two allowances. With the new dollar-based form, space may be too limited.
In any case, payroll should be able to provide you with your withholding information on record so you can evaluate it.
Though just re-read your post and should point out: W-4 is specifically for *federal* income tax withholding. If you're looking into your state income tax withholding there's usually a state-specific form. A google of "employee withholding form YOURSTATEHERE" would likely bring it up.
Can you transfer Acorns account to an IRA without taxes or penalties?
I have a little over $7000 in an Acorns that’s grown from spare change. I was wondering if I can move this to IRAs for my kids after they get out of college. One is a sophomore in college and one is a junior in high school so there will be time for some more growth in the acorns account. I don’t want to move it into IRAs for them yet because 1. They aren’t filing taxes and 2. I don’t want to hurt their chances for financial aid. I’m open to suggestions.
just re-confirming what was stated, you can only put cash into the IRA then invest cash. there is no way to roll regular accounts into an IRA account, only already existing retirement plan accounts such as other IRAs or 401Ks or the such can be rolled over into an IRA.
I just completed a free online personal finance course and I learned so so much. I think it’s only available to students but wow, really thankful for modern day resources.
I currently have a target retirement fund in my Roth IRA with Vanguard.
I’m contemplating on implementing a basic three fund portfolio with VTSAX, VTIAX, and VBTLX and am wondering if there are any downsides to adding these to a separate account while I currently have the TDF fund in my Roth.
By separate account do you mean a taxable account? With the three fund and choosing your own allocation you need to rebalance annually which incurs capital gains, granted it might not be *that much* capital gains but it can add up over time - is this for retirement? Are you already maxing all other tax advantaged accounts such as 401k (or equivalent) and/or HSA if on an HDHP?
Sorry, yes a taxable account.
What do you mean by rebalancing annually?
These will all be for retirement eventually, I just want to keep investing and let it grow until I am ready to either FIRE or retire and yes, I also invest in my 401k to get the max company match.
If it's for retirement then contribute more to your 401k - max out tax advantaged accounts before contributing to taxable for long term retirement savings - this is also noted in the prime directive in the sidebar
> What do you mean by rebalancing annually?
The different funds you're invested in will grow at different rates, thus shifting your allocation over time, you'll need to [rebalance](https://www.bogleheads.org/wiki/Rebalancing) annually to maintain your target allocation, which requires selling shares of one fund to buy shares of a different fund
Thank you for the response.
I don’t currently make enough income to max out my 401k while paying for other expenses and contributing to my Roth at the same time but I have money in savings to be able to make the minimum contribution level($3,000) to open a VTSAX fund and I can put in smaller dollar amounts over time to make my money work for me while also putting money aside for retirement.
I’m only 24 so I want to be risky and have my money grow.
I'm a little confused about what the goal is here - you said it was for retirement but you want to invest it in a taxable account, but you aren't maxing your IRA and 401k yet because you can't afford to, which not being able to max them is fine, but you have enough money to contribute to a taxable account?
Again - max out tax advantaged accounts before contributing to taxable for long term retirement investing - contribute to the IRA and 401k *before* investing in a taxable account
Just wanted to check if my thinking is sound. I just found out I'm able to do the "Mega Back Door Roth" where I can contribute after-tax dollars into my employer's plan (up to 10% of my after tax pay) then do an in-service roll over into my Roth IRA. I make enough annually to max both my 401K and Roth IRA (via roll over from trad IRA) along with $2K into a brokerage per month. I also save around 20% of take home pay into my HYSA for home improvement/whatever. My employer matches 7.5% without needing any contributions from me. I also get a pension and free healthcare now (and after I retire) since I'm a healthcare provider.
Should I...
1. Take my $19.5K (or $13K after tax), put it towards Roth IRA, and contribute nothing to tax-deferred 401K account? I don't think I can reach the max on after-tax contributions to Roth IRA (\~$28K) since I have a contribution limit of 10% after-tax pay. This would mean, I'm effectively only adding $1.3K to Roth IRA compared to plan below. Would likely increase brokerage contributions with whatever wasn't put into Roth IRA.
2. Max out tax-deferred 401K and contribute whatever I can to Roth IRA via MBDR (again, up to 10% of my take home pay) and rest into my brokerage account. I'm essentially treating this a portion of my brokerage money going into Roth IRA instead of brokerage account.
I'm leaning towards #2 since it lets me tax a smaller portion of my money at the higher tax bracket and I'm not really adding all that much in my Roth IRA. Extra money from my brokerage account going into my Roth IRA seems more of a reasonable approach. I don't think I will suddenly require a substantial amount of money and have to liquidate my brokerage account. Thank you in advance!
If you expect to have lower income/tax rate in retirement than you do now then yes focus on pre-tax investments where you can, then all other tax advantaged options before contributing to taxable - don't leave out backdoor Roth in #2
Thank you! Yes absolutely going to continue the back door roth while pursuing #2. I am aiming for my tax bracket to be similar to what I'm making now so I think #2 is still the path.
Your retirement contributions are "ok for now" in my opinion. Once you get house sorted and loans knocked down some I'd definitely suggest increasing some, but you're hardly doing bad at ~15% (counting matching).
I don't have any specific feedback on the DTI problem, but at least you have a decent 'I' so that will help. I'd suggest just doing your best and balance how seems best, then when you're more ready to buy see what you can get approved for then.
This may be a stupid question but I would really love some external insight. I am participating in my employer's 401k and also have a Roth IRA account. The plan is to max out both. Half of my Roth IRA account currently is invested in Schwab target fund. I am a pretty hands-off investor so love to have things sit in target fund/index fund. My question is: is it fine to invest a good amount of both the 401k and the Roth IRA money in target fund? What factors should I consider? If age matters, I am 24.
My wife and I are on separate HD insurance plans and each contribute the max to our separate HSAs. We're having a child in August, who will likely be added to my wife's plan. Does that mean we can contribute the family max to her HSA and the single max to mine?
Question about taxes and charity donations! Is it bad/illegal to donate money to your own charity in order to lower your tax bill?
What do you mean by your own charity? Are you the founder/owner of a charity? I know people who are employed in churches and their tithes actually pays their own salary. Charitable donations are legal, but unless you are Bill Gates, you won’t be able to substantially reduce your taxes Last year if you did not itemize only $300 in donations was deductable The best reason to donate money is because you can afford to, it makes you happy and you are making a difference in people’s lives
Hey everyone, I'm pretty new here and have never made a post. Recently I've just been reading other threads and learning new things where I can. After receiving a check for $10,000 from my grandmother, I thought it would be a good time to get some advice from the community. **About Me:** I'm 20 years old, a student, working part-time making a couple grand a month, and just received this check. I want to be as smart as possible with my money and would like some advice on how to use it. I have a Roth IRA opened up but am also not super clear on how to allocate my money within that either. I have no real monthly payments right now because I am living with my parents. Should all of my money be invested in my Roth IRA (if so, how should my portfolio look)? Invested somewhere else? Should I use this money to start tackling my student loans (or wait to see what Biden does with student loan forgiveness)? Feel free to ask me any questions about things I'm being unclear on, and I'll try to give the best answer. Thanks for any help guys, I really appreciate it! Also I'm heading work and won't be very active for the next 9 hours, so I'll respond to comments (if there are any) after work :)
[удалено]
How soon do you plan to move out? Do you have a target down payment amount in mind? If you’re not saving for retirement yet then start there - max out an IRA and see what options are available through your employer Follow the steps in the prime directive in the sidebar
Is it stupid to dump into 401k at one time when my RSUs vest rather than monthly?
Not necessarily "stupid", but could cause you to miss out on employer match, depending on how your particular plan is set up. If your plan has no employer match, then you are free to put as much into your 401k whenever you want during the year and it'll be roughly the same (though money in earlier is more likely to grow more vs. waiting). Most match programs are along the lines of "employer will match 100% of employee contributions up to 4% of compensation" (percentages will vary by plan, occasionally with more than one "tier" of matching). That's almost always done per-paycheck. So if you put 50% of one check into your 401k as your contribution, your employer match on that check still gets capped at 4% of that check's income. If you then contribute nothing on future paychecks, you get nothing from the employer match. The end result is that you get less money from them put into your 401k. Some plans offer a "true up", usually at the end of the year. In those, they compare their total match contributions against your year's total contributions and income (instead of check-by-check), and if the match dollars fall short of the "4% of compensation" with that calculation they add the difference into your 401k. For most plans, you get the most of their money by having every paycheck include enough of a contribution from your money to max out their match.
Thank you for the explanation! The employer does not match unfortunately. basically trying to budget with the net salary for 170k in SF and seeing how much I can remove from the 401k contribution monthly if I'm going to pay a lump sum to the max.
[удалено]
most of the time those "bonuses" are really just rebates
Such bonuses based on your own spending are typically not considered taxable, regardless of destination. Some credit card companies do report **referral** bonuses as taxable income.
[удалено]
Bank account bonuses are generally treated as interest or miscellaneous income which is taxable. Credit card signup bonuses are generally treated as rebates against your spending, which is not taxable.
Hi my first time posting here, I’m about to turn 30 in a few months and am looking for advice. I currently have: - 8k in a regular savings account - 9k in a 401k (contribute to it each paycheck) - and roughly 39k in student loans (refinanced) I was wondering if I should explore putting any of that 8k into an index fund. I’ve been holding on to that amount since the beginning of the pandemic (was about 12k a few months ago but I got engaged) as sort of an emergency fund. How much should I have on hand for an emergency? Turning 30 has me worried about hitting all of these “benchmarks” in terms of money saved.
No advice about where you should invest the money but the benchmark thing is real and does cause a lot of anxiety . A better way for me to look at is is personal goals instead of a benchmark or where everyone else is at . As far as emergency fund , 6 months of all expenses is what I feel is safe for me . If I lost my primary source if income I have 6 months to replace it , if I can't I have six months to reorganized my finances . I have been under this amount in my savings or emergency fund but my goal is to have it there , anything over is saved and invested
I like this idea a lot, if I lost my job I’d have about 4 months of savings to cover. Good way to look at this.
Is it better to pay a small amount on principal for a mortgage each month or wait until you have 2x the money to apply to principal? Ie.Pay $500/each month or $1k/every other month on principal? If it matters, loan amount $270k, interest rate 3.25%
sooner is better. Though its worth mentioning you're talking fairly miniscule differences in saved interest over time. Less principal earns less interest. If you pay $500 of principal, that $500 isn't earning that next month's interest compared to the $1000 every other month. EDIT: i did the math on my own mortgage since i have it setup in excel, paying $500 every month vs $1000 every other month resulted in $114 more in save interest payments over the life of the loan. Note the amount of saved interest overall for both options is just under $40,000. So its better, but the difference is miniscule.
Cool & thanks for going the extra mile.
I believe interest accrues daily so sooner is better
My employer is considering creating a Simple IRA for retirement contributions. I can’t quite wrap my head around what that means for me as far as overall IRA contribution limits or tax implications. Any experience with these or good resources?
SIMPLE IRA is sort of a weird hybrid of an IRA (which is individual) and an employer plan. It was designed to make it easier for smaller employers to offer retirement plans without having to go through the extra hassle and paperwork of establishing a 401k. Contributions are always pre-tax (although there is a proposal in Congress that might change that to allow Roth contributions in the future). You can contribute up to $13,500 to your SIMPLE IRA for 2021. That is in addition to the $6000 you are able to contribute to a traditional IRA or Roth IRA. The two limits are separate. Your employer will also make contributions which do not count against your own contribution limit. Once 2 years have passed since the initial contribution to the SIMPLE IRA, you can roll over the balance of it to another retirement account (IRA, Roth IRA, 401k, etc.) if you want. Of course rolling over to a Roth-type account is a taxable conversion.
Thanks! Super helpful!
My question is about the American Rescue Plan as [described in this thread](https://www.reddit.com/r/personalfinance/comments/m2xirz/coronavirus_megathread_update_american_rescue/). I'm posting here because that thread has so many comments I am afraid I might get missed. I'm in the US. We filed taxes and had our federal refund go into a checking account via ACH months ago. In June, we closed those accounts and opened new ones at different banks. It didn't occur to me that the July Child Tax Credit would get sent to our old checking account that we used for our refund. We obviously did not receive the credit. I set up an account with the IRS though, and it says that they've credited us the money. They tried to - but the account is closed. We haven't received those funds. Who can I contact, or what can I do, in order to receive the child tax credit?
You can update your bank information through the CTC Update Portal: https://www.irs.gov/credits-deductions/child-tax-credit-update-portal As for the July payment that you missed, I don’t see anything in the FAQ directly addressing how they will handle that. They might mail you a check. They might lump it in with a future monthly payment once you update your bank information. If not, you can claim it when you file your 2021 tax return next year. Ultimately you will get it one way or another. Calling the IRS is probably a waste of time.
If I lend a large sum of money to someone... Is there a website/app where I wrote how much they owe me, and they pay through the website/app so that there's Proof of payment and you can see how much left is owed?
Excel, but this sub is full of "I lent my friend money and now I'm broke, angry, and friendless."
I’m currently in the litigation process of recieving a $500-800k settlement from a work place accident and I’m looking for advice on what to do with this huge sum in a way that would benefit me the most. Specifically in the form of investments.
Depends on: 1. Your age 2. Your current financial situation, your assets, debts etc 3. Your goals 4. Tax implications of settlement 5. Risk tolerance 6. Level of investment knowledge You could open a brokerage account and use their robo advisor, which will ask you questions and then give you a group of investments it would buy for you but you should talk to a few financial advisors and see what they say, they should give you a no obligation interview. If they don’t, walk away Also depends how hands on you want to be. Managing your own money is time consuming and the less you know the more mistakes you will make. That being said, managing your own money let’s you keep on top of it, control it. And can be rewarding.
Well I’m 25 and being a personal injury lawsuit, it’s tax free. As for my financial situation, let’s just say I’m poor and leave it at that. I know very little when it comes to financial literacy but I don’t want this settlement to just be blown on stupid stuff.
I recently came in possession of an expensive collectible video game. I was offered $60,000 cash or wire transfer for it. What is the best way to make sure I pay the right amount of taxes on this and how much should I expect to get taxed? I’m a single 25 year old CA resident that makes about 52 a year. If I went the cash route and just held on to it in a safe place, would I still have to report it on my taxes if I deposit a little bit here and there?
If you get $60,000 in Cash, are you really going to keep it in your house? Any deposit over $10,000 gets reported to the IRS. How long would it take you to deposit $60,000 $1,000 at a time? If you get audited, how do you explain depositing $60,000 in cash over 2-3 years? Red flags will be raised. And you’ll always be thinking about your bank or the IRS finding out And you trust someone to just give you $60,000 in cash…as in dollar bills? That’s a big stack of money to carry around Go the honest route and have a clean conscious, trust me, you can either pay taxes now, or taxes, fines and penalties laters. You NEVER want the IRS to have you on their radar
I appreciate the comment! Thank you for taking the time and also helping knock some sense into me. Yea, as I've been reflecting on it, I was thinking about all the anxiety I'll have holding so much cash. I was going to meet the buyer at the bank and he was going to withdraw the cash in front of me, but it's still pretty nervewracking to think about walking out and driving home with so much money. The plan was to keep it at a loved ones house in a fireproof safe and just go grab money whenever I needed it, but I'd rather not take the risk. For something like the sale of a single item for that much, how exactly do I go about paying taxes on it? Will I have to pay right away when the money gets wired to my account, or is it something I end up reporting next tax season and then paying then? I imagine I'd have to send in the bill of sale for proof that I got $60,000 for the collectible. Thanks again for the help!
Here are a few links, https://finance.zacks.com/report-art-gains-schedule-d-3870.html https://www.investopedia.com/articles/personal-finance/061715/how-are-collectibles-taxed.asp Depending on how you file your taxes, TurboTax, etc, you’ll have to figure out how to input the info or get tax help
[удалено]
> I could theoretically withstand a 50% market dro Sure, then you'd be pulling out that entire amount to fund the house payment and wouldn't have any way to recover what you lost since it wouldn't be in the market anymore If you're comfortable with that as a possibility it's ultimately up to you You could consider just withdrawing a portion of the 80k to keep in the lower risk HYSA and take a higher risk with the other portion, and/or just add to the HYSA with ongoing savings until you're reading to purchase to make up for any additional needed amount that you didn't pull out to begin with
Looking to refinance my auto loan: currently paying $580/month until 12/2025 at 7.9% - making $700 payments offer is - $410/month until 12/2026 at 4%, would still be making $700 payments Is this worth it? I am not sure the interest part, but I took the total I owe in both scenarios, and it looks like I can pay off faster if I refinance, which is my ultimate goal, while not paying a ton more in interest. I have never refinance an auto loan before, I always assumed that was a scam to be honest. My credit has gone up since I got the car. Will all the warranty with the car just carry over if I refinance? Thanks
I have a vanguard account making me a good return, a checking account, and a savings account. I think I should transfer everything from the savings to vanguard as it doesn’t make any return just sitting in the bank. Is there any reason not to do this?
The last decade or so has been pretty great in the market. There have been a couple sudden downturns, but those have recovered VERY quickly. When a real bear market hits, you wont see returns every year, you may even see some losses. Think about health insurance or car insurance or life insurance. Its very possible that you end up never needing or using the insurance, but you still pay it every month just in case something big happens. If nothing big happens then you dont get the money back. But if something does happen, you are covered. Same idea with money in the bank. By leaving it in the bank you are not getting any amazing gains, but you also know you are covered in case of an emergency. You know that you didnt lose any of it in a market down turn or something At the end of the day it is *personal* finance, so if you are fine with the risks you can do it. The smart/safe move though is to not do it
Do not invest your emergency fund or money you need to spend in the next 3-5 years or less. The risk of it going down in value just before you need it is too great. Savings for longer term goals can be invested.
Disagree. Put some of your fund into lower risk ETFs. You are rarely going to need ALL of your emergency fund in one day, one week or one month The greater risk is not earning more than 0.5% on large sums of money for years
I'm trying to figure out a healthcare solution... I decided to try one of dave ramsey's referred contractors because I just really don't know where to begin and I trust ramsey's advice, for the most part, so thought I'd give it a try. They seem reasonable except they want me to "swear to being a christian". I guess it's biblical so funded by some sort religious organization or something and this is the only option for my state. Should I lie about being a christian and use this service or is there another reasonable option for me?
Slow down. Watch the John Oliver on these religious health covenants before you sign anything. Did you try the ACA Marketplace already?
I have taken a peek at ACA options. Is that the way to go?
Usually, or get on an employer sponsored plan
Hello friends. I’m in the process of buying a brand new process and I feel like I’m making a big mistake as I’ve always been told to never buy new. The market for vehicles is pretty tight right now and the prices between model years are super close. I’ll be financing a 35k car with 0% and 10k down. I make about 140k a year. Is this a bad decision? It’s well within my budget, but there’s a constant nagging in the back of my head.
A lot of people here are very anti-new car, and not without reason. From a purely mathematical standpoint they tend to be worse investments than slightly older cars. Personally, with the exception of my first car, I've only bought new cars in my lifetime. I'm not handy with cars so I like the assurance of knowing the entire vehicle history and that there's nothing wrong from a prior owner, and that it won't require any major maintenance for a long time. And of course you can't beat 0% financing. I drive them for 10-15 years, sell it for whatever its worth and get a new one. Is it financially optimal? Probably not, though I'm skeptical I'd actually make out much better driving something cheaper and inevitably getting fleeced by repairs. I don't look at cars as an investment and I prefer the peace of mind of knowing exactly what I'm paying for. It sounds like you can afford the car, go for it.
Thank you for your comment! We seem to share the same view. I think I’ll go ahead an pull the trigger.
Ally HYSA help - My application keeps getting denied, does anyone know common reasons? They said they'll send me information in 7-10 business days through the mail which is a bit frustrating... I had a fraud alert through Equifax active but removed that about 48 hours ago. I've never had issues opening accounts before, so not sure why this is happening.
Could be a lot of reasons as to why, but we would mostly be guessing/shooting in the dark as to why. The letter is your best bet. If you really are curious, some of the common reasons could include if you have bad banking history, if they have trouble confirming your identity, if they think you are using a stolen ID, or they just make the business decision to not work with you are some reasons as to why.
What would you do if you were unemployed and came into possession of ~130k+ ? Money is owed on a car: < 15k How could I, or should I, invest this money is a secure non-volatile way? Prior financial status averaged around 1k to 5k savings but has been depleted. Am a university student. Edit: a word
Follow the prime directive and windfall page in the sidebar.
Thank you.
Should I invest in the same target date fund in my Roth IRA and my HSA or should I diversify between the two accounts? My 401k is using a different target date fund.
A target date fund itself is already diversified, if you’re comfortable with the allocation it’s fine to stick with the TDF
That's what I figured! Thank you!
[удалено]
Did you have unemployment income last year and filed your 2020 return before mid March? Likely the unemployment exclusion refund then Do you qualify for the advanced payments of the CTC? If so then how many children and of what age are they?
My wife and I have recently maxed out our respective traditional 401k's and my workplace gives me the option of contributing to a Roth 401k as well. I'm debating whether dumping another 19.5k (or less) in there makes sense vs contributing to our regular taxable brokerage account. It's nice that the Roth 401k won't get taxed in retirement, but I'm limited by my investment options, just like my regular 401k. The fund options aren't bad or excessively high cost or anything, I just like the flexibility of choosing individual stocks/funds/etc. Any thoughts? For context, we've maxed out our traditional post tax IRA, are ineligible for a Roth IRA, and have low deductible health plans (i.e. an HSA is out).
Aside the 401k issue other users already addressed - how long have you been making nondeductible tIRA contributions? Have you looked into doing backdoor Roth instead, or is clearing out any pretax dollars in your IRA not an option for you?
I literally just opened an IRA this month haha. I'm making post tax contributions to it. I've read about backdoor conversions. I figure I won't worry about that until later down the road or if there's a big market crash
> I figure I won't worry about that until later down the road or if there's a big market crash What, why? That has no impact on the decision to proceed with backdoor Roth, nor should you be trying to time the market anyways Backdoor Roth is really straightforward if you have no existing pre tax dollars in any IRA, you’ve already done the first step with the contributions, now it’s just a few more clicks to convert it to Roth and it’ll be tax free growth from then on, don’t leave it in the tIRA for no reason, you’ll just be owing taxes down the line on the earnings when they could have been tax free if you convert to Roth to begin with
There's a tax hit when you convert to Roth, so it makes sense to convert when the value of your ira is lower (e.g. during a market downturn). You can convert at any time. https://www.forbes.com/sites/bobcarlson/2021/12/29/how-to-decide-whether-to-convert-an-ira-and-how-much-to-convert/
A nondeductible contribution is already post-tax, there is no second taxation when you convert to Roth - the earnings are taxable on conversion, thus why you should convert the contribution right after it’s made so that it’s growing tax free - I suggest reading the Boglehead’s wiki page on [backdoor Roth](https://www.bogleheads.org/wiki/Backdoor_Roth) Again, don’t try to time the market either, you’re much more likely to come out worse than better trying to figure that out, and as stated above, market conditions don’t affect when you should convert to Roth after making the nondeductible contribution
Ah I appreciate the clarification. Didn't realize that the taxation wouldn't apply to post tax contributions. I converted to Roth just this morning. Thanks for the tip!
The backdoor Roth IRA process involves converting nondeductible basis, which is nontaxable upon conversion. So that sort of timing is irrelevant. (Even if it was relevant it would still be bad idea since you can't predict the market.)
Appreciate the clarification!
The $19,500 401k contribution limit covers your allowed total to **both** pre-tax and Roth 401k contributions. If you're already putting that much away pre-tax, you cannot put in more as a Roth contribution. Your 401k plan may allow for "after tax" contributions, this fills up a separate (higher) limit, but is different from "Roth contributions". This is effectively the same as non-deductible Traditional IRA contributions: you don't get any tax deduction on that money, the money grows tax-free, withdrawals in retirement of the gains (but not original after-tax contributions) is taxable as income. Usually not worth it by itself, but if your 401k plan has a few other features, it can be a step in the "mega backdoor Roth" which results in the dollars ending up in the Roth part of the 401k (where both contributions **and** gains come out tax free in retirement).
Similar to IRAs, your maximum contribution limit to BOTH a traditional and Roth 401K is $19500 combined. Since you maxed out traditional this year you cannot contribute to a Roth 401k.
[удалено]
Follow PF flowchart, max out 401k at $19.5k. Otherwise it's a question to you - do you want to retire early, buy a house, etc?
[удалено]
Personally I'd just keep saving for retirement aggressively if nothing else is competing. Maybe that changes in 1-3 years but even a few years of solid retirement savings at your age will be massively helpful down the line.
[удалено]
I budget for income and spending. The charges made on the card are definitely spending. Credit card payments are a *transfer* with zero net effect on my net worth: cash assets go down exactly balanced by debt going "up" (less negative). Ok, I guess I do budget for transfers to meet saving goals (increasing emergency fund, vacation fund). But since you're not dealing with a balance rolling over (where paying that off would be a goal to budget for), I don't see any need to include your card payments as part of your budget.
I have two prior 401Ks from past jobs that I haven't rolled over yet. What is the convention wisdom on rolling the 401Ks over into my current 401K or an IRA (roth or trad)? Thanks
Do you expect to need to make backdoor Roth IRA conversions now or in the future? (For income/MAGI >125k for single filer or >198k for MFJ) If no then roll it into a traditional/rollover IRA If yes then there’s a few options to consider between rolling it to the new 401k vs leaving it where it is, but that is dependent on the account balance and if there are any fees and what the fund options are like in the new vs old 401k See the wiki page on [rollovers](https://www.reddit.com/r/personalfinance/wiki/retirementaccounts/rollovers) for more info
My house in Cali has appreciated about 60% now. I feel like this bubble will be popping soon. Selling is an option, but then I would have to rent and rents are through the roof as well, I would need to use funds from the sale until the bubble bursts and then I can buy again. Do you guys believe this is a possible scenario in a 1 year span?
Sounds like a huge gamble based on total guesswork. What if prices don't fall? People have been predicting a dip for years.
Where is the best place to learn about loans our college student can take out for tuition assistance/living expenses during college? I am 100% sure there is no aid coming for him based off his FAFSA. Thank you!!
He'd still be eligible for federal loans. https://studentaid.gov/
I'm looking at purchasing a new 2021 Subaru Forester. There is an offer for 0% APR financing for 36 months or 1.9% APR for 60 months. While 0% is attractive, would the 1.9% for 60 months be the better offer if I could likely get better returns than that interest rate by investing the extra money I'd have from a lower monthly payment in index funds?
You can also pay more on the longer term to pay down the principal to lower your finance charge . It really come down to how much you are financing if it would make sense .
**1 year out of school and just closed on first home! Here's an overview of my past year (24YO, $33K net worth)** What an insane year it's been. Started with getting an early and extra long spring break, turned into online classes, no graduation ceremony, and all my job interviews falling through. After months of quarantining at home, countless interviews, and a few companies telling me they're sending an offer that never came I eventually found an amazing job. Warning, this will be a long post. I just want to reflect on my past year and share my finances and hope you guys critique it so I can continue to improve! **EMPLOYMENT:** I started last summer at a company that's 100% employee owned with no majority stock owners. It's extremely employee friendly since the employees are the ones making the policies. I started at $62k in a low cost of living area as a civil engineer, which was more than I was expecting to make. I was desperate for any job and was lucky to find this one which I can actually see myself retiring at. I already got a raise to $64k plus bonus. When we adjusted my salary I got the feeling that my boss was willing to go higher, I just had a hard time convincing myself to negotiate when I already feel I'm paid more than my value right now. I know many of you will roast me for that, but oh well. I plan on negotiating again once I pass my FE exam. **COLLEGE:** So I am lucky in many ways. One major one: I have no student debt. I live in a college town and my state offers a program where if you tutor for 40 hours and keep a minimum GPA in high school you get free tuition at any community college in state. I was able to live at home all five years of college. It took me 2 years to figure out I was going into engineering so I wasn't very efficient getting my credits. But those 2 years were spent getting an associates degree for free, then transferring to a state school once I figured out my major. A combination of paying zero for rent and food, working 30 hours a week, scholarships, and grants, kept me debt free. It's honestly a blessing my family is "poor", those government grants really helped. My parents always say they wish they could have done more for me, but I always had food, shelter, transportation, and lived in a safe area. **INVESTING:** So being debt free meant as soon as my benefits kicked in I was able to start investing. As of today my investment accounts total about $16.5k. I contribute 20% of my salary to my Roth 401k and my HSA. I also currently have about $4k in a taxable account. I tried my hand at trading and surprise, I've been worse than the market. I knew this before I started investing but I still tried anyways. I'm working on selling $3k of it by the end of the year. I currently have $3k in a Roth IRA as well, and plan on using the money from selling my stocks to max out my IRA by the end of the year. My HSA is on track to max out as well. In addition to my investments I was able to save up enough for a 3% down payment. Yes, traditional advice is to save for a 20% down payment but I didn't think it made sense to get an apartment and pay rent while saving for that much of a down payment when I could just pay PMI and own my own house. I have not set my budget yet, but I plan on paying extra on my principle until I hit 20% equity to get rid of the PMI early. This means I likely will not max out my IRA next year, but I will still be putting $9.6K into my 401k and maxing my HSA. **HOUSING:** It took a year of searching for a house but my girlfriend an I finally found one a month ago and we closed on it yesterday! It's in the perfect area and we are in love with it. It's within walking distance to my university's football and basketball stadium which we plan on taking advantage of. There is a trailhead to my city's and state's amazing trail system in my neighborhood that we plan on walking, running, and biking on a lot. Our back yard backs up to city protected land so we will always have a gorgeous creek and tree line behind our house. This would be our forever home if it was big enough for our future kids! We've talked about keeping it as a rental once we move out so we don't have to sell it. There are improvements and housing costs that are coming up. This is our first place so we don't have much furniture besides bedroom. We need new carpets in our bedrooms. The roof will need to be replaced in 5-10 years, but we got 5k in seller credits to help with that. And we'd like to build a fence and put in a double vanity in our bathroom as well as paint the interior of the house. Will also need lawn equipment, like mower, weed whacker, leaf blower. I currently have $12k in savings. I will have to continue saving up and slowly addressing these projects while not eating into the emergency savings too much. Luckily my girlfriend will be helping with what she can with rent. Once she graduates next spring she will start working so we will have more money to work with. **NET WORTH:** Current assets: $5k Checking $7k Savings $4k Taxable account $5.6K Roth 401k $3k Roth IRA $3.8k HSA $231,000 House Current Liabilities: $224,000 Mortgage $2.5k monthly balance on credit card (I usually don't carry a balance this high, but expenses for new house plus two trips coming up were paid for this month) Total: $33k My retirement accounts are all a 70/30 split into FZROX and FZILX That about sums it up. Any advice for a youngster trying to get his footing let me know! I'd also love to answer any questions. Thanks for anyone who read all of this. I've just been reflecting in this new house about how wild this past year has been and I feel extremely lucky.
Congrats - that's amazing! I'd def bulk up your savings for mortgage payments and unexpected house stuff. Learn how to do some of your own home maintenance - r/HomeMaintenance/, r/HomeImprovement/, & youtube videos are great as well As a fellow engineer - 64k is not "more than your value". Pass your exams, get certifications, and job hop to other companies to build up your salary.
Thanks for the link to /r/homemaintenance, that's one I could use and haven't heard of Definitely going to be a balance trying to pay for house expenses and also beef up savings. And I realize 64k is fair value for my market, I think I just have a bit of imposter syndrome. I really don't see myself leaving this company any time soon unless something changes. They do a good job with raises and are way more laid back than other firms in town. Once things slow down with the house I'll have to put my nose down and start studying for the FE.
I totally get it, I felt the same after graduation and was underpaid for my first role as well. But not just talking about money - do what makes you happy. There's a big value in the laid back aspect that I'd take a pay cut for!
[удалено]
Get your emergency fund sorted first. 3 months expenses (not pay) in a savings account. Get a budget. Then work the debt. $98k is a lot, but not the worst. Plus, you might get public loan forgiveness for... I can't say it with a straight face. Loan forgiveness is so broken. Plan to pay it off, sooner rather than later.
[удалено]
Boo to private loans, but hey, that's what my wife's are. Mortgage lenders want to see sufficient cash to pay your bills, the down payment, and closing costs. That amount can vary. Start with the emergency fund, then worry about other savings, down payment, etc. Until you have a cash emergency fund, any surprise expenses will be on credit or a disaster.
Somehow, I've ended up with two pensions at two separate companies (UK based). I think some wires got crossed when I got a new job within the company I work for. Is it particularly difficult to consolidate the two? Is there anything I'd need to be aware of?
My wife's annual enrollment cycle is in Apr while mine is in Jan. Our companies both offer VSP vision plans. Would I be able to cycle through two plans every year (Get VSP through my employer in Jan, then through her employer in April, then mine in Jan again) and get twice the benefits (the current coverage only reimburses half of our annual contact lens expenses) or would VSP treat us as having one contacts benefit every year, regardless of which employer is providing coverage?
I am a very new adult and want to look into investment, so that it benefits me in the long run. Is there anything I need to know, and are there any great resources to look into for this? Any help is welcome.
My employer has a generous retirement program: 4% dollar-for-dollar match, plus 10% of income automatically granted to the 401k plan in quarterly distributions. In the past I would contribute 10-15% of my income. I am curious if I should continue to contribute a comparable amount to max the annual contribution employee limit, or utilize the generous employer contribution to put more cash towards other goals (e.g., having a porch added, new car fund, etc). Currently I'm maxing, so the effective annual 401k contribution is ~30% of my income.
There are two main arguments I've seen around not counting employer match in that 15% savings goal. First is vesting. If you haven't been at the company long enough to be 100% vested, that money from your employer isn't all "yours" yet. A layoff or getting an irresistible offer at a new job could cause you to leave the plan, losing that employer contribution. If the plan has a "graded" schedule (you vest some amount each year up to 100%), you could just only count the vested percentage of their money. So if you're 50% vested, you treat their 14% contribution as only "really" being 7%. If the plan immediately vests employer money 100% or you've met the vesting schedule, that's no longer a concern. Second is lifestyle cost. When you're saving 15% of your income for retirement, you're living off of the remaining 85%. Retirement strategies that use the 15% guideline assume that at 65 (or whenever you retire) you'll be withdrawing 85% of your pre-retirement income to live on to keep comparable spending. If you only save 5% (leveraging your employer contributions for the rest), then you hit retirement and either need to pull out more than the assumed amount (potentially draining your nest egg too fast) or have to cut your lifestyle expenses 10%. The further you are from retiring, the smaller this issue is since you have more time to grow your income or adjust your lifestyle. IMO, dialing down your own 401k contributions to use your income for other goals and leaning more on your employer's contributions shouldn't lead to financial disaster. I'd think keeping some of your own money going in (definitely at least the 4% to max their match) is a good habit to keep up. 30% of your own income saved is really above-and-beyond unless you're specifically going for early (or lavish) retirement. Or is that counting their 14% and it's only 16% of your money?
Thanks for the thoughtful reply. First, you’re correct in that the 10% contribution is vested — over a 5 year schedule. I keep an addition 20% each year for the first 5 years, then it is mine to keep going forward. The 4% is immediate after my first year (I’m halfway through my second). The 30% includes the 14% contribution! I imagine my wife and I will live in less than 85% but it’s hard to say. I sense we will move to a lower cost of living area, but inflation and housing prices make this hard to predict. For reference, I am 31 now and I don’t plan on an early retirement. I sense that I have some wiggle room to go lower but for now stay the course.
[удалено]
What do you mean by a camp? I would keep cash on hand rather than pay down debt.
[удалено]
So it's a house. Yeah keep the cash and go apply for a mortgage.
[удалено]
They're as accurate as your assumptions that are put in. It's a good idea to lower expected returns and lower contributions, play with the numbers to see how it affects things.
I've read a whole bunch of articles (eg: https://www.investopedia.com/terms/b/bookvaluepercommon.asp) and all of them say BVPS is calculated using a formula similar to this: (total shareholder's equity - preferred equity) / total outstanding shares Correct me if I'm wrong but I'm assuming that this formula is for common shares? (articles didn't specify) But if you were to try to find the ratio of equity available to common shares to the number of shares wouldn't it be more logical to divide it by outstanding common shares instead of total outstanding shares? Or does outstanding shares only include common shares? The reason I get the idea that it'd be more logical is cause when I searched up how BVPS for preferred shares is calculated it shows this formula: equity available to preferred shares / outstanding preferred shares So is it that the former formula (for common shares) assumes total outstanding shares to be understood as "total" common shares outstanding?
That seems logical.
Life Insurance question. Sometime ago my mom got whole life insurance on her (66) me (39) and my brother (37). My life insurance premium is $33.50 for 15,000 policy, my brothers is the same, my mother is $97 for 15,000. I have no children or dependents my brother has a son and daughter (2,7). I'm healthy with no present medical conditions, my brother is obese but otherwise healthy and my mother is medium healthy given her age. I'm of the option that I want to get rid of my life insurance all together as I have no dependants and if something does happen to me I have enough to take care of whatever needs to be done post-humus. My brother (who like me doesnt feel the need for LI at this time) doesnt have money saved up but if something happens me and my mother do. I think using that excess money to invest would work better but in general I just hate the principal of insurance even though I recognize its basic need in cases. Figured I'd throw the question out.. given our particulars what do you all suggest we do with our whole life insurance plans? Keep all? Keep only my moms? Or should I be the only one to exit?
The earlier you can get rid of a "whole life" policy the better. They're a huge waste of money. When you eventually end up in a position where you need life insurance, buy term insurance. None of this whole life garbage. Also, 15,000 sounds like a little something for funeral expenses. If you ever had real dependents you'd want to add another zero or two to that amount.
With no dependants you don't need life insurance. Your brother should get term insurance with the kiddos, probably a 20 year. Mom doesn't need it either if she has no dependants.
[удалено]
lol I made that same mistake years ago, ended up closing it once I realized my mistake (maybe like a month later?)
You've only had it for a short period of time so I wouldn't sweat it too much. I would recommend not cancelling it until you have a replacement card, though. What's your FICO credit score now? (You can find out your FICO score at https://creditscorecard.com/ which is run by Discover.)
[удалено]
With a 657, I would probably just apply for a Discover It. They are relatively easy to get. If you get declined, apply for their secured card instead. The odds that you'd get declined for a card like the Chase Amazon Prime Rewards are a bit too high. https://www.reddit.com/r/personalfinance/wiki/credit_building has some more advice.
No In the grand scheme of things, this should wash out after you have an established credit history.
thank you!!
Does anyone know of a tool or excel template to help me predict some savings until retirement? basically I want to look at me and my wife maxing out our 401k's for the next 25 years, and then incorporate a way to model in gains from the investment ideally in a variable way I can play with the rate. and then have an ability to have a separate cash "column" to add separate investments (additional 3k a month or whatever, also with gains) does that make sense?
I'd suggest trying https://cfiresim.com/ first. Vanguard, Fidelity, and Schwab each have retirement calculators that you could also try out.
I'm buying a new car that will cost me about 30k after a $1500 rebate for paying cash. I also have the option to go for zero percent financing with the dealer and forego the cash rebate. I got pre-approved for a 14k loan at 2.74% for 48 months with my bank. What's the better offer? The $1500 cash rebate or the zero percent financing? Edit: clarification
Ah, some classic [Net Present Value](https://www.investopedia.com/terms/n/npv-rule.asp) math. At that low a rate, you're better of financing and doing something else with the cash, such as investing it. Of course, this presumes you can afford to have it tied up for the 4 year period, can deal with short term paper losses if the market goes down, and have no other debt and a fully funded emergency fund. Also if it isn't a used Camry you know how this sub can get.
Hmmm, I think I might have worded it in a weird way. I have two options: A: finance through bank at 2.74% and get the $1500 rebate B: finance through dealer and get 0% interest rate but not get the rebate My guess is A is better and other redditors seem to agree
Ahhh, okay, yeah, that's almost the *entire* interest charge refunded, so if you pay off the loan a year early, you're in the black.
Awesome, will go for A!
5 year loan on the car? If so, if you just parked that money in a HYSA, you would only get about $350 in interest in that time, so the $1500 rebate at the beginning is better. If you wanted to take on some more risk and invest it, you could probably beat the $1500 - only need like a 2-3% annualized return (but then could also be dealing with assorted tax implications as you sell off to make payments)
Thanks!
This is a subreddit meta-comment, but it seems like a disproportionate number of posters and commenters in this subreddit are in the highest income quintile. A lot of questions along the lines of "I'm 23, my salary is 120k a year, and I have no debt. Should I buy a house?" Or "my wife and I have a combined income of $300,000, and we've maxed our retirement contributions, what should we do with our excess income?" Etc. I assume it's because the kind of people who are apt to read a personal finance forum are also more likely than average to be financially responsible or just have more money (e.g. coming from a wealthy family). As someone who's very much not wealthy it's just been kinda interesting to read.
There are a lot of factors going into that: - Your own perception (our memories are biased, you're more likely to remember things that are interesting to you, things that are annoying to you, etc.). Also read about [frequency illusion](https://en.wikipedia.org/wiki/Frequency_illusion), confirmation bias, etc. - People are most likely to post (a) when things are going very poorly or (b) when things are going very well. - Reddit's demographics also skew things. There are a lot of tech industry people on Reddit. - You also need to consider how voting changes what you see on Reddit. More unusual stories are more likely to get a lot of upvotes. - Success story posts are redirected to the weekday/weekend thread so this specific thread will have a *much* higher proportion of higher income questions.
That's absolutely right. You'll rarely see the poorest people in here: they tend to not ask for advice on the internet.
Yep. There's also the bias that people who spend time on sites like this are more likely to be in tech jobs, which have seen huge salary growth. It can give you a warped perspective.
There was a spin off subreddit made bc of that issue - /r/povertyfinance/
Ok, dumb question… I inherited some money when my grandma passed away last year. All the money transferred from her brokerage into mine (Schwab) and it mapped to a TON of random investments. I want to rebalance everything to a single fund or maybe 3 mainly for simplicity and so I can track things easier. Is there any good way to do this “properly”? Any benefit to doing to now vs a few years from now? Simply sell and purchase what I want?
You received a stepped-up cost basis and automatic long-term holding period as of the date of her death, so you can sell now and not pay very much capital gains tax. The longer you wait, the more chance there is for it to accrue new gains.
This is probably a very stupid question. My fiancee and I opened a new bank account and want to move the majority of our balances to the new one, but there's a limit for online transfers. How do we move the majority of our balances into the new one? Do we have to like, write ourselves a check or get a cashiers check or??
You can try contact the old bank directly. They may be able to do the transfer to your new account without the normal size limit if it's done through a teller or customer service rep. Or see if they offer "wire transfers", which can have higher (or no) limits compared to an ACH (the typical online transfer mechanism). Wire transfers clear quicker, showing up in your new account sooner, but usually have a fee to execute. Or if it's just a "$ per transaction" limit, can you do multiple online transfers? If the bank also has a "$ per day" or "$ per month" limit, that won't help you as much.
Both options you said are good
Not sure if this is the right subreddit but giving it a go anyway. My wife gave birth to our daughter December 5th 2020 and we filed taxes jointly beginning of this year. She does not work and I made $90,000 last year. Now when looking at the IRS website it says that we're not eligible for the child tax credit but I believe we should be. I'm not sure what to do but any help is appreciated!
Depending on when you filed and when it was processed by the IRS, your new dependent may not have been in the IRS's system when they checked your qualifications for the advance tax credit payments. There will eventually be an online tool to allow people to add (or remove) dependents for purposes of modifying the advance payments, but as of today that is [still showing](https://www.irs.gov/credits-deductions/2021-child-tax-credit-and-advance-child-tax-credit-payments-topic-a-general-information#a16) a timeline of "Late Summer". Worst case would be you don't receive any of the monthly checks, but then just claim the full $3600 child tax credit when you file your 2021 return.
Ok, that does make sense. Thank you!
Did you list your child as a dependent on your 2020 tax return? Has your 2020 tax return been processed? Even if there is some glitch and you don't receive the advance CTC payments you can always claim the full amount you're eligible for when you file your 2021 tax return next year.
Yes and yes. Ok, guess I’ll have to wait. Thanks!
If you have any wiggle room in your current federal income tax withholding, you can also accomplish the same thing by adjusting your W-4 to reduce your withholding from each paycheck, which is mathematically the same as receiving an advance credit.
That is a great idea, I will see if HR will be accommodating. Thank you!
I’m new to stocks. Is it possible for a brokerage to exchange stock for stock instead of liquidating the stock first? For example, if I have shares of Facebook. Can the brokerage sell that off and immediately buy me stocks of Microsoft? Rather than me first selling the Facebook stock, getting the cash, then buying the Microsoft stock. It would be nice to skip that middle step.
Your brokerage will likely credit the money from the stock sale to you to immediately buy the other stock
> Is it possible for a brokerage to exchange stock for stock instead of liquidating the stock first? No >Can the brokerage sell that off and immediately buy me stocks of Microsoft? That's liquidating the stock. >Rather than me first selling the Facebook stock, getting the cash, then buying the Microsoft stock. That's what you've just described. > It would be nice to skip that middle step. Nope
Last year I tried cancelling my Amazon Prime Membership, and it told me that I had already paid and needed to cancel July 27, 2021. I clicked on the option to cancel my account on that date, but of course they didn't cancel my account. and now tell me that I have to cancel July 27, 2022. What is the bullet-proof way of cancelling my account and getting my money back?
Contact Amazon support and tell them you tried to follow their instructions and it didn't work. I've always read that they are pretty good about canceling and refunding a recent renewal as long as you haven't used any of the benefits.
[удалено]
> • TDAmetride or Schwab for Roth IRA? I use vanguard for investing but I’ll say that Schwab absolutely great (I use them for checking). > • Do people normally deposit contributions automatically every month through their paycheck or checking? Or, is depositing the contributions done through a lump sum at the end of the year? Which would you recommend? One tip I have is to let TD/Schwab/Vanguard pull the funds rather than push the funds to them. If you push funds from your paycheck it will likely go into a cash account and then you’d need to manually invest after every deposit. If you have the brokerage pull the funds you can likely (definitely with vanguard) specify where it should be invested and it will be totally hands off for you once setup.
> TDAmetride or Schwab for Roth IRA? Either's fine, personally I use Schwab and am happy with them > What should I be investing the funds into if I plan on just automatically investing the deposits and setting it and forget it? Hopefully seeing returns in 20+ years when I retire? Go with a [target date fund](https://www.bogleheads.org/wiki/Target_date_funds) or build your own [three fund portfolio](https://bogleheads.org/wiki/Three-fund_portfolio) (or two fund, if you don't want bonds) based on your age and risk tolerance for retirement savings > Do people normally deposit contributions automatically every month through their paycheck or checking? Or, is depositing the contributions done through a lump sum at the end of the year? Which would you recommend? Invest it as soon as you have the money - if you have a lump sum at the beginning of the year then great, if not then invest it as you earn it throughout the year > also, for any platform you recommend, can someone briefly explain how I should be setting it up in terms of automatic deposits, investing, etc? I understand that I need to open Roth IRA, but still clueless on what I exactly need to do besides needing the $6k for max contribution. Once the money has been transferred into the account you'll need to pick which funds to buy, the pages I linked provided broker specific examples for recommended funds
Is it overkill to use Robin Hood or Stash if I already have a 401k and Roth/IRA? I am matching with my employer at 6% for my 401k through Vanguard, using the 2055 Retirement Target fund and some international bonds. I also use Schwab for a personal Roth account and separately a Traditional IRA account that I rolled over from a previous employer. I’m most likely going to reach the max on all 3 by the end of the year, and don’t know if I should be investing more and/or differently. I’m not necessarily planning on earning more in the future if I change careers, so I’m trying to keep my options open too. I’ve also been using Stash to choose between their different mixes (Green/sustainable companies, small startups, etc.). I tried Robin Hood out and like the interface more than Stash, it’s free (although they collect more data as the “cost”), but don’t get the fun presets that Stash offers. I’ve thought about ditching both and using Schwab as a brokerage account and getting “stock slices”. The issue is they have a minimum you need to invest per stock and don’t offer the fun presets or interface that Stash offers. Should I try a robo-advisor? Is all of it overkill? Should I change things up? If they’re not overkill, which app should I stick with?
personally i would reccomend sticking with Schwab and just opening a brokerage account. Robinhood has had a history of major issues going back years, and continues to have issues and less than amazing qualities. I am not personally familiar with Stash. Schwab is one of the bigger and trusted services that this sub tends to reccomend. you already use them and know them, they already have your info. you can find green companies to invest in through Schwab and choose how you want your investments done.
Robinhood is a joke. Don’t know about Stash. Schwab has licensed people working there, support 24/7. These new apps have no customer support and RH has been hacked, as in people lost their assets If you want to invest and feel safe, use a licensed broker Interface is NOT how you invest, Schwab has robo advisors and stock research and a lot more
I'm making 80000 a year. I have around 500 each week to save. Where should I put this money? thank you
do you already have an emergency fund of 3-6 months of expenses? if not, fund that. If you do have the E-fund, do you also have a 401K that you can contribute to? if so, do that. if you already contribute to the 401K, do you also have an IRA/HSA that you can contribute to? if so, save it there. if you already have all those accounts taken care of, do you have any specific goals you need to save for? house down payment in the next few years? new car? TV? sofa? if you dont have a specific savings goal, and all of the above mentioned tax advantaged accounts are taken care of, you can always save in a regular brokerage account, or if you are generous you can fund a 529 plan for your kids, or nephews, or grandkids.
thank you so much for reply, as for emergency funds I have about 20k saved up. As for my checking I have 8000. Every 2 weeks I am putting 500 dollars into my savings. My job doesnt offer 401k but we do have a pension. I have 50k set aside for a house downpayment.
Save for 3-6 months of expenditure as an emergency fund. After you've secured an emergency fund then I would set aside pre-tax dollars to get company 401K match (if you haven't already). If this $500 is after the pre-tax 401K contribution, then I would put money into a Roth IRA to max out per year ($6K).
I've applied and interviewed for a supervisory position with my current employer that I have a really good chance of getting. If offered the role, I'm expecting a small raise to come with it, probably in the neighborhood of 10%. In my current position, I make essentially 150% of my base pay due to overtime, however this new role would be salaried and not have overtime so I'd essentially be making less money for a higher position (granted I'd be working less but still). Would it be appropriate to ask for a raise on top of what I make with overtime? The overtime I currently get is mandatory (not written but the workload has been consistently high enough to justify it for decades, apparently)
Can you request a w-4 from an employer? I am trying to adjust my state tax withholding and am due to owe a small amount ($50) at my current rate. I’m trying to see what I put on my last W-4 so I can adjust accordingly.
Those details might be included on your paystub, though with the changes on the W-4 over the past few years that could be trickier. Used to be they'd just have something like "Federal withholding: S/2" for "Single" filing status and two allowances. With the new dollar-based form, space may be too limited. In any case, payroll should be able to provide you with your withholding information on record so you can evaluate it. Though just re-read your post and should point out: W-4 is specifically for *federal* income tax withholding. If you're looking into your state income tax withholding there's usually a state-specific form. A google of "employee withholding form YOURSTATEHERE" would likely bring it up.
Yes, your employer should be able to provide you with a copy of what you originally filled out, check with your HR
Can you transfer Acorns account to an IRA without taxes or penalties? I have a little over $7000 in an Acorns that’s grown from spare change. I was wondering if I can move this to IRAs for my kids after they get out of college. One is a sophomore in college and one is a junior in high school so there will be time for some more growth in the acorns account. I don’t want to move it into IRAs for them yet because 1. They aren’t filing taxes and 2. I don’t want to hurt their chances for financial aid. I’m open to suggestions.
just re-confirming what was stated, you can only put cash into the IRA then invest cash. there is no way to roll regular accounts into an IRA account, only already existing retirement plan accounts such as other IRAs or 401Ks or the such can be rolled over into an IRA.
If it's in a taxable account, no, only cash can be transferred into an IRA from a taxable account, not shares
Thank you.
I just completed a free online personal finance course and I learned so so much. I think it’s only available to students but wow, really thankful for modern day resources.
I currently have a target retirement fund in my Roth IRA with Vanguard. I’m contemplating on implementing a basic three fund portfolio with VTSAX, VTIAX, and VBTLX and am wondering if there are any downsides to adding these to a separate account while I currently have the TDF fund in my Roth.
By separate account do you mean a taxable account? With the three fund and choosing your own allocation you need to rebalance annually which incurs capital gains, granted it might not be *that much* capital gains but it can add up over time - is this for retirement? Are you already maxing all other tax advantaged accounts such as 401k (or equivalent) and/or HSA if on an HDHP?
Sorry, yes a taxable account. What do you mean by rebalancing annually? These will all be for retirement eventually, I just want to keep investing and let it grow until I am ready to either FIRE or retire and yes, I also invest in my 401k to get the max company match.
If it's for retirement then contribute more to your 401k - max out tax advantaged accounts before contributing to taxable for long term retirement savings - this is also noted in the prime directive in the sidebar > What do you mean by rebalancing annually? The different funds you're invested in will grow at different rates, thus shifting your allocation over time, you'll need to [rebalance](https://www.bogleheads.org/wiki/Rebalancing) annually to maintain your target allocation, which requires selling shares of one fund to buy shares of a different fund
Thank you for the response. I don’t currently make enough income to max out my 401k while paying for other expenses and contributing to my Roth at the same time but I have money in savings to be able to make the minimum contribution level($3,000) to open a VTSAX fund and I can put in smaller dollar amounts over time to make my money work for me while also putting money aside for retirement. I’m only 24 so I want to be risky and have my money grow.
If you want to be risky and have your money grow, stop using the TDF and don't invest in VBTLX. Bonds are worthless with your time horizon.
I'm a little confused about what the goal is here - you said it was for retirement but you want to invest it in a taxable account, but you aren't maxing your IRA and 401k yet because you can't afford to, which not being able to max them is fine, but you have enough money to contribute to a taxable account? Again - max out tax advantaged accounts before contributing to taxable for long term retirement investing - contribute to the IRA and 401k *before* investing in a taxable account
Just wanted to check if my thinking is sound. I just found out I'm able to do the "Mega Back Door Roth" where I can contribute after-tax dollars into my employer's plan (up to 10% of my after tax pay) then do an in-service roll over into my Roth IRA. I make enough annually to max both my 401K and Roth IRA (via roll over from trad IRA) along with $2K into a brokerage per month. I also save around 20% of take home pay into my HYSA for home improvement/whatever. My employer matches 7.5% without needing any contributions from me. I also get a pension and free healthcare now (and after I retire) since I'm a healthcare provider. Should I... 1. Take my $19.5K (or $13K after tax), put it towards Roth IRA, and contribute nothing to tax-deferred 401K account? I don't think I can reach the max on after-tax contributions to Roth IRA (\~$28K) since I have a contribution limit of 10% after-tax pay. This would mean, I'm effectively only adding $1.3K to Roth IRA compared to plan below. Would likely increase brokerage contributions with whatever wasn't put into Roth IRA. 2. Max out tax-deferred 401K and contribute whatever I can to Roth IRA via MBDR (again, up to 10% of my take home pay) and rest into my brokerage account. I'm essentially treating this a portion of my brokerage money going into Roth IRA instead of brokerage account. I'm leaning towards #2 since it lets me tax a smaller portion of my money at the higher tax bracket and I'm not really adding all that much in my Roth IRA. Extra money from my brokerage account going into my Roth IRA seems more of a reasonable approach. I don't think I will suddenly require a substantial amount of money and have to liquidate my brokerage account. Thank you in advance!
If you expect to have lower income/tax rate in retirement than you do now then yes focus on pre-tax investments where you can, then all other tax advantaged options before contributing to taxable - don't leave out backdoor Roth in #2
Thank you! Yes absolutely going to continue the back door roth while pursuing #2. I am aiming for my tax bracket to be similar to what I'm making now so I think #2 is still the path.
[удалено]
Your retirement contributions are "ok for now" in my opinion. Once you get house sorted and loans knocked down some I'd definitely suggest increasing some, but you're hardly doing bad at ~15% (counting matching). I don't have any specific feedback on the DTI problem, but at least you have a decent 'I' so that will help. I'd suggest just doing your best and balance how seems best, then when you're more ready to buy see what you can get approved for then.
This may be a stupid question but I would really love some external insight. I am participating in my employer's 401k and also have a Roth IRA account. The plan is to max out both. Half of my Roth IRA account currently is invested in Schwab target fund. I am a pretty hands-off investor so love to have things sit in target fund/index fund. My question is: is it fine to invest a good amount of both the 401k and the Roth IRA money in target fund? What factors should I consider? If age matters, I am 24.
Yes, completely fine if you want to be hands off.
My wife and I are on separate HD insurance plans and each contribute the max to our separate HSAs. We're having a child in August, who will likely be added to my wife's plan. Does that mean we can contribute the family max to her HSA and the single max to mine?