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Thread: Financial Advice/What Would You Do?

  1. Team Rocket
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    #1

    Financial Advice/What Would You Do?

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    Now that I have a job, I find myself in an interesting situation. I'm not sure what to do with my money. As in, I'm not sure what the best option is right now. I was hoping for some input/advice and some ideas about what others would do, and why. Here's the scoop: DH makes more than enough for us to live on right now, and so he said he doesn't care what I do with my income. I have a number of options:

    -Save it
    -Put it in retirement account
    -use it to pay down student loans
    -other?

    Our current situation: DH is E4, getting out in July. I'm bringing home about 1300$/month now-May, and then June-Aug will be getting about 2100$/month (after taxes!), for a total of 10,200$ between now and August. The only debt we have is my student loans. I have 10K in unsubsidized, that I really want to try to pay off, and could with the money I'm earning, and another 30K in subsidized.

    We have about 35K in emergency savings, 15K in each of our retirement accounts, and DH has been accepted into school in the fall and thus will be getting his GI BILL benefits.

    But, I still feel like I should just save the money because.... what if something bad happens? Is 35K enough? I have no idea. I still haven't heard back about the PhD program so I have no idea what will be happening to me come Sept, but I will either be in school or working. Or maybe I should use the money to pad my retirement account some. I dunno.

    What would you do?
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  2. MilitarySOS Jewel
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    #2
    I would put in into savings at least until after his transition out of the military and into your new lifestyle. Once you feel comfortable and get the hang of that I would start paying down loans.
  3. "If you don't like my attitude, quit talking to me"
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    Me...
    I'd split it in 3rds..
    1/3 of pay to retirment, 1/3 to student loans, 1/3 to savings.
    This way you are covering all 3 which are all equally important.

    I don't recall. with the GI Bill, don't they just get MHA (housing allowance) and no actually pay?

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    #4
    Quote Originally Posted by TrishAFSpouse View Post
    Me...
    I'd split it in 3rds..
    1/3 of pay to retirment, 1/3 to student loans, 1/3 to savings.
    This way you are covering all 3 which are all equally important.

    I don't recall. with the GI Bill, don't they just get MHA (housing allowance) and no actually pay?
    Splitting it is a good idea.
    The GI Bill does only cover housing & books, but I know I will either be getting a PhD Stipend or working. Yesterday at work I saw something I wasn't supposed to see about a research project being assigned to me in October so I know there is plans of the dept keeping me either as a PhD student or employee, I'm just not sure which yet
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    #5
    Quote Originally Posted by rocket_lizz View Post
    Splitting it is a good idea.
    The GI Bill does only cover housing & books, but I know I will either be getting a PhD Stipend or working. Yesterday at work I saw something I wasn't supposed to see about a research project being assigned to me in October so I know there is plans of the dept keeping me either as a PhD student or employee, I'm just not sure which yet
    Ah, ok.
    I was only asking because he will be losing some pay then when he gets out. I would definitely save some to cover bills or such that he might normally be paying right now that he possibly can't when he gets out.

    One question.. your retirement, what kind of account is it? If its an IRA you can only contribute $5000 a year.

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    Quote Originally Posted by TrishAFSpouse View Post
    Ah, ok.
    I was only asking because he will be losing some pay then when he gets out. I would definitely save some to cover bills or such that he might normally be paying right now that he possibly can't when he gets out.

    One question.. your retirement, what kind of account is it? If its an IRA you can only contribute $5000 a year.
    It's a ROTH IRA, so you're right. I forgot about that stipulation. I supposed I should try to get at least a couple thousand into it this year though.
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    I'd probably put most of it (maybe 90%, so that the loan will be paid off fully by the time he gets out) toward student loans, and some to savings. When that loan is paid off, you free up monthly dollars which means your cash flow will be fine if you take a hit when he gets out. Once he's out, if he gets a job or if you get your PHD stipend or a job, then I'd finish off the loan (if there is any left) and then put everything to retirement.

    Once you put money into a retirement account, you can't access it. (In theory, you can, but it is very expensive and a terrible idea.) Not putting more money into retirement until the Fall isn't going to make much difference long term, and you'll be happy that you have more savings and less debt (and less monthly cash flow going to debt) if finances when he gets out are rough.
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  8. "If you don't like my attitude, quit talking to me"
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    #8
    Quote Originally Posted by rocket_lizz View Post
    It's a ROTH IRA, so you're right. I forgot about that stipulation. I supposed I should try to get at least a couple thousand into it this year though.
    Yeah I believe it goes April-April... but I don't recall, so you have a month or so to get in up to $5000.

    So with that, I would put $5000 to the IRA, then just split your money in 1/2 after that.. 1/2 to savings, 1/2 to student loans. then repeat that annually. So, of your $2000 (because its easy math) per month I would do like $300-$400 a month to IRA, then $800 to savings and $800 to student loans.... (examples)

    There are 10 types of people in the world, those that understand binary and those that don't
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    #9
    does your company have a 401k plan? If they do I recommend doing that versus putting money into an IRA. You get more benefit from a 401k.

    There are 10 types of people in the world, those that understand binary and those that don't
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    #10
    Since I saw your last post, I want to add that you can always start a regular investment account once your IRA is maxed. There's no limit to contributions to that and it is very easy to do. You can pick a Target retirement fund to put everything into if you want something really simple, and that will make sure you are somewhat diversified and also that your risk level is appropriate for how much time you have left until you retire.
    Science always wins over bullshit. ~Dick Rutkowski
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