|
We closed on our house a couple of weeks ago, and I've been debating what to do with the proceeds from the sale. Here is the important info: My wife has $38,000~ in student debt (5.7% interest) We don't have a car payment, and won't in the future (my job takes care of that) We have no credit card debt I myself have no student loan debt We made $55,000~ from the house (after costs) We just signed a 12 month lease for an apartment so we didn't have to rush into buying a new house and could take our time (and could save a bit of money, even though renting is loving ridiculous) So I ask you goons, what the hell do I do? Going into the house selling process, my plan was to pay off my wife's loans entirely and then take the rest of the money and put it into a large down payment on a different house (in a less desirable area, because I'm a cheapskate, and start the process over again). I figured if I could do that, and reduce our total debt while lowering our overall interest rate by a point or so, it'd be like refinancing. I know absolutely nothing about investing, which is why I've been apprehensive to go in that direction (I'm not a betting man). Any thoughts?
|
#
?
Feb 3, 2018 04:31
|
|
|
|
| # ? May 1, 2024 13:25 |
|
|
ozymandius1024 posted:We closed on our house a couple of weeks ago, and I've been debating what to do with the proceeds from the sale. When you say you know nothing about investing, do you and your wife contribute to a 401k? You want to put 15% of your gross away, at a minimum. While you have reasonably sizable high interest debts, I would say its best to only invest enough to hit employer match and kill the debt... As soon as the student loans are gone, >15%. That is another discussion though.
|
|
#
?
Feb 3, 2018 08:46
|
|
|
SiGmA_X posted:5.7% is a solid guaranteed return rate. I would pay off those student loans right away. Then stockpile cash in a high yield savings account (>1.4% at basically all online banks these days) for your down payment on the next house. You don't want short term (<5yr) savings in The Market. At most you could use a money market or short duration treasury fund. My wife has a 401k through her job, but my employer doesn't offer anything (and it's not something I've ever looked into because of my lack of understanding/laziness).
|
|
#
?
Feb 4, 2018 00:20
|
|
|
Investing isn't day trading, it's not betting in that sense. Take the next couple of months and look into the long term investing thread and make it a priority to learn how to save and invest your money. Don't put it off, it's one of those things like exercise where it doesn't matter if you're doing it perfect, just that you start as early as possible and keep at it consistently.
|
|
#
?
Feb 4, 2018 06:55
|
|
|
Make sure you set aside enough money that you can avoid PMI on the next home loan. Otherwise pay off student loan.
|
|
#
?
Feb 4, 2018 09:05
|
|
|
Let me tell you about this new exciting thing called Bitcoin!
|
|
#
?
Feb 4, 2018 09:18
|
|
|
moana posted:Investing isn't day trading, it's not betting in that sense. Take the next couple of months and look into the long term investing thread and make it a priority to learn how to save and invest your money. Don't put it off, it's one of those things like exercise where it doesn't matter if you're doing it perfect, just that you start as early as possible and keep at it consistently. I will do that, thank you  n8r posted:Make sure you set aside enough money that you can avoid PMI on the next home loan. Otherwise pay off student loan. That's been my aim, and I don't think it should be too much of a problem.
|
|
#
?
Feb 4, 2018 14:24
|
|
|
do you guys have any retirement savings
|
|
#
?
Mar 13, 2018 00:17
|
|
|
Y probably know this, but make sure you qualify for the tax exclusion (lived in it a full two years during the 5 years previous to the sale, etc.). If you get a 1099-S your broker probably hosed something up. I have a friend who hosed that up (didn't meet the requirements) and had to pay income taxes. Assuming that is fine, pay off the 5.7% debt. Like SiGmA_X says that is a guaranteed rate of return and 5.7% isn't bad. For a guaranteed return it's quite good actually. Then put aside a 6 month expenses emergency fund and if anything is left look to tax-advantaged (retirement) and taxable investments in that order.
|
|
#
?
Mar 14, 2018 15:47
|
|
|
n8r posted:Make sure you set aside enough money that you can avoid PMI on the next home loan. Otherwise pay off student loan. This, but to take it a step further, also look into Roth IRA/traditional IRA/stock/bond options. If you go the stock option, be sure to do a proper valuation of the company's stock to see if it's under/over-valued (https://www.sec.gov & https://finance.yahoo.com). If you go the bond option, look for one that's non-callable at least until you want to pull it out as a down on the next house (https://www.finra.org & https://www.morningstar.com/bonds.html). If you're not sure about how the whole stock/bond thing works, it's best to go to a bank and talk to a financial advisor. Also, you can peruse this thread to get a feel for the lingo: https://forums.somethingawful.com/showthread.php?threadid=3259986&userid=0&perpage=40&pagenumber=933
|
|
#
?
Mar 16, 2018 19:06
|
|
|
Ixian posted:Y probably know this, but make sure you qualify for the tax exclusion (lived in it a full two years during the 5 years previous to the sale, etc.). income taxes. It's actually 5 of 8 years now, thanks to the new tax bill. And no, it doesn't grandfather you in if you bought house before thr bill. edit: nm, it looks like this change didn't make it through. I'm trying to verify that now because it was in the house and senate version, last i had checked Thesaurus fucked around with this message at 19:31 on Mar 16, 2018 |
|
#
?
Mar 16, 2018 19:23
|
|
|
|
| # ? May 1, 2024 13:25 |
|
|
Thesaurus posted:It's actually 5 of 8 years now, thanks to the new tax bill. And no, it doesn't grandfather you in if you bought house before thr bill. It didn't make it in, no. Still 2 of 5 years, and 250/500k cap.
|
|
#
?
Mar 16, 2018 19:37
|
|