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Kilo India posted:Where do you save money that you plan on spending? I was wondering the same thing but with different circumstances. I put around 3k in both my 401k and my Roth IRA but I'm also saving up to buy a car in 5 years and a house down payment in around 10 years. I can't do short term investing including peer to peer loans due to my job. Savings account or low risk investment or something else?
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Sep 21, 2013 02:45
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I've actually had a Lending Club account for about five years now and I've averaged a return of 11 percent. I love it but I consider it one of my riskier investments and not something I'd funnel money I actually need into. For one, the volume simply isn't there. There have been times I've dumped only $500 in and found it doubling up on notes because there aren't enough available to properly diversify my order.
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Sep 21, 2013 03:41
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I am doing this wrong? I've set myself a budget over past few years, got a new job that brought more money and now I've got a whole lot of money saved up - I could pay off 3/4th of all my debt - student loans. In the past I was really bad with money and I obviously learned my lesson. Granted, I wouldn't want to spend all of it but something tells me that I've got too much money? Advice?
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Sep 21, 2013 04:41
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Tab8715 posted:I've got too much money? Advice? Give it away to the people in this forums that don't have enough. Solves two problems.
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Sep 21, 2013 05:08
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Zeta Taskforce posted:Stop treating your finances like a game, stop taking the easy way out, live below your means, use debt sparingly, establish an emergency fund so future hardships don't turn into a crisis.
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Sep 21, 2013 05:11
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Tab8715 posted:I am doing this wrong? You should have ~6 months of spending in a fairly-liquid emergency fund, because poo poo happens and it helps to be prepared. Beyond that, I would put the excess towards paying down student loans (if they're more than 4-5%) and/or maxing out your retirement contributions. If you're still bringing in money hand over fist after those are both taken care of, then you should look into investing and charitable giving.
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Sep 21, 2013 05:19
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Question regarding credit rating: My credit rating is getting really damaged because went my student loans went off forbearance several years ago, I didn't notice it until I was 60+ days behind. I got in touch with FedLoan and resolved the issue, and I'm current on payments and having no difficulties with them. The problem is that because there were eighteen separate loans, I now have eighteen negative accounts on my credit report, all stemming from the same issue. Is there anything that can be done about this, in the sense of asking FedLoan to have the negative reporting removed, or am I just screwed for the next five years?
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Sep 21, 2013 19:03
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Tab8715 posted:I am doing this wrong? Save 6-12 months of liquid emergency fund, start accounts to pay for future necessities (car/house/helicopter), then start saving towards 30x annual income for retirement. You don't have close to enough money, but you're on the right track 
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Sep 21, 2013 21:26
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Unormal posted:Save 6-12 months of liquid emergency fund, start accounts to pay for future necessities (car/house/helicopter), then start saving towards 30x annual income for retirement. You don't have close to enough money, but you're on the right track Yup - sounds like I've got my 6-Months savings plus extra but did you arrive at 30x?
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Sep 22, 2013 05:17
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Tab8715 posted:Yup - sounds like I've got my 6-Months savings plus extra but did you arrive at 30x? When properly invested you should be able to withdraw 4% of your retirement savings per year and not run out of money. In order to find out how much you need you take your spending and divide by .04 to get this number. Dividing by .04 is the same as multiplying by 25. It is slightly safer to have some sort of margin so you'll hear 25-30x get tossed around.
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Sep 22, 2013 05:57
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Don't forget that your expenses will likely drop in retirement. First, you won't have to save for retirement! Second, most will have their mortgages and student loans paid off already. Third, it costs a lot of money to go to work everyday: gas, wear and tear, lunch, nice clothes, that you won't have to pay anymore. Better to figure out how much income you want during retirement first. Most recommend about 2/3 your current salary, if you want the same standard of living. 4% is a commonly thrown around number. But that's already very conservative. Assuming you retire at 65 and plan to die at 100, and are getting a 4% return on your investments. That comes out to about $18,600 of principle required for every $1000 of annual withdrawal. Or about 5.3%.
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Sep 22, 2013 12:25
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CarterUSM posted:Question regarding credit rating: I'm not sure there is too much you can do, seeing how this was accurate reporting on their part, and ultimately you are responsible for ensuring that all your accounts stay current. You could try disputing it through the credit bureaus and say that these 2 months they should have been in forbearance, maybe you will get lucky. That said, time does heal all credit wounds. If it was several years ago and you have never been late with anyone since, a lot of the damage has already been mitigated. Your credit history is heavily weighted over the most 2 recent years, and accounts that were late and brought back look better than collection accounts and charge offs. You might still be locked out of a credit given on the best terms, so all the smart things we always say about avoiding debt, paying off what you have, budgeting, having an emergency fund, saving for future big ticket items to avoid big chunks of debt later on, all this stuff is even more important for you.
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Sep 22, 2013 16:27
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I have a question regarding credit card payments. What is the most beneficial way to pay my bill for improve my credit score? My bill itself is not high, neither is the limit on the card. The card i have is strictly to help my credit score. I am not concerned about using it since i would never spend money again that i cant pay off, that got my credit score in a bad place to begin with. If i say charge $75 dollars a month and the minimum due is $40. Is it better for me to pay off the full amount leaving no balance on the card, or just the minimum showing i complied with what was asked and the account is in good standing? Sorry if this is a stupid or basic question.
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Sep 23, 2013 08:06
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From the OP (and prior thread title): How can I improve my credit score? Should I keep a balance? Never keep a balance...
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Sep 23, 2013 08:38
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I'm going to join all the people here asking for financial advice in their relationships. My girlfriend moved in with me about a month ago, and she's pretty badly in debt. She only works part time and basically even with me not asking her for any household expenses, she's barely making minimum payments. Most of it is student loans, I'm not sure how much but it's probably five figures at around 6%. She's still got a couple years left in grad school though, so those are in deferment (although apparently some still collect interest). That's less of a concern though, next to her credit card debt. I'll be getting more details from her tonight, but it's about $4500 at something like 15% interest. She's pretty responsible with her money, but the credit card debt is mostly from school expenses. We've been talking, and I'm worried about her debt getting worse if something isn't done about it now, so I'm considering paying off her credit card with either my savings or from my HELOC (3.5% and tax deductible). The main thing I'm worried about is how to handle something like this without it building any sort of weirdness or resentment into the relationship. I think we'd probably both feel most comfortable if it was an officially documented loan with a term and minimum payments.
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Sep 23, 2013 14:39
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SlightlyMadman posted:I'm going to join all the people here asking for financial advice in their relationships. My girlfriend moved in with me about a month ago, and she's pretty badly in debt. She only works part time and basically even with me not asking her for any household expenses, she's barely making minimum payments. Most of it is student loans, I'm not sure how much but it's probably five figures at around 6%. She's still got a couple years left in grad school though, so those are in deferment (although apparently some still collect interest). That's less of a concern though, next to her credit card debt. I'll be getting more details from her tonight, but it's about $4500 at something like 15% interest. In the end, really only you can gauge whether it is a good idea or not. That being said, unless you have been dating for 10 years, if you have only just moved in together I would question whether you are at that stage of trust in a relationship. It sucks to be negative, but if the relationship goes sour at that point that will be a big needlepoint for fights, and to be honest if you ever break up you're out $5,000+. That's a good chunk of change. And personally, while documenting is a nice idea in theory, I can't see it doing anything but causing resentment long term for the same reasons. I would question how responsible she actually is with money. From what I've seen, most people THINK they are good with money, yet its still so easy to get in debt, take short term shortcuts, etc. I personally have that happen personally, so I can relate. Honestly, the only way to fix it is to find monthly cost cuts wherever possible, and have her start paying it off slowly but surely. I think she would feel better long term paying it off herself rather than you paying it (even sans the 0% interest i assume you would give her). And end of the day, painful financial lessons/experiences at least help (but not guarantee) ensure that it won't happen again.
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Sep 23, 2013 14:51
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SlightlyMadman posted:I think we'd probably both feel most comfortable if it was an officially documented loan with a term and minimum payments.  DON'T DO THIS!!!Seriously, I know you want to help, but how much weirdness do you want in your life? You are going to play banker to your live in girlfriend? What happens if she is late and can't make the minimum payments to you? She barely has an income now from being in school and trying to keep up with everything. If she is struggling to pay Bank of America, why will she not struggle to pay you? What happens when she comes back with a new haircut, or wants to go out with the girls on a Friday night? Will you wonder how much money she spent? What if she wants to do these things and doesn't because of these unspoken cross currents in the relationship, she sees you spending money on yourself, and she grows resentful of you, but she can't put her finger on why, and like every other guy you are bad about reading her thoughts? If she just moved in, it is too early to combine your finances. But your job in the meantime is to cover all the household expenses and make her life as easy as possible for the next two years so she does finish, and to continue to improve your own finances so if she is the one, you can pay off all her debt, or a lot of it when you do finally get married. At that point it isn't her debt, it is yours too. You can choose between having a girlfriend, or being able to deduct your interest. This is one of those times when you can't have your cake and eat it too. I'm curious what other people think.
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Sep 23, 2013 15:00
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SlightlyMadman posted:The main thing I'm worried about is how to handle something like this without it building any sort of weirdness or resentment into the relationship. I think we'd probably both feel most comfortable if it was an officially documented loan with a term and minimum payments. Its a terrible idea. Loaning money to anyone you care about nearly always ends badly. Just giving her money is much better than some sort of loan. That said, I'd just keep your finances as separate as possible. "Moved in together" does not give you any legal way to get back money you put into the relationship if it doesn't work out. Is marriage in the immediate future? If not, her money problems are not yours to fix. If so, just wait until you actully are married to take on her debts.
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Sep 23, 2013 15:01
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Duckman2008 posted:In the end, really only you can gauge whether it is a good idea or not. That being said, unless you have been dating for 10 years, if you have only just moved in together I would question whether you are at that stage of trust in a relationship. It sucks to be negative, but if the relationship goes sour at that point that will be a big needlepoint for fights, and to be honest if you ever break up you're out $5,000+. That's a good chunk of change. And personally, while documenting is a nice idea in theory, I can't see it doing anything but causing resentment long term for the same reasons. Yeah, I'm just looking into options at this point, but ultimately I'll have to make the decision of whether or not I'm comfortable with it. I don't mean to be a dick because I know you're just being helpful here, and I do appreciate it, but honestly that decision is my business and I'm not really looking for input in that area. What would be really useful is if there was a third-party organization like lending club or something that I could go through to make it an actual official loan.
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Sep 23, 2013 15:03
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Ok, let me rephrase this question because I obviously hit an internet nerve here: "If I wanted to lend somebody else money as if I was a bank, are there any resources out there for doing so?"
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Sep 23, 2013 15:07
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SlightlyMadman posted:I don't mean to be a dick because I know you're just being helpful here, and I do appreciate it, but honestly that decision is my business and I'm not really looking for input in that area. You asked for an opinion on a public forums, and quite frankly that is a bigger factor than the money. Also: SlightlyMadman posted:What would be really useful is if there was a third-party organization like lending club or something that I could go through to make it an actual official loan. Zeta Taskforce posted:
DemonLlama posted:Its a terrible idea.
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Sep 23, 2013 15:08
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Yeah, sorry I should have phrased my question better. Thanks everyone for your input, I'll just google it some more.
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Sep 23, 2013 15:15
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SlightlyMadman posted:Yeah, sorry I should have phrased my question better. Thanks everyone for your input, I'll just google it some more. The issue isn't how you phrased your question. You are going to do it anyway, so good luck. Tell us in a year how it worked out. Enjoy your tax deduction. The English language has a word that describes the exchange of money for certain other services that adults can do for other adults. If you're not careful, your relationship will look like that. How about this? Treat her as an equal. You know what she has, she knows what you have. You make a budget for you so she knows what you are doing, she makes a budget too, you help her with it, but it represents her resources and priorities. You can make a mock one for what will happen when you are married. But don't treat her as a problem to fix. Or do, but it's not my life.
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Sep 23, 2013 15:25
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Zeta Taskforce posted:The issue isn't how you phrased your question. You are going to do it anyway, so good luck. Tell us in a year how it worked out. Enjoy your tax deduction. The English language has a word that describes the exchange of money for certain other services that adults can do for other adults. If you're not careful, your relationship will look like that. That's not remotely related to what I was asking, but thank you for the input.
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Sep 23, 2013 15:29
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Sorry the answer to "How do I best loan money to my girlfriend?" is "Don't". Lose your lovely attitude  vvv Any time. lament.cfg fucked around with this message at 16:11 on Sep 23, 2013 |
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Sep 23, 2013 15:39
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Me in Reverse posted:Sorry the answer to "How do I best loan money to my girlfriend?" is "Don't". Lose your lovely attitude Thank you for your input. edit: Just following up because I realized I am still coming off as a dick and don't intend to. When I say I appreciate the input, I do mean it and there's absolutely good advice being given here. The reason for my dismissive tone is that I've already thoroughly thought about all of this, and it's just distracting from the actual question I'm trying to ask. This is really my fault because I was distracted with work when I was typing out my post and phrased it very badly. I appreciate the input, it's all very good advice. Let's all just move on please. SlightlyMadman fucked around with this message at 16:19 on Sep 23, 2013 |
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Sep 23, 2013 16:06
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SlightlyMadman posted:Thank you for your input. Edited out Zeta Taskforce fucked around with this message at 16:44 on Sep 23, 2013 |
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Sep 23, 2013 16:28
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Ok, I apologize again for my attitude, but there's no need to resort to personal attacks like that.
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Sep 23, 2013 16:39
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Zeta Taskforce posted:Edited out Oh, gently caress you, it was funny. [Zeta posted a shaggy dog version of "save a bunch of money, blah blah, some day it'll be alimony"] To be serious: Loaning a bunch of money to your girlfriend is inherently an E/N subject, not a business decision. Loaning money to family/friends never goes well. It creates inequality in the relationship and leads to mutual resentment for a plethora of reasons. Go to loving LegalZoom or something if you really want paperwork for 'a real loan', but don't come back in a year asking us to fix your budget because you're out a bunch of cash from your ex-girlfriend.
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Sep 23, 2013 16:45
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It was kind of funny actually. One day I'll learn not to take anything personally that's said to me on the internet. If anyone is still curious, since I've been unable to find any sort of third-party service that would make something like this more official, I'll probably just give her the money (from my savings, not on the HELOC) as an early Christmas present and leave it at that. Now that I'm over being offended at the unsolicited relationship advice, I see the point that is being made here, which is that the thing I was asking whether or not it exists does not exist, so ultimately I do really appreciate the advice here and it's proven quite helpful.
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Sep 23, 2013 16:50
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If that's what you want to do, I wholly support gifting her the money rather than "A FORMAL LOAN".
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Sep 23, 2013 16:52
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SlightlyMadman posted:It was kind of funny actually. One day I'll learn not to take anything personally that's said to me on the internet. Well, I can put it back, but I felt you were beat up enough. The thing that all of us have been trying to impress upon you is that money and the relationship are inseparable, and you would do well to listen to both.
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Sep 23, 2013 17:03
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Me in Reverse posted:If that's what you want to do, I wholly support gifting her the money rather than "A FORMAL LOAN". Yeah, I'm fairly certain that will be my decision now, but I'll talk it over with her of course. The main reason I was thinking about a loan instead is that I'm not sure she'd actually accept that large of a gift, but ultimately I think that's the only option and if she's not comfortable with it as a gift then that will be the end of the discussion. She'll pay it down herself eventually, she's just paying a fortune in interest and that bothers me, but it's not my responsibility. In a perfect world, I'd love it if I could walk into a bank and deposit the money into an account that they'd use as collateral to issue a cash-secured loan. If she paid it back, I'd get the collateral back, and if she defaulted the bank takes out the balance and pays me back anything that's left over. I can understand why this doesn't exist though, because the bank couldn't make nearly enough off something like that to be worth it to them. Apparently Virgin tried to start up something like this but it failed. edit: To be clear, even if that did exist, I see that it would still be a bad idea. Ultimately, I can either afford the money as a gift or I can't. If I can, I should just give it freely, and if I can't I shouldn't be giving it at all. SlightlyMadman fucked around with this message at 17:08 on Sep 23, 2013 |
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Sep 23, 2013 17:03
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SlightlyMadman posted:I'm going to join all the people here asking for financial advice in their relationships. My girlfriend moved in with me about a month ago, and she's pretty badly in debt. She only works part time and basically even with me not asking her for any household expenses, she's barely making minimum payments. Most of it is student loans, I'm not sure how much but it's probably five figures at around 6%. She's still got a couple years left in grad school though, so those are in deferment (although apparently some still collect interest). That's less of a concern though, next to her credit card debt. I'll be getting more details from her tonight, but it's about $4500 at something like 15% interest. If they're Stafford Loans or Direct Loans through the government, tell her to enroll in IBR (Income Based Repayment).
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Sep 23, 2013 17:49
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TotallyMadman, just gift it to her. If she pays you back, sweet. Trust me. My gf and I went though this with a far smaller amount than 15k in loans (400ish) and I gifted it to remove the line item from my mental register. When she gifted it back to me in full (plus $6 I believe!) that was awesome, and unexpected. She said she would repay all along, but the only way to make it work in my mind was a gift. E: Write up a loan repayment document if you are really crazy enough to do it as a loan. I wouldn't tho. And put your HELOC payment into YOUR budget not hers. Taking a HELOC to pay off your not wife's debt seems really dumb btw... Take cash out of your short term savings (not emergency fund) and don't take on debt to pay off someone else's debt.
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Sep 23, 2013 17:51
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SiGmA_X posted:TotallyMadman, just gift it to her. If she pays you back, sweet. Trust me. My gf and I went though this with a far smaller amount than 15k in loans (400ish) and I gifted it to remove the line item from my mental register. When she gifted it back to me in full (plus $6 I believe!) that was awesome, and unexpected. She said she would repay all along, but the only way to make it work in my mind was a gift. Thank you, yeah I think I'm going to do precisely what you're saying here. I give her the money as a gift (again, not from the HELOC, that was just a side-thought that I didn't really think through and shouldn't have mentioned; my point was more how easily I could beat the interest rate she was getting if needed), assuming she's comfortable with that, and if she wants to give me a gift of equal value at some point that will be nice but I'll have written the money off and not expect it.
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Sep 23, 2013 18:17
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SlightlyMadman posted:The main reason I was thinking about a loan instead is that I'm not sure she'd actually accept that large of a gift, I'm going to suggest another course of action for the time being. Do nothing. She just moved in, she is getting use to her new routine, she moved at the same time that she is keeping up with grad school and working on top of that, she probably feels self-conscious that she isn’t able to contribute as much as you can toward this new household. She probably wants to hold onto some type of dignity and receiving that large of a gift right now, so soon after moving in, probably gives her pause. The loan in theory helps her preserve the dignity because in her mind, no money actually changed hands, and you being the nerd can see why this makes mathematical sense. We have beaten to death why this is a bad idea. If I were you, you both should get used to each other, prove to her that you are real, and she will realize that gifts from you are really gifts and they won’t be trotted out later when you want something. In the meantime you can both work out a plan that prevents her from going further into debt. I know you want to go in and fix things, and you are doing this from a good place in your heart.
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Sep 23, 2013 18:28
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Zeta Taskforce posted:I'm going to suggest another course of action for the time being. Do nothing. She just moved in, she is getting use to her new routine, she moved at the same time that she is keeping up with grad school and working on top of that, she probably feels self-conscious that she isn’t able to contribute as much as you can toward this new household. She probably wants to hold onto some type of dignity and receiving that large of a gift right now, so soon after moving in, probably gives her pause. The loan in theory helps her preserve the dignity because in her mind, no money actually changed hands, and you being the nerd can see why this makes mathematical sense. We have beaten to death why this is a bad idea. I appreciate this, it's an excellent point. I have no plans on anything right away, our plan was to sit down and talk it over tonight once she got her paperwork together so I can see exactly what her debts are and if it's as bad as it's been sounding to me. I think now that my perspective has shifted to viewing this as a gift instead of a loan, I'll start over the discussion from that standpoint and see what she thinks.
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Sep 23, 2013 18:50
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INTJ Mastermind posted:Don't forget that your expenses will likely drop in retirement. First, you won't have to save for retirement! Second, most will have their mortgages and student loans paid off already. Third, it costs a lot of money to go to work everyday: gas, wear and tear, lunch, nice clothes, that you won't have to pay anymore.
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Sep 24, 2013 00:56
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SlightlyMadman posted:I'm going to join all the people here asking for financial advice in their relationships. My girlfriend moved in with me about a month ago, and she's pretty badly in debt. She only works part time and basically even with me not asking her for any household expenses, she's barely making minimum payments. Most of it is student loans, I'm not sure how much but it's probably five figures at around 6%. She's still got a couple years left in grad school though, so those are in deferment (although apparently some still collect interest). That's less of a concern though, next to her credit card debt. I'll be getting more details from her tonight, but it's about $4500 at something like 15% interest. Is there anything you can help with instead of giving her 5k in one shot? My wife (girlfriend at the time) covered groceries when I moved in with the expectation that I would use that breathing room to pay off my student debt faster, and I did. There was no weirdness and with me paying off my own debt still I kept my dignity, confidence, and sense of responsibility fully intact. And I'm not saying your girlfriend can't be trusted, but what if you give her 5k and she racks up more? You already say she's not making any household payments which worries me because what if you weren't around? Is taking off the credit card debt going to help that much that she will then surely be financially disciplined?
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Sep 25, 2013 03:23
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