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balancedbias posted:I'm confused. You are saving near 4k per month for a down payment, and you estimate that you'd need 10-20K from the IRA. Why don't you just save for the 2-5 extra months it would take to make up the difference instead of robbing from yourself? A few reasons. My wife won't have a job and it might be difficult to get one as a pregnant lady. Rent will be significantly more expensive than our current mortgage payment and the cost of living is higher. SiGmA_X posted:Especially being you're (OP) looking to move to a new market. Rent for a year or more, keep saving, and don't touch the Roth IRA. Yeah we plan on renting at first, at least for 3-6 months. Taking from my Roth IRA would only happen if it was necessary and we didn't save up enough money. I'm not sure how much we could save a month once we move which is the problem.
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Apr 5, 2015 09:08
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Closing with 10 or 15% down and just paying PMI is much better than looting your retirement accounts, seriously don't do that
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Apr 5, 2015 13:00
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You realize that the housing market in Denver is crazy now, right?
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Apr 5, 2015 17:31
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Happiness Commando posted:You realize that the housing market in Denver is crazy now, right? This. I'm not opposed to buying here, it's just a madhouse right now. http://www.denverpost.com/business/ci_27780191/denver-buyers-up-their-game-be-last-bidder-standing-real-estate-deals http://www.denverpost.com/smart/ci_27845908/denvers-housing-market-may-be-crazy-but-it Rent is also skyrocketing here, so it's lose-lose 
Thesaurus fucked around with this message at 14:46 on Apr 6, 2015 |
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Apr 6, 2015 14:44
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I have a credit card question: I have an existing card, almost a year old now, with an 18.9% APR and a $35 annual fee. I applied for a new card today, and was approved for the USAA Rate Advantage Platinum card, which has a 22% APR but no annual fees or transfer fees, a $2000 limit, and some other perks. My question is: is it worth it to keep the older card open? I barely ever use it and when I do, I always make sure to pay the balance in full and never carry a balance on it if at all possible. Does the newer card come with enough perks to justify the 4% higher APR? USAA advised me that the best thing to do at my age (I'm 25) is to keep both cards open and make a small purchase on them each month, then pay it off, because of my age I have relatively little credit history and that eventually the credit age on those cards will benefit me even if I'm paying $35/year for the older card. Is this the case? Should I be taking the long-term view on this instead of worrying about short term fees? More information: I'm 25, my credit score is 691. I have one late payment on my record from 2011 (broke rear end college student) and one account in collections that I am actively fighting because it's from an apartment complex that I moved out of more than a year ago and repeatedly verified with their accountancy department that I owed nothing when I moved out. My annual salary is $66,565 and my total credit utilization is 1% across all credit cards.
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Apr 6, 2015 22:50
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Here's what I would do: 1. Close the card with a fee. You can get cards without fees, so there's no reason to have a card with a fee. An extra year of credit history is not worth much, especially since this card will stay on your report for like seven years or something, even after you close it. If you want to have a higher total available credit, simply open up another card that has no annual fee. 2. Never carry a balance. This "if at all possible" phrasing in your post bothers me. It is always possible to avoid carrying a balance. If it isn't possible for you, that means you need a bigger emergency fund. If you aren't carrying a balance ever, then the APR doesn't matter.
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Apr 6, 2015 22:56
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If you pay your credit card in full every month you don't pay interest, so the APR is meaningless. If you cancel a credit card in good standing it remains on your credit report for ~10 years while continuing to age and contributing to your credit history. Cancelling the card will reduce your available credit, but your credit utilization is so low that it shouldn't matter. In general you want to keep your oldest credit card, but I don't think it's worth the $35 annual fee. I would call and see if the card can be converted to a different credit card without a fee, and if not just close it.
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Apr 6, 2015 22:58
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THF13 posted:If you cancel a credit card in good standing it remains on your credit report for ~10 years while continuing to age and contributing to your credit history. Could you please explain this more thoroughly? The way it's written, the account continues to age even though it's no longer open. For example, I just cancelled a Chase United card with two years of active history on it. What does that mean for the long-term?
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Apr 6, 2015 23:06
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Blinkman987 posted:Could you please explain this more thoroughly? The way it's written, the account continues to age even though it's no longer open. For example, I just cancelled a Chase United card with two years of active history on it. What does that mean for the long-term? Account in good standing despite being closed count towards your average credit history. 5 years from now your Chase United Card will still contribute to your credit history as a 7 year old account. Only after ~10 years will the account drop off your credit report.
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Apr 6, 2015 23:15
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There are three things closing your credit card affect that are directly reflected in your FICO score: Average age of accounts Credit utilization On-time payment history If you cancel a card, it will continue to (positively) affect average age of accounts and on-time payment history for around 10 years. It's going to immediately affect your credit utilization, but in the case above where the poster is immediately opening a new account, assuming this one has a comparable limit to the old one it still won't really affect it much. IE - Current card has a limit of $2K, he uses $1K at a time, his usage/credit ratio is 0.5. If the new card ALSO has a $2K limit and he continues to use $1K at a time, utilization is still 0.5 after closing the old card. So it could hurt you in the short term if your new limit is lower than the old one, but not very significantly. Your on-time payment history is far more important than this.
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Apr 6, 2015 23:24
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When I said "if at all possible" about not carrying a balance, I should note that since I've started using YNAB last year I have not carried a balance a single time. I was putting that in there to mainly be "in case of catastrophic emergency where my cash reserve buffer can't absorb it" cases, not monthly use.
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Apr 7, 2015 00:19
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Just started a new job. They have an HSA provider that charges a number of fees. I currently have an HSA through HSA Bank that I do not have any fees on since I have a bunch of money in there. They also let me trade through TD Ameritrade so I'd prefer to keep the money in there. Is it better for me to just contribute post-tax and take out more W/H exceptions for tax purposes? Or do i benefit in any way by using the HSA provider from my company? The company contributes $70 a month to the HSA.
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Apr 7, 2015 09:03
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You don't pay FICA on HSA contributions if they are directly deducted from your paycheck. That may or may not make the fees worth paying.
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Apr 7, 2015 09:55
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I picked up a copy of The Millionaire Next Door because I thought it would be a good crash course for my brother in saving responsibly. I thumbed through the first 150 pages or so, and while it's got some decent enough basics (basically amounting to "pay yourself first," "don't enable others' bad habits," and "don't keep up with the joneses"), there's also a weird anti-government bent in there. A few bits about how one of the keys to becoming rich is to pay the least amount of taxes and how the government absolutely HATES to see people keeping ahold of their money. It also places a lot of emphasis on entrepreneurship, and rather than giving statistics straight, has a lot of weird, unnecessary overexplaining. There's also about 50 pages dedicated to "don't buy too much car." At the end of the day, would not recommend, unless you're giving it to a young dumb libertarian.
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Apr 7, 2015 13:25
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Not a Children posted:I picked up a copy of The Millionaire Next Door because I thought it would be a good crash course for my brother in saving responsibly. That was my experience too. As I understand it, The Millionaire Next Door was kind of groundbreaking for its time and turned a lot of people on to spending less/smarter. But these days there are lots of different books and blogs conveying the same general idea in a much more compelling and engaging way.
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Apr 7, 2015 13:30
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I read that a couple months ago and I didn't really take away that they were really against government, it was just saying to be more efficient with your money and take advantage of tax breaks. There was a dialog between two tax collectors in it to illustrate the point, and maybe they did mean to make an anti-government statement, but I really just took away that the millionaires they surveyed all had in common that they paid a less percentage of taxes than others. Having said that, I definitely agree that it had some decent basics and seemed to have a lot of filler. It probably could have been half the length it was.
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Apr 7, 2015 13:33
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HonorableTB posted:When I said "if at all possible" about not carrying a balance, I should note that since I've started using YNAB last year I have not carried a balance a single time. I was putting that in there to mainly be "in case of catastrophic emergency where my cash reserve buffer can't absorb it" cases, not monthly use. As THF13 said I would call the credit card with the fee and see if you can downgrade to a free version. And as long as you think you can manage 2 cards, I would definitely get the USAA card. You can just put netflix or internet or something on one and setup autopay to help your payment history look good. I would definitely work on the collections thing. If you can get that remove your score should shoot up and then you would be able to get better cards that could give you free flights, hotel rooms or cash back if thats what you want.
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Apr 7, 2015 13:45
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My girlfriend had some payments that ended up in collections because they didn't send the bill to the right address - she has since posted them but they are still listed on her credit report. Any way to get them removed?
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Apr 7, 2015 14:18
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Massasoit posted:My girlfriend had some payments that ended up in collections because they didn't send the bill to the right address - she has since posted them but they are still listed on her credit report. Any way to get them removed? Probably not. You could call the original creditor and ask very nicely, but they have no obligation to do it. When I collected on credit cards, we'd do it occasionally, but it was kind of a pain, so it would have to be a good reason. Not knowing you had a bill due isn't a great reason. Probably just chalk it up as a learning experience. I suppose you could ask for validation on it and hope they don't respond, but they probably will. Someone with more experience on the other side of the equation would have to speak to that more.
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Apr 7, 2015 17:21
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If I'm applying for a lease with a SO who has bad credit (i'm guessing around 600, she is afraid to actually check), low income, and next to nothing in the bank, and I have the credit (over 800)/income (40x rent) to sign the lease myself, will having her applying with me actively hurt or am I better off just applying solo? Is there anything I can do with an 8 month lead to get her in shape (already have plans in order to wipe out existing credit and get her debt free before the end of the year)?
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Apr 7, 2015 17:54
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The pragmatist in me says sign the lease yourself, help her work on her credit, and if she can't learn financial good sense, looks like you have your own nice place!  Take this with a grain of salt as I broke up with someone in the past year partially because their lifestyle was out of control in relation to their earnings.
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Apr 7, 2015 19:11
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Not a Children posted:There's also about 50 pages dedicated to "don't buy too much car."
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Apr 7, 2015 19:19
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Nephzinho posted:If I'm applying for a lease with a SO who has bad credit (i'm guessing around 600, she is afraid to actually check), low income, and next to nothing in the bank, and I have the credit (over 800)/income (40x rent) to sign the lease myself, will having her applying with me actively hurt or am I better off just applying solo? Is there anything I can do with an 8 month lead to get her in shape (already have plans in order to wipe out existing credit and get her debt free before the end of the year)? It's going to depend. Read the lease! Most of the leases I've signed didn't allow people to live there who were not on the lease ("living there" is defined in the lease, like two consecutive weeks). I had one place require everyone on the lease to make 3 times the rent unless you were married. At the time my now wife was only my fiance (or maybe GF) and she was out of a job. Most places just wanted the combined income of everyone on the lease to be 3 times. If the lease requires her to be on it make sure she is. A 600 isn't that bad and as long as they don't require her to make 3 times the rest you should have no problems.
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Apr 7, 2015 19:24
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Yea, you might not have a choice about including her or not (unless I guess you want to lie, have her move in anyway, and hope that the landlord doesn't notice/care/do anything about it.) If your income is actually 40x the rent then I doubt you will have any issues, because even if she proves to be unreliable and broke they will always come after you instead.
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Apr 7, 2015 19:30
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Synchrony Bank just redesigned their website in the last couple days (I'm usin em for the 1% APY savings account). It looks a lot less lovely than it used to!
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Apr 7, 2015 19:48
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Mocking Bird posted:The pragmatist in me says sign the lease yourself, help her work on her credit, and if she can't learn financial good sense, looks like you have your own nice place! The amount in total is pretty insignificant and was just something that got out of control and "maybe if I ignore it it will go away". I have enough in my checking to make it all go away, but she is doing it to learn how to budget and whatnot. There is no underlying lifestyle issue, hell the debt is mostly refusing to eat crappy food while unemployed. gariig posted:It's going to depend. Read the lease! Most of the leases I've signed didn't allow people to live there who were not on the lease ("living there" is defined in the lease, like two consecutive weeks). I had one place require everyone on the lease to make 3 times the rent unless you were married. At the time my now wife was only my fiance (or maybe GF) and she was out of a job. Most places just wanted the combined income of everyone on the lease to be 3 times. Yeah, I will be reading the lease pretty thoroughly to begin with for pet related reasons. My current lease was the signers needed to make 40x the monthly rent the year before, don't think there is any stipulation about living though. Will have to see what the terms are when we're looking. I honestly don't know what her rating is, she is afraid to look because she thinks there might be a medical bill on there that got lost somewhere in time - to my knowledge there is one credit card that went to collections for a relatively insignificant dollar amount that she will have remedied before the end of 2015 and no student loan/other debt. Ashcans posted:Yea, you might not have a choice about including her or not (unless I guess you want to lie, have her move in anyway, and hope that the landlord doesn't notice/care/do anything about it.) If your income is actually 40x the rent then I doubt you will have any issues, because even if she proves to be unreliable and broke they will always come after you instead. We want her to be on the lease simply from the my place vs our place perspective. The concern is that she will be actively hindering our search when I could feasibly apply solo (unless our budget creeps north because why not).
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Apr 7, 2015 21:20
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It's not going to matter for your search if you qualify on your own, but you (and the landlord) definitely want her on the lease.
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Apr 7, 2015 22:04
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pig slut lisa posted:That was my experience too. As I understand it, The Millionaire Next Door was kind of groundbreaking for its time and turned a lot of people on to spending less/smarter. But these days there are lots of different books and blogs conveying the same general idea in a much more compelling and engaging way. It was a significant piece of research at the time. I bought it when it first came out but the essential parts you can find on wikipedia. I think the ideas have been refined over time and when you mix those ideas with The Four Pillars of Investing, and a less extreme version of MMM, you end up with a reasonable way to lead your life while looking after your finances. Passive income and financial independence are popular ideas at the moment.
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Apr 8, 2015 00:48
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Ughhh son of a bitch i had a credit card for a dentist that i never went to get closed automatically with a zero balance and it cost me 40 pts on my report. Will opening a secured credit card (since i dont qualify for anything else) offset this change in my used to unused credit? Assuming i keep a 20pct balance on it? That 40 points washed away 2 years of gains Also - how do you track down a reputable credit counselor? Im not underwater and i can afford to throw money at the problem, my main issue is my credit score. Edit: maybe credit repair service is what i want? cr0y fucked around with this message at 12:40 on Apr 8, 2015 |
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Apr 8, 2015 12:24
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cr0y posted:Ughhh son of a bitch i had a credit card for a dentist that i never went to get closed automatically with a zero balance and it cost me 40 pts on my report. Will opening a secured credit card (since i dont qualify for anything else) offset this change in my used to unused credit? Assuming i keep a 20pct balance on it? That 40 points washed away 2 years of gains Do Not Carry A Balance. It does not help in any meaningful way. There is nothing a credit counselor can do for you that you can't do yourself. Do you have open collections, a bad payment history..? What are your problems?
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Apr 8, 2015 14:33
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And why do you care about your credit score right now?
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Apr 8, 2015 15:33
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How much rent can we afford? We're moving to a higher COL area and going from 2 cars to 0 cars, so our budget is obviously changing a lot. Basically we're trying to decide what balance we should strike between monthly savings/cashflow and getting a nicer/bigger/safer place. For reference, this is a two adult, single income, no kids (ever) household with no debt and decent credit. No cars, walking distance to school, work, groceries, gym. I've tried to overestimate what I expect our costs to be. Monthly income: $3400 (after insurance, 401k, HSA deductions) Near-term liquid savings: $20 000 (for his school) Emergency fund: $12 000 Projected Budget: Savings $460 his IRA $460 her IRA $??? monthly cashflow, to be saved ------------------------------------------------ $920 + savings Bills $???? rent $100 electricity (max, assuming less during milder weather) $50 water/trash/sewer/etc. $50 internet $40 cell phones ------------------------------------------------ $240 + rent Other Recurring Expenses $350 groceries $50 public transit $80 two gym memberships $100 misc (clothes, shoes, household items, occasional car rentals etc.) ------------------------------------------------ $580 Discretionary Expenses $100 hers $100 his ------------------------------------------------ $200 Total: $1940 + rent + savings So that means that we have $3400 - $2040 = $1460 to divide between rent and savings/leftover at the end of the month money. How much rent can we afford? It seems like the cheapest places bottom out around $850, but those are like 350 sq ft in bad neighborhoods with no secured access and lovely appliances. The place we liked best rented for around $1150-1200. Can we afford that place? SHOULD we afford that place?
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Apr 8, 2015 19:30
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Looking at your budget, I don't see any reason why you couldn't afford $1200 a month in rent. The only issue I see is that if 1 of you doesn't have a job, you can't contribute to an IRA or Roth IRA.
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Apr 8, 2015 19:53
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A general rule is rent + transportation should be around 40%, so you're good to go if I'm looking at this right.
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Apr 8, 2015 19:54
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I've read it numerous times here that housing + transportation should be no more than ~40% of your monthly net income, and I find that to be a good guideline. For your situation, that's $1340, which should include rent, insurance, and utilities. Since you've already done the math on utilities and public transport, you can afford ~$1090/month in rent. $1150-1200 is above that, but not by enough that should cause any real problems.
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Apr 8, 2015 19:57
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Your misc category, based on what you assigned to it, seems light to me for two people. Other than that, you should be pretty good to go at 1200.
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Apr 8, 2015 20:08
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T. J. Eckleburg posted:Can we afford that place? SHOULD we afford that place?
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Apr 8, 2015 20:22
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Two people living in 350sf sounds brutal. I live with my girlfriend in just under 600 and it can be a little tight.
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Apr 8, 2015 22:56
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KYOON GRIFFEY JR posted:Two people living in 350sf sounds brutal. I live with my girlfriend in just under 600 and it can be a little tight. Right now we have 3 people in 800, which is ok. 2 in 350 does sound really tough. zamin posted:I've read it numerous times here that housing + transportation should be no more than ~40% of your monthly net income, and I find that to be a good guideline. OK. That's a good guideline to keep in mind. KYOON GRIFFEY JR posted:Your misc category, based on what you assigned to it, seems light to me for two people. Other than that, you should be pretty good to go at 1200. I based that on what we've spend in that category over the last six months, minus car-associated expenses. Thanks for the suggestions, everyone. I think I have a better idea of what's reasonable now. Hashtag Banterzone posted:Looking at your budget, I don't see any reason why you couldn't afford $1200 a month in rent. We're married, is this still true? I really hope not!
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Apr 9, 2015 02:11
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T. J. Eckleburg posted:We're married, is this still true? I really hope not!
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Apr 9, 2015 02:15
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