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The Mandingo posted:My wife is a recent graduate and (hopefully) will have a full-time teaching position for next school year. We're doing fine financially, and slowly paying off debt on one income. We will be killing it with two incomes. In what order should I squash these three debts? Avalanche method would mean attacking student loan 2. That would save you the most money and after repaying it you would free up $125 per month. Snowball method you would pay off the smallest first with student loan 1 and then the car which would free up $285 per month in minimum payments, less to administer but you would still have the 9.99% interest loan there in roughly the same period of time. Having less bills and payments to worry about is good. This is assuming you can pay off the car loan earlier (depends on the conditions of the loan). Both are good options but a car loan at 2.54% isn't that bad especially with payments high enough to pay a decent amount of the loan principle each month. You could just focus entirely on the student loans in any order and you would be significantly better off in the long run. e: Just so you know if you keep making the car payments for 2.75 years when it'd be paid off the total interest you'd pay is about $272. Paying the student loans first will save a heck of a lot more than that. Devian666 fucked around with this message at 03:22 on Jun 5, 2015 |
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Jun 5, 2015 03:06
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Xenoborg posted:Biggest interest first gives you more total money. Psychologically, it can help people pay off debt to do it other ways to check things off or reduce their monthly, but it sounds like you are doing fine on that front. I'd go for highest interest, but everyone is different. I hate giving away my money, which is you do more of with higher interest rates.
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Jun 5, 2015 03:55
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Whats the turn around time like on a Citi credit card application? I applied for one almost 3 weeks ago and haven't heard anything. Site said they would email me within a week. Wondering if I should redo it.
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Jun 5, 2015 13:52
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Call them, you should have heard by now.
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Jun 5, 2015 14:20
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The Mandingo posted:My wife is a recent graduate and (hopefully) will have a full-time teaching position for next school year. We're doing fine financially, and slowly paying off debt on one income. We will be killing it with two incomes. In what order should I squash these three debts? I'm going to offer a slightly different approach than most would. Knock out the Student Loan 1 first. It's only $3,000 but is a high APR. This will give you a psychological boost for getting rid of one debt, then you can focus on loan #2. I would get the car last, as it's got a pretty low interest on it.
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Jun 5, 2015 14:59
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I feel like this is an incredibly obvious question, but how do you invest in a CD or bond? Is it possible to do this entirely online? The only explicit directions I've ever received were to set up an etrade account and buy a corporate bond through that. EDIT: I guess I just pick a service provider and follow their individual directions, paying attention to fees, correct? legsarerequired fucked around with this message at 16:30 on Jun 5, 2015 |
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Jun 5, 2015 15:39
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legsarerequired posted:I feel like this is an incredibly obvious question, but how do you invest in a CD or bond? Is it possible to do this entirely online? The only explicit directions I've ever received were to set up an etrade account and buy a corporate bond through that. CDs are generally offered by banks and you probably need an account at the bank to buy one. There should be no fees to purchase the CD though there are penalties, loss of some or all the interest, if you withdraw the money early. Unless you can find a CD with abnormal rates they really aren't worth it right now as certain savings accounts give about the same return with access to the funds, Bonds are normally bought through a brokerage account, ETrade offers them as do other brokers, and you would buy through them with a fee per trade. I would probably not recommend buying specific bonds and instead buy an ETF or a mutual fund that is diversified among multiple companies and maturities.
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Jun 5, 2015 16:40
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Nocheez posted:I'm going to offer a slightly different approach than most would. Knock out the Student Loan 1 first. It's only $3,000 but is a high APR. This will give you a psychological boost for getting rid of one debt, then you can focus on loan #2. I would get the car last, as it's got a pretty low interest on it. I've seen a bunch of student loans that have a minimum payment of $50 if the calculated minimum payments are less than $50 for the standard 10 year term. I bet #2 has an actual minimum payment less than that. If so, the OP is already paying extra towards the principal on loan #2
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Jun 5, 2015 18:15
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I've decided to start saving a few hundred a paycheck in an Ally savings account that pretty much won't be tapped unless I lose my job or if I'm wrongfully accused of murder and I know I've been skillfully framed and I need to skip the country. I think I'd like to take maybe half or more of what I'm putting in the savings account and do something higher-risk higher-reward. Putting money in a mutual fund sounds appealing, but a bit overwhelming. I don't quite understand it. If it's not a retirement account, I can cashout anytime, right? I also don't quite understand the tax implications. If the mutual fund is profitable for the year, I owe money on that even if I don't withdraw? What if I change nothing and it loses money the following year, I'm still out what I paid in taxes?
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Jun 5, 2015 19:04
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Is this the same thing as your emergency fund? If so, you should NOT be investing it in anything other than a high-yield checking/savings account. The loss in returns is the price you're paying for liquidity, which is the whole point of this rainy day fund. If you already have an emergency fund and don't feel it's adequate, simply add to it instead. The rest that's not going to blow and hookers should be sent to tax-advantaged retirement savings, unless you've already maxed those?
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Jun 5, 2015 20:06
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asur posted:CDs are generally offered by banks and you probably need an account at the bank to buy one. I see! I honestly can't even buy a CD right now because my cash savings are so low (or I guess I could, but it wouldn't be worth it). It just really bugged me that I didn't know how to. I clicked around Bank of America's website and Ally Bank and found how to do it, which is super helpful. This question might be more appropriate for the long-term investing thread, but I feel like they're more advanced than me... How can you tell if your roth IRA is performing at an acceptable level? I've been losing money all summer, and I'm not sure how I would compare this to see if there's something I should change with the funds or if it's just how the market is performing.
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Jun 5, 2015 20:25
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totalnewbie posted:Is this the same thing as your emergency fund? If so, you should NOT be investing it in anything other than a high-yield checking/savings account. The loss in returns is the price you're paying for liquidity, which is the whole point of this rainy day fund. Well, I already have an adequate emergency fund. Whatever I'm putting into savings now is just padding. I don't have a retirement account. I don't want to age-lock my money. I'm only 24, I'd be extremely surprised if society doesn't collapse or I don't kill myself by age 60. I want to put money somewhere I can watch it go up and down, but I don't want to put my eggs in too few baskets with individual stocks. It sounds like a mutual fund is exactly what I want.
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Jun 5, 2015 20:30
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legsarerequired posted:This question might be more appropriate for the long-term investing thread, but I feel like they're more advanced than me... How can you tell if your roth IRA is performing at an acceptable level? I've been losing money all summer, and I'm not sure how I would compare this to see if there's something I should change with the funds or if it's just how the market is performing. You would compare it to a relevant benchmark, which may not be trivial to find. A quick comparison would be to the S&P 500, but if your allocation doesn't reflect the same risk then it's not really accurate. The market has been pretty flat for the past month and a half and is only up 2% YTD. In the short term, return should probably be ignored as the market fluctuates a lot. I'd pick an allocation using index ETFs or mutual funds and then basically ignore return as the funds you pick will track the index. If you post your allocation, the thread can probably give more advice.
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Jun 5, 2015 20:40
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jarjarbinksfan621 posted:If it's not a retirement account, I can cashout anytime, right? Correct. jarjarbinksfan621 posted:If the mutual fund is profitable for the year, I owe money on that even if I don't withdraw? No, you only owe taxes if you've sold shares that have gained value. And you'll only owe taxes on the profit. So if you buy into a fund that costs $100/share, and later you sell when it's $150/share, then only the $50 counts as taxable income (capital gains tax). Also, if it goes down to $75, then I think you can write off $25 on your taxes as a capital loss. edit: also, the amount of tax you pay depends on how long you held the stock. If it's less than one year, it's short-term capital gains, and if it's longer, then it's long-term capital gains. Each of these have different tax rates. Super Dan fucked around with this message at 21:05 on Jun 5, 2015 |
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Jun 5, 2015 21:01
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jarjarbinksfan621 posted:Well, I already have an adequate emergency fund. Whatever I'm putting into savings now is just padding. I don't have a retirement account. I don't want to age-lock my money. I'm only 24, I'd be extremely surprised if society doesn't collapse or I don't kill myself by age 60. I want to put money somewhere I can watch it go up and down, but I don't want to put my eggs in too few baskets with individual stocks. It sounds like a mutual fund is exactly what I want. If you don't want it to be locked away (even though the tax advantages are huge), then just open a regular brokerage account at somewhere like Vanguard. Also you want index funds, probably not mutual funds (the fees and loads of a mutual fund will almost never beat the market return of a true index). You'll pay taxes on the gains and distributions but you can do them whenever you want in a regular brokerage account. Just do something like the three-fund portfolio (tl;dr- total US stock index fund, total international stock index fund, and a total bond market index fund. Choose your asset allocation of stocks vs bonds according to your age and risk tolerance). khysanth fucked around with this message at 21:07 on Jun 5, 2015 |
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Jun 5, 2015 21:04
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asur posted:You would compare it to a relevant benchmark, which may not be trivial to find. A quick comparison would be to the S&P 500, but if your allocation doesn't reflect the same risk then it's not really accurate. The market has been pretty flat for the past month and a half and is only up 2% YTD. In the short term, return should probably be ignored as the market fluctuates a lot. I'd pick an allocation using index ETFs or mutual funds and then basically ignore return as the funds you pick will track the index. If you post your allocation, the thread can probably give more advice. These are the two funds that my financial adviser picked out.  
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Jun 5, 2015 22:47
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legsarerequired posted:These are the two funds that my financial adviser picked out. Your advisor is a salesman who does not have your best interests at heart.  
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Jun 5, 2015 22:56
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Guinness posted:Your advisor is a salesman who does not have your best interests at heart.  Got it! Well, my adviser was great for helping me convert my traditional IRA to a roth IRA but I guess it's time for me to research this type of thing for myself.
legsarerequired fucked around with this message at 23:57 on Jun 5, 2015 |
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Jun 5, 2015 23:37
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An income fund doesn't make sense if you're 27 for your Roth IRA. Your allocation should probably be a lot more aggressive. If you don't want to do that much research, pick a low ER target retirement fund and call it a day.
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Jun 5, 2015 23:42
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Guinness posted:Your advisor is a salesman who does not have your best interests at heart. 
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Jun 5, 2015 23:54
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Yeah, you can't go terribly wrong with a target-date fund until you do some more research and have more total assets that want to make finer adjustments to your portfolio. Those load fees in particular are absolutely BRUTAL. That's a 5.75% fee of total assets invested right off the bat. If you invested $1000, right away you're already down to $942.50. And on top of that, the annual expenses are above-average. Compounded over time we're talking significant amounts lost just to fees. And worse yet, much research has shown that actively-managed funds underperform against similar, cheaper passively-managed funds. Let's compare:  No load, and annual expenses are only 0.18%. And the allocation automatically adjusts over the lifetime of the fund based on generally-accepted allocation figures for your age/target date. Once you have more assets and want to fine-tune your allocation, you can then start getting into funds with ERs in the 0.05% range, but minimum investments are in the $10,000-50,000 range. But don't worry about that for now. Cicero posted:"fee level: low" It seems that Morningstar considers anything with less than 1% ER "low", which is hilarious. Also it doesn't seem to account for the absolutely murderous load fees.
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Jun 5, 2015 23:55
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khysanth posted:If you don't want it to be locked away (even though the tax advantages are huge), then just open a regular brokerage account at somewhere like Vanguard. Also you want index funds, probably not mutual funds (the fees and loads of a mutual fund will almost never beat the market return of a true index). I thought index funds were a type of mutual fund? That is what I was looking to invest in. Are you saying I should get ETFs?
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Jun 6, 2015 00:06
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I need some quick advise. I'm finishing a project this month and will be spending $10k. I have good credit (last FICO score I saw was two years ago @690 or 720, I can't recall) and have been considering signing up for a low/no interest CC to spread out the load. Two notes: I have the cash, but it's in my emergency fund and I don't want to empty it right now unless someone can convince me otherwise, and 2) I can dedicate $2k a month to pay it off. I'm wondering if there's a rewards card that fits in this scenario or if something like a Chase Slate card would be a better option?
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Jun 6, 2015 00:17
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jarjarbinksfan621 posted:I thought index funds were a type of mutual fund?
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Jun 6, 2015 00:22
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I'm British and live in the UK, my girlfriend is American and lives in the US. I go out a few times a year, and that's likely to increase in the future. Sometimes I find its to my advantage to use American companies for goods and services due to prices over there being cheaper. Obviously I can buy while I'm over fine, my credit card gives me rates that are usually slightly better than what's listed on xe.com with no fees. However sometimes it's useful while I'm not there. For example, this week I realised it was cheaper to pay for an online service via the American site over the UK. It asked me to enter my billing address, so I used the US one and everything seemed to go through fine. Not sure if other places are likely to reject though, so wondering if getting a prepaid debit card and refilling it every so often would be useful for me. Do they get registered to an address? Do most sites accept debit fine? I always recall the US being more credit card friendly, but not sure how widespread that is.
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Jun 6, 2015 00:29
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Cicero posted:You are correct. khysanth probably should've said "actively managed mutual fund" (index funds are passively managed). Yea my bad. I'm currently reading Bogle's "Common Sense on Mutual Funds" and it's like a trigger word at this point. the spyder posted:I need some quick advise. You can apply for one of the big 40k/50k bonuses on cards like the Barclay Arrival+ World Elite MasterCard or the Chase Sapphire Preferred. Spend the money. Get the points. Downgrade the card before the annual fee kicks in on year two. khysanth fucked around with this message at 01:00 on Jun 6, 2015 |
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Jun 6, 2015 00:57
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EL BROMANCE posted:For example, this week I realised it was cheaper to pay for an online service via the American site over the UK. It asked me to enter my billing address, so I used the US one and everything seemed to go through fine. Not sure if other places are likely to reject though, so wondering if getting a prepaid debit card and refilling it every so often would be useful for me. Do they get registered to an address? Do most sites accept debit fine? I always recall the US being more credit card friendly, but not sure how widespread that is. Cicero fucked around with this message at 01:17 on Jun 6, 2015 |
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Jun 6, 2015 01:14
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the spyder posted:I need some quick advise. In addition to kyhsanth's good advice, the chase slate card isn't good for what you're wanting to do. It's excellent for balance transfers and a long initial 0% apr after opening the card, but has no rewards benefits.
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Jun 6, 2015 03:47
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I'm actually traveling quite a bit for work and did not consider a airlines based rewards card- looks like either is a great option. Thanks.
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Jun 6, 2015 04:09
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the spyder posted:I need some quick advise. Are you spending 10k in a month, or a short period, and then want to pay it back over a longer period? If so, I don't know of a rewards card that gives 0% APR for a long duration. I think you could do something like buy on a rewards card that offers a sign up onus and then transfer to Chase Slate, make sure to double check that balance transfers are 0% APR for the duration you need.
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Jun 6, 2015 06:30
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I will be start my engineering career in July and my employer matches up to 6% on their 401k plan (Blackrock?). The first 3% is fully matched and the latter 3% is matched at 50%. My expenses are low so I was wondering if I should put more into the 401k. My employer also has an HSA with HealthEquity that they put $650 in per year. How is the HealthEquity HSA? As a new grad, this is all very ¯\_(ツ)_/¯ for me.
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Jun 6, 2015 13:32
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For 401k, you for sure want to at very least put in the 9% to get the full match. HSAs are generally very good for young people without much medical expense other than regular checkups. My HSA is also with Health Equity, and so far they seem pretty good. Investing more into either is pretty much always a good idea if you can afford it. PS. The numbers you posted are extremely familiar, you don't happen to be starting at a big Aerospace company in Oklahoma are you?
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Jun 6, 2015 14:30
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Xenoborg posted:For 401k, you for sure want to at very least put in the 9% to get the full match. HSAs are generally very good for young people without much medical expense other than regular checkups. My HSA is also with Health Equity, and so far they seem pretty good. Investing more into either is pretty much always a good idea if you can afford it. That's good to hear! I have very little expenses so I should be able to afford to invest more. I think I know who you're talking about, but no they turned me down so I went with my local power company to do smart grid work.
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Jun 6, 2015 14:43
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khysanth posted:Just do something like the three-fund portfolio (tl;dr- total US stock index fund, total international stock index fund, and a total bond market index fund. Choose your asset allocation of stocks vs bonds according to your age and risk tolerance). I've been reading more into this, and it sounds like exactly what I want, but drat, it's expensive to get your foot in the door at Vanguard. This kind of thing would run me 9k to start with their 3k deposit minimum. Is there someplace that is comparable that you can do this cheaper? I could probably manage up to 3k to start.
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Jun 6, 2015 19:15
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jarjarbinksfan621 posted:I've been reading more into this, and it sounds like exactly what I want, but drat, it's expensive to get your foot in the door at Vanguard. This kind of thing would run me 9k to start with their 3k deposit minimum. Is there someplace that is comparable that you can do this cheaper? I could probably manage up to 3k to start. Just use one of Vanguard's Target Date Funds. I believe their minimums are $1k.
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Jun 6, 2015 19:16
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Isurion posted:Just use one of Vanguard's Target Date Funds. I believe their minimums are $1k. Either that or use ETFs. Those don't have a minimum.
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Jun 6, 2015 19:26
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legsarerequired posted:
The technical term for what your advisor is doing is "screwing you hard", because you can get a better portfolio for a lot less expense. A good course of action (not the only good one) would be to move the IRA to Vanguard and put the entire thing in a single fund. If you want the same general allocation you have now (GOD WHY) you could use VASIX, the Life Strategy Income Fund. Otherwise a good initial option would be the Target Retirement Fund for whatever your anticipated year of retirement is. Come to the retirement thread for more, we try to be friendly to newbies!
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Jun 6, 2015 20:36
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Xenoborg posted:For 401k, you for sure want to at very least put in the 9% to get the full match. HSAs are generally very good for young people without much medical expense other than regular checkups. My HSA is also with Health Equity, and so far they seem pretty good. Investing more into either is pretty much always a good idea if you can afford it. Damnfan, I would do the match (6% from what you said) without question, and then max your IRA - at Vanguard due to low ER - and then max your 401k.
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Jun 7, 2015 08:46
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So I start my new job mid July. I have a meeting with HR, I assume to set up payroll/benefits/etc, later this month. I know very little about things like retirement funds and such. Like, I know an IRA and a 401k are both retirement things, but I don't know what the difference is, or what is better. If someone has a like primer in could read so I'm not walking in to the meeting blind and dumb, that'd be great. I'm also working on making a budget, so any advice there (I'm 24, pre-tax yearly income will be around $56K not counting potential overtime, I am getting a new car because my current one won't survive the commute) I'd very much appreciate it.
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Jun 7, 2015 14:38
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Annath posted:So I start my new job mid July. Congrats on the new job! I suggest visiting the The Long-Term Investing and Retirement Savings Thread. Start with the first two things quoted in the OP (Bernstein's short PDF "If You Can" and JL Collins' "Stock Series", especially Parts I through X). The reading will take you a couple hours at most. Then you can ask followup questions in the thread. I agree with this assessment: slap me silly posted:Come to the retirement thread for more, we try to be friendly to newbies!
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Jun 7, 2015 14:46
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