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totalnewbie posted:But if your deferment means you're in a lower tax bracket when you withdraw, you still benefit. And that's so right, it absolutely depends on individual tax situation.
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May 26, 2020 00:56
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moana posted:Given we're at historic lows for tax rates, not something I would bet on, but yes, especially if you're in a high bracket now, it could be worth it. I've said this before and I'll say it again -- it's pretty tough to predict the political winds in a few decades, yes the country will probably need more revenue but the methodology could vary quite widely (e.g., a federal VAT tax, bringing capital gains rates in line with nominal tax rates, .etc.)
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May 26, 2020 18:14
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Small White Dragon posted:I've said this before and I'll say it again -- it's pretty tough to predict the political winds in a few decades, yes the country will probably need more revenue but the methodology could vary quite widely (e.g., a federal VAT tax, bringing capital gains rates in line with nominal tax rates, .etc.) Historically, they are at an all-time low. But what does this tell us about the future? Let's debate for another 5 pages.
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May 26, 2020 21:15
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Small White Dragon posted:I've said this before and I'll say it again -- it's pretty tough to predict the political winds in a few decades, yes the country will probably need more revenue but the methodology could vary quite widely (e.g., a federal VAT tax, bringing capital gains rates in line with nominal tax rates, .etc.)
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May 26, 2020 23:28
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So we've identified ~70,000 in costs over the next year split across ten "buckets" Looks like Ally Bank has buckets for both their savings and checking, but it only tells you how much money has been allocated to that bucket. It doesn't allow you to set a goal amount, nor does it tell you how far along (10%, 50%, 99% etc) towards that goal Looks like Mint.com has this feature but I am kind of loathe to use it, and I don't like the interface Is there another budgeting tool out there? There's YNAB but I don't want to use that product for personal reasons Is there a US based bank that provides an API to get the balance of your account, and then I can just do the budgeting programatically? I figure if I can get the balance out of my bank's API then I can apply the buckets using a django web app or something, and then display the bucket progression over time via grafana or whatever TL;DR do any banks allow you to get balance info via API
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May 28, 2020 22:22
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Hadlock posted:So we've identified ~70,000 in costs over the next year split across ten "buckets" gently caress ally's buckets. Capital one used to, don't know if it was public. I just made sub accounts named after my buckets. I will say that I got blinders on micro allocating stuff. A financial planner said "you know if you just collapse this all together you can do this today, then that in 6 months, then... Rather than all of them in 10 years" and it clicked. Make 2 savings accounts. Name one "efund - 20k" (whatever) and target that amount as a minimum. Let the interest accumulate as its your only hedge against inflation. Force rank your projects based on the personal priority. Set the name of the other account to be the name of your next goal and the amount.
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May 28, 2020 22:43
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H110Hawk posted:gently caress ally's buckets. Curious why? I don't use the buckets feature but it seems like it could be good?
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May 28, 2020 23:33
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spwrozek posted:Curious why? I don't use the buckets feature but it seems like it could be good? They are in the way and slow to load on the mobile app. So you see your activity log then NOPE it's a full screen down. For a feature I don't use.
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May 29, 2020 00:28
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Also Ally doesn't penalize you on having multiple actual savings accounts and splitting poo poo up that way.
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Jun 1, 2020 22:54
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IOwnCalculus posted:Also Ally doesn't penalize you on having multiple actual savings accounts and splitting poo poo up that way. Truth. I have like 10 different Ally savings accounts for different goals.
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Jun 2, 2020 13:08
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DJCobol posted:Truth. I have like 10 different Ally savings accounts for different goals. I do the same in Amex FSB. I have a general savings, an IRA savings for the next year (I deposit $500 in it every month) and then a monthly expense savings accounts.
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Jun 2, 2020 13:11
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I've had zero issues with the buckets feature in Ally on mobile or desktop. Works well enough for me!
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Jun 2, 2020 20:05
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I'm not sure if this is the best thread for it, but I figured I would start here. My wife and I are working up to maxing out our HSA, and wanting to start investing some of the money stashed in there, but am not very familiar with most of the ticker symbols. We are both mid-30's with a couple of kids and I am our only income. For our other investments (401k, Roth, brokerage etc.) we are mostly in mix of index funds like VTSAX, VTIAX and VBTLX or Target Date funds to make it simple. Which of these investments makes sense to jump into? Are some of the tickers like VBMPX just a different version of VBTLX?code:
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Jun 15, 2020 23:16
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Yeah, looks like the institutional fund class. Are you treating this like an extra Roth? I'd just go as hardcore aggressive as you can in an HSA since you won't be pulling out for 30+ years. Mine is all in REITs since it's tax advantaged. I hope your brokerage acct isn't invested in target date funds tho.
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Jun 15, 2020 23:29
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Also this is off topic and maybe you have enough to self insure, but if you're the sole earner please make sure you have decent disability insurance and a term life insurance policy. And an estate plan with guardianship provisions. Just mentioning since we are in the newbies thread.
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Jun 15, 2020 23:32
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moana posted:Also this is off topic and maybe you have enough to self insure, but if you're the sole earner please make sure you have decent disability insurance and a term life insurance policy. And an estate plan with guardianship provisions. Just mentioning since we are in the newbies thread. Whats the general rule of thumb on amounts for life insurance? I just got enough to pay off house/any other debts and bury me plus like a $40k cushion. More was pretty cheap but I thought it'd be excessive.
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Jun 15, 2020 23:48
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BaseballPCHiker posted:Whats the general rule of thumb on amounts for life insurance? I just got enough to pay off house/any other debts and bury me plus like a $40k cushion. More was pretty cheap but I thought it'd be excessive. 10x your income is a typical benchmark. This depends on how much more money you earn compared to your lifestyle though. I have a million on myself and $500k on my wife. That's less than 10x my income, but it's within a lifestyle adjustment of it based on our other savings and the number of years I expect to support my wife and kids in the event of my untimely demise. 25yr term. Do not do Whole or Universal or Anything That Isn't Term Just Say gently caress Off.
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Jun 16, 2020 03:07
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I would want enough to get my daughter to 18 without my husband having to go back to work. There's no real rule of thumb since it's so dependent on your individual situation - what you have saved up already, what your expenses are, how long you would want to support your dependents, if you want to pay off your mortgage, etc. That income rule is fine to start from, knowing that what you actually spend is more relevant to what you need to calculate.
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Jun 16, 2020 05:32
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Another question just came to mind. Is it worth opening a Roth IRA if I cant max out my employers 457b plan? I pay %7.5 percent of my gross income into a pension plan, my employer contributes another %7.5. Then I contribute %10 of my net income to the 403b. That plan has a pretty high contribution limit, I think its about $18k a year. I'm only on track to contribute about $5k. The plan has good vanguard offerings so I dont know if I'm overthinking things by trying to add a IRA when I could just potentially throw more money towards the 457b. EDIT: Apparently its a 457b plan not a 403b. BaseballPCHiker fucked around with this message at 13:42 on Jun 16, 2020 |
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Jun 16, 2020 13:38
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BaseballPCHiker posted:Another question just came to mind. Do you work for a government agency? There's supposed to be a lot of pitfalls with non-government 457b plans that you might be better off shifting that $5k in contributions to an IRA instead.
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Jun 16, 2020 17:24
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moana posted:Yeah, looks like the institutional fund class. Are you treating this like an extra Roth? I'd just go as hardcore aggressive as you can in an HSA since you won't be pulling out for 30+ years. Mine is all in REITs since it's tax advantaged. moana posted:Also this is off topic and maybe you have enough to self insure, but if you're the sole earner please make sure you have decent disability insurance and a term life insurance policy. And an estate plan with guardianship provisions. Just mentioning since we are in the newbies thread. BaseballPCHiker posted:Whats the general rule of thumb on amounts for life insurance? I just got enough to pay off house/any other debts and bury me plus like a $40k cushion. More was pretty cheap but I thought it'd be excessive.
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Jun 16, 2020 21:37
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Falco, you have a spousal ROTH IRA setup right?
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Jun 16, 2020 21:43
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Homies IRA is an acronym but Roth is not
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Jun 16, 2020 21:47
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Named for this dude.
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Jun 16, 2020 21:52
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I know. My phone autocorrects it to that for some reason and I am to lazy to fix it. Just imagine I am yelling.
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Jun 16, 2020 22:15
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spwrozek posted:I know. My phone autocorrects it to that for some reason and I am to lazy to fix it. Just imagine I am yelling. 
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Jun 16, 2020 22:21
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spwrozek posted:Falco, you have a spousal ROTH IRA setup right? Yeah, sorry I haven't been very good at sharing the whole picture. I've got my 401k through work that isn't quite maxed out yearly (I'm around $12k/yr), both of us have a Roth IRA that are both maxed yearly, she has a Brokerage account in addition to the Roth and now we are trying to increase our contributions to the HSA and get to a point where we can max that out before long as well. It just seems silly to have ~$5k just sitting in our HSA not doing anything. We have enough savings to cover our deductible and out of pocket max beyond our 6mo emergency fund, so I'm not terribly worried about investing our HSA funds.
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Jun 16, 2020 22:23
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Nice man. Good work.
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Jun 16, 2020 22:28
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GoGoGadgetChris posted:Homies IRA is an acronym but Roth is not Stop giving bad advice! IRA isn't an acronym; it's an initialism. We don't pronounce it like the given name Ira! 
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Jun 17, 2020 13:22
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Ancillary Character posted:Do you work for a government agency? There's supposed to be a lot of pitfalls with non-government 457b plans that you might be better off shifting that $5k in contributions to an IRA instead. Yeah I work for a government agency. This plan is supplemental to my state pension which is 15% of my salary contributed each month. I think for now I'm just going to hold off on contributing more. We're expecting a kid soon and daycare is not cheap from calling around....
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Jun 17, 2020 14:02
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SpelledBackwards posted:Stop giving bad advice! IRA isn't an acronym; it's an initialism. We don't pronounce it like the given name Ira! Speak for yourself! I pronounce it like the This American Life host.
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Jun 17, 2020 15:26
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H110Hawk posted:Speak for yourself! I pronounce it like the This American Life host.
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Jun 17, 2020 21:37
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Dik Hz posted:I'm pretty sure Ira Glass pronounces the initialism correctly too. It would disappoint me if he didn't.
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Jun 17, 2020 21:55
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Hey, first time poster in this forum. I'm looking for some sound advice on next steps, financially. Here's a breakdown of where I am. In March of 2018, while still working in an hourly position and taking night classes at a coding bootcamp, I lost my job and was out of work for about 10 weeks, during which time I defaulted on about $20k worth of credit card debt across 5 cards and a personal loan. I managed to keep my car and only have a 60-day late hit on that that's about two years old now and on time since. I avoided all the calls from the credit card companies (I know, I know) and they were charged off and sent to collections between May and October of that year. In December of 2018 I career changed into software development a couple months ahead of graduation from bootcamp (I still graduated) which doubled my income. In August of last year I accepted a position with another org paying about 30% more on top of that, where I am now. My salary is $78,400 plus a variable annual bonus with a base rate of 5%. My performance in this role has been highly praised and I have been told to cautiously expect a title upgrade in September and concomitant raise, which I don't know the expected size of but would guess around 10%. I am not figuring this into my future budgeting until it's official. When I accepted my current position, I finally called all of the collection agencies holding my accounts and negotiated settlements. After taking the cheapest room I could find for a year instead of living alone, and aggressively snowballing, as of last Friday (July 17 2020) I made the final payments and all of them are settled. I paid off the accounts showing active collections first and they have come off of my credit report, but a couple of the negative CC accounts have not yet updated and still show a balance. I currently have nothing in my 401(k), but in a few weeks on the anniversary of my hire date I become eligible for matching and will start maxing out my matched contribution at 5%. 25% of my after-tax income is auto deposited into savings (about $560 every two weeks), which currently sits at $1000 after wiping out the last big chunk of debt. My spending is well under control, and I also move anything left over in my checking account on the day before payday into savings, usually another few hundred at least. The remaining balance on my auto loan is $7860 at somewhere around 6.5% APR and will be paid off in January 2023 if I continue to make minimum payments. I've been intentionally doing so in order to keep a running account in good standing and work my on time payment percentage back up. I also opened two secured credit cards with no annual fees in February of this year. Each has a $200 credit limit, and has one small bill (like Netflix) on it to keep it revolving and is set to auto draft the full balance every month. I do not use them otherwise and don't even carry them. Credit Karma is reporting my score as between 630-640 with no collection accounts on the report, just the old closed accounts with negative remarks indicating they were settled for less than the full balance. The big jumps from the removals have already happened, so I'm not sure if it will change mugh when the balances drop off. My goal is to own a home as soon as is responsibly feasible, though I'm aware it will be a matter of years. What are my logical next steps other than growing my savings? In particular, what can I do to help my credit score recover in the meantime while I work on being in a position to buy? TL;DR Bunch of chargeoffs 2 years ago, massive career upgrade since and no longer have any outstanding debt other than my car loan. Well cushioned in terms of income versus expenses, but no real nest egg yet. Credit score around 640, looking for a path forward that ends in home ownership at a reasonable rate when that's feasible. Let me know if I need to format the relevant data better. ETA: Cost of housing in my city has been rising sharply for about 8 years but appears to be leveling off. Median sale price in the last year is around 300K. Dross fucked around with this message at 00:56 on Jul 22, 2020 |
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Jul 21, 2020 23:57
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Hey, it should be said , great job taking a year , living cheaply and not as comfortable , and paying off the debt. Not everyone can do something like that. I don’t know a lot on house buying , but obviously improving credit and having savings is the next step, so I’ll post my thoughts there. Credit score: you’re on the right pace, keep doing exactly what you’re doing with those credit cards. You should see it jump over 1-2 years for sure. 401k: just a reminder to always take the match, good job there. I would argue any positive impact the car loan has on your credit is negated by the 6% interest. 6% isn’t terrible, but it’s not great. If you are able to snowball and pay off the car loan early like you did your other debt, it will actually then allow you to save more (because you aren’t being charged 6% interest on $7,000). So basically: next steps should be: -Make a budget (which tells you what you can and can’t do money wise) -make sure you have a good emergency fund -pay off car loan (Arguable to pay off car loan before emergency fund) -contribute to 401k Match -once you have an emergency fund, save up to whatever target you identify that you will need as a down payment for a house. I would bet it’ll be 1-3 years to do all that, so by that time your credit will naturally fix itself. Finally: owning a home is great, just make sure you are doing it because you want that life style, and not because owning a home is part of what is expected in America.
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Jul 22, 2020 00:35
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That was a feel good pro-read.  First off: Don't worry about buying a house or your credit score for the moment. Make your budget and stick to it, you have at least a year before you will have saved up enough to buy a house assuming you want a "traditional" detached single family home you live alone (or with only your family) in. Don't miss out on that 401k match in your budget. I'm also on team "pay off your car note" but that's up to you, and I would do it after you have a month or two of e-fund built up and not use your efund to do it. Check your credit report once or twice a month and make sure that those creditors are actually living up to their end of the bargain. Dispute anything which is inaccurate. Again, ignore the score. So long as you're living "clean" it shouldn't be going anywhere but up and obsessing over it will drive you crazy because some months it will go up and others it will go down despite nearly zero change. In a year, assess where you're at and figure out what home prices are where you want to live, with the features you want. What are "needs" and what are "wants". The ideal down payment is 20% in addition to your emergency fund. You can get loans as low as 0% down, but you are playing with fire. Below 20% down you will pay more for your mortgage, and you're already likely to pay a bit more due to your credit history. Below 10% you're getting into being underwater on your house the moment you buy it, not a great place to be. Futz with some mortgage calculators that include PITI and figure out which home prices match your budget based on your down payment. Skim those houses. If you need more money, save more money. You will get a feel for it where "home price is $450k down payment is $45k at whatever interest is $3000/month PITI." (I just made that up.) You can go from there in zillow figuring out the rest. There is a home buying thread when you want more details on that in a year. Want to accelerate this process? Keep job hunting. The fastest way to grow your savings rate is to earn more money. The fastest way to grow your salary in most cases is to switch jobs. You're a software engineer. As you gain experience jump positions for more money. Keep learning. Keep talking to peers. Never be the smartest person in the room. (But don't be a cocky jerk either.) Know your worth and ask for it. You can't get what you don't ask for in life. Network (lol COVID.) Stay in communication with your boss about ways to improve yourself, you should be having at least monthly 1:1's with them and a good company will have you doing them nearly weekly. Strangely enough, learn to understand business people and their jargon. You will go further in life being able to clearly articulate yourself to the people with the purse strings and sometimes that means excel and powerpoint.
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Jul 22, 2020 01:17
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Don't ever make a financial decision based on its impact on your credit score. I vote efund to bare bones, 401k to match, pay off car loan, full efund as your next steps.
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Jul 22, 2020 03:36
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Given that we are still in pandemic mode in the US (I assume you're in the US), even though your industry and salary raise prospects sound good, I'd look to creating a larger emergency fund than 1-2 months if you can, and keep car payments at minimum until you have at least a 3-4 month or 5-6 month fund. Jobs are not in plentiful supply right now, and if anything happens to yours you don't want to be left holding the bag while waiting for unemployment or some other form of assistance to keep in. Then after that, by all means aggressively attack the car loan with the debt avalanche (apply all extra moneys toward debt payments at the highest interest % loan, always... unless you can clear a lower interest loan off the books that month with the usual overpayment. Might be worth it in that case to have fewer loans to track. But purely from a numeric standpoint, avalanche is always superior to snowball in terms of debt repayment time and overall interest paid. When you only have 1 source of debt, or all your debts are at the same interest rate, then they work exactly the same. Here's a summary: https://www.cnbc.com/select/debt-snowball-vs-debt-avalanche/ You can run the numbers and choose to do it either way, or switch around as you go. There's no totally wrong answer unless 1 debt has a grossly higher rate than all the others in terms of interest rate (not talking about balance remaining), such as payday loans or high interest credit cards.
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Jul 22, 2020 06:12
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Thanks for all the feedback everyone. It sounds like I should just stress less about when I’ll be able to do something that’s far off. I’ll start making bigger payments on the auto loan and just worry about that and growing savings for the time being.
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Jul 22, 2020 20:12
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CEO of our parent company sent out an email stating they're starting an employee stock purchase program. I don't own any stocks and any money I invest has been through retirement vehicles. That being said it would appear that they're offering a 20% discount for most employees.quote:I'm delighted to announce the launch of our new [redacted] Employee Stock Purchase Plan (ESPP). This program gives you the opportunity to purchase [redacted] stock at a discount, become a shareholder and benefit in the future growth of the company. This new ESPP is in addition to the separate Employee Stock Ownership Program (ESOP) we already have in Japan. Having no experience with stocks, can someone give me a rundown of how stock purchase programs generally work? I have a budget I stick to, but I just got a promotion/raise and will have a bit more money coming in. Do these purchases come through payroll deductions? What's a savings period, is it like you have payroll deductions that accumulate during that time frame, and then the purchase of sticks is made after that period? And I know it will be asked: I put 16% into 401k, have no debt, and a plenty large emergency fund. I'm also fairly certain I'm not eligible for the long term incentive program, but would have to check.
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Jul 23, 2020 17:56
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