BFC Newbies Thread: 33% of the interest paid is tax delectable

The Something Awful Forums > Discussion > Ask/Tell > Business, Finance, and Careers > BFC Newbies Thread: 33% of the interest paid is tax delectable

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H110Hawk: Dec 28, 2006

howdoesishotweb posted:

I have a LTDI policy through my employer that covers 60% of my salary, for a $25/month pretax deduction. I also carry a portable LTDI policy for another 30%, which cost about 2% of monthly payout. Like all catastrophic insurance it’s unlikely I’ll ever use it, but I have 3 dependents and it helps me sleep better.

Is that 2% annually? Like $100k salary, you are covering 30% so $30k/year benefit. Does that cost $600/year? Is it a fixed rate for a certain time or does it go up each year?

# ¿ Nov 11, 2019 02:59

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# ¿ Apr 29, 2024 09:43

H110Hawk: Dec 28, 2006

Mad Wack posted:

My job also offers Hospital Indemnity, Critical Illness, Legal, and Accident coverages (separately) but they all seemed unnecessary when my job already gives me free LTD and STD plus I pay for the regular health insurances.

Does anyone use these or think they have value? Feels like a cash grab to me.

What is hospital indemnity? What is your field?

If you have a propensity to cancer critical illness might be worth it, legal is almost certainly not, and if you do dangerous hobbies accident could be assuming they aren't excluded.

LTD and term life are the big ones. I wouldn't get life insurance from your work though, it is almost certainly cheaper and better to get it on your own.

# ¿ Nov 14, 2019 16:00

H110Hawk: Dec 28, 2006

BlackMK4 posted:

What is the general rule for a house down payment?

Is pulling 401k contribution back to match normal in order to stockpile cash more quickly, or is it better to keep on contributing to max out the 401k / max IRA and take more time to reach down payment + closing costs?

I have no debt, $10k EF, about $120k in taxable brokerage, am looking at ~$250k places, and am able to save about $4k/mo while maxing IRA/HSA/401k. Figure another $2k/mo if I shove off the retirement funding while I save the $60k estimated I'll need for down payment and closing costs.

15 months versus 10.

I would greatly prefer not to liquidate my taxable account as it would feel like a kick in the balls.

Liquidate the taxable. Don't lose out forever on tax advantaged space. It's way cheaper and easier to refill your taxable account.

# ¿ Dec 1, 2019 04:59

H110Hawk: Dec 28, 2006

nelson posted:

Dropping the 401k contribution down to whatever is matched is fine. It’s what most of us who own houses did I’m guessing.

This does not make sense when they have a 50% down payment sitting in a taxable brokerage or the ability to save the entire down payment without impacting retirement contributions at all in ~12 months. Touching their retirement is the worst possible idea short of taking a fha loan.

Edit: there is a home buying thread if you want to come by and get this same advice from other people. We can also get you help in shopping for your house, mortgage, and other moving costs.

# ¿ Dec 1, 2019 17:26

H110Hawk: Dec 28, 2006

BlackMK4 posted:

Thank you all for the sanity check, I appreciate it. It looks like I'm going to liquidate enough to make this happen in a timeframe of about 6mo while still maxing out retirement.

I'll be by the housing thread in a few months.

a thread success story.

# ¿ Dec 1, 2019 22:07

H110Hawk: Dec 28, 2006

colachute posted:

I have a sapphire card so I get emails from chase asking me to open checking accounts all the time. I was looking to see the requirements for their $1000 bonus and I read that they have a $25 monthly service charge on sapphire checking unless you have an average of $75k in your checking account.

So my question is why would anyone ever keep that much in a checking account?

Because making $1000 in 3 months just for leaving $75k idle then closing the account is worth it. Any bank worth their salt will look at total assets held with them across all product lines if you're getting into actual rich person accounts the bank wants to have.

KYOON GRIFFEY JR posted:

because you are stupid, stupid rich

i knew a guy that as part of a package of various other banking services was required to keep $100k in his checking account to avoid fees

I feel like your guy was getting ripped off by his bank. If he was truly stupid rich he should have been able to leave it in some overpriced mutual fund in the banks brokerage arm. :v:

# ¿ Dec 4, 2019 18:29

H110Hawk: Dec 28, 2006

totalnewbie posted:

I got a one dollar misc credit to my checking (Chase):

TRANSFER FROM CHK XXXXXX####

I don't recognize the #### - any ideas? This was a week ago. Don't see anything strange in the account. My checking account is basically only ever used to get my paycheck, pay my mortgage, and pay my credit card. Don't use debit, etc.

Call and ask. It's the only way to know, and if it's fraud, you want to stop it now before someone does the transfer in the other direction.

# ¿ Dec 17, 2019 00:15

H110Hawk: Dec 28, 2006

Hadlock posted:

So increasingly I'm finding that I am doing banking in California, Texas and North Carolina. Now we are starting to get into real estate and wanting to shuttle money back and forth and the lack of physical locations in these states is beginning to be a problem.

Occasionally I have to do business with Capitol One, which has physical banks, but they only have physical banking locations in a handful of states, and not Texas or California. They have some "Cafes" but don't actually employ any bankers at those locations and they're little more than call centers you can walk into; and it's caused problems in the past where a physical face to face solution would have solved the problem in under 15 minutes.

Wells Fargo is/was headquartered out of San Francisco so they have physical locations in most every city here in California, they also have a pretty heavy presence in Texas and I'm guessing also NC. They're also objectively evil so looking for other options. Bank of America also is probably pretty similar to Wells Fargo.

Are there any "nationwide" banks that have physical locations in most states, but at the same time aren't super evil, and have reasonable customer service?

No. Open an account, use it to close your house, close the account. Or use Charles schwab / Fidelity cash management accounts. Wire transfers are all the same.

# ¿ Dec 23, 2019 00:40

H110Hawk: Dec 28, 2006

DarkHorse posted:

Regarding the car loan, you might come out ahead if you change your insurance to liability only after you pay the car off, assuming you're comfortable with that level of risk. Otherwise yeah it's probably close to a wash

Generally speaking this is terrible advice for newbies and most advanced people. Comp/coll/uninsured is a very valuable product for cars that aren't trivially replaced financially.

# ¿ Dec 25, 2019 18:20

H110Hawk: Dec 28, 2006

incogneato posted:

Motronic is correct, but to be clear for OP: there are no federal tax obligations (for the recipient) on gifts or inheritances. I don't know much about state taxes on inheritance, but I think relatively few have that.

When you hear about gift and estate taxes, those are taxed on the estate or person doing the giving (again, at the federal level), not the person receiving. And you'd have to be talking about an estate worth many millions before that is even a consideration anyway. At that point the estate likely has a professional handling this stuff.

Currently like $11.5 million per person / $23 million for a married couple. To put a scale of how unlikely it is that there is a federal obligation here.

# ¿ Dec 25, 2019 19:30

H110Hawk: Dec 28, 2006

KodiakRS posted:

Totally not gonna do this. The car is only 4 years old and still worth a decent amount of money. Knowing my luck if I dropped comp coverage I'd wrap the car around a cactus the next day.

And for my inner pedant: comprehensive is everything that isn't a collision. The cactus would have to wrap itself around the car for it to be comprehensive. :v:

# ¿ Dec 26, 2019 17:05

H110Hawk: Dec 28, 2006

Thanatosian posted:

The name is probably the only real difference. Credit unions like to use different nomenclature from banks in order to remind their membership that they are owners in the credit union, and not just customers. "Share certificate" sounds like it's just trying to say you're a shareholder, but you'll need to read the terms to be sure.

Yeah double check everything in the terms and conditions. When I was at a credit union it was basically their branding on a insured money market account. It was your share, dollar for dollar, of the overall pool of money as I recall. They like to remind you that you are in this with them, it's in theory a mutually beneficial relationship.

# ¿ Dec 28, 2019 16:16

H110Hawk: Dec 28, 2006

Hutzpah posted:

This is BFC adjacent, but I am going to be selling my house this year and moving to a new town. Is there any BFC-approved advice regarding selling? Like, is a real estate agent a must? What fee is appropriate? That kind of stuff.

Yes. Find the good one in town. Look at zillow's sold inventory by them and make sure you are happy with the price. (But for all you know there are a ton of concessions built in, the sale price is what they are paid by and how they advertise to you the prospective seller so they rarely try to lower that.)

It's going to be 5-6% fee. If you are happy with any price then you can save 1-2% using a discount disappointment realtor off redfin.

# ¿ Feb 7, 2020 17:23

H110Hawk: Dec 28, 2006

Fancy_Lad posted:

PSA for anyone using Capital One 360 accounts: Apparently they have discontinued their old savings and money market accounts and replaced them with a new "Performance" account type. Additionally, they have been cutting the APR on the discontinued accounts. My savings is down to .6% for example (the performance version is at 1.60%, even more than my money market that has account minimums to hit 1.59%).

Skimming through this reddit thread, it looks like you can't just switch the account type over, you have to open an entirely new account up (and then flip any account linking you have in place).
https://www.reddit.com/r/personalfinance/comments/dnt4uc/capital_one_savers_switch_to_performance_savings/

I went through my emails to see if I missed a communication on this, but I sure can't find any kind of notice on it - figure I'm not the only one in this boat.

I'm an old ING Direct customer that's just been sticking with it because the APR has been similar enough to not worry about rate chasing, but given how this went down and the fact that I'll have to redo account linking anyway, what's the current hotness for online checking/savings? A good website/app, ability to do single and jointly owned accounts, and a competitive rate are what's important to me.

They're trying to shed the promises they made ING Direct customers. I moved to ally and it's better in every way. For now.

# ¿ Feb 9, 2020 18:34

H110Hawk: Dec 28, 2006

Bushido Brown posted:

Almost all of that was due to Chris's basic advice of "paying myself first," and some of it was because you were such an abrasive rear end in a top hat in this post that I wanted to be able to come back with a definitive "gently caress you."

Spite: the most powerful of motivators. :toot:

# ¿ Feb 16, 2020 22:20

H110Hawk: Dec 28, 2006

drive me nuts to school posted:

What's the best way to shop for term life insurance? I'm about to turn 30 and my wife and I are also planning on trying for children soon, so we want to lock in a 20-30 year policy soon.

I currently have car and house insurance through USAA but I'm not sure that they would offer the best deal.

I did a bunch of online requests for information, eventually you get back answers that start looking similar.

I hit up AAA, my local homeowners/rents insurance provider, USAA, and lifequotes.com (a multi-agency broker/search/spam engine). There is an insurance thread with some recent life insurance posts that are good, check there.

# ¿ Mar 5, 2020 00:06

H110Hawk: Dec 28, 2006

powderific posted:

Gotcha. I�m going off what my county property tax assessment is, so I�m guessing I�ll have to get an actual appraisal if I want to show increased value?

Ask them for an automated valuation model and see what they say. Otherwise it's an appraisal which could be any number. Look at comps in your area, actual sold houses. My AVM was dead on the Zestimate, but yours could be wildly different.

# ¿ Mar 5, 2020 19:55

H110Hawk: Dec 28, 2006

GWBBQ posted:

My credit score as reported by TransUnion through Chase is 605, obviously not great but 100 points higher than it was this time last year. I've started using YNAB and budgeting ahead rather than keeping track of expenses and due dates has helped me get spending under control. I'm much better with money now that I was previously (plus not being the sole source of income for mom, brother, me for most of the last 10 years is a welcome change since my brother has a good steady job and mom is getting social security) and would like a bit of guidance and a mix of info and questions.

-My credit utilization is 87% of $18570. I'm working on paying down highest interest first. I have $23k in student loans and just got a 5.45% car loan for $15k a month ago because I can't afford the time/money pit of 20-year-old cars that actively try to kill me and constantly break down.

-My oldest card was opened 14 years ago, but my credit history is 20 years because I'm an authorized user (but never use) one of my mom's cards that's 20 years old. She's at 94% of her $2000 limit on it. I haven't used the card in at least 5 years and don't know where it physically is beyond somewhere in the house. Would it be worthwhile, neutral, or negative to ask her to remove me as an authorized user to knock that utilization down but shorten my credit history? It has 100% on-time payments as far back as I can see on the report.

-I have about $1800 left on a credit account that's ~25% interest and has been closed for years because back in the early 2000s I guess it seemed like a good idea to give a college kid working part time a credit limit of 75% of his annual income and I was about as responsible as you would expect from a financially illiterate student with what I was sure I would pay off as soon as I graduated and got a real job). Do closed accounts with balances count against me more than open accounts? Does account age (13.5 years) factor into that?

-I have a $500 limit card with an annual fee of $80 but no balance that I got in 2017 to cover an emergency. Would closing it hurt me more than eating the fee because of increased utilization percentage? I also have pretty much no emergency money other than a Firestone card for car repairs.

-I have 4 hard inquiries on my credit report since 2018, one for the car loan and 3 for credit cards (all Paypal, I think they inquired twice on one of them). No derogatory marks, collections, or public records. The credit union that provided the car loan offered me a $1000 pre-approved CC with 4.9% interest for 18 months and no fee on balance transfers (no inquiry shown, but it may just not have updated), so I accepted that and am going to transfer then close a 35% interest rate card (another one pre-approved that I opened to cover an emergency) and pay it off during the introductory rate period. Also going to see if I can do multiple balance transfers and payoffs at that rate with no fee to quickly clear a couple of 30% cards since April is a 3 paycheck month for me.

-Last question, I asked the person I spoke to at the credit union about getting a card with a $15k limit with the same no fee, 4.9% for 18mo balance transfer so that I can move almost everything to that and pay it off in big chunks rather than accruing interest and slowly chipping away at existing cards with minimum payments on most of them. I doubt that they're going to give it to me considering my credit rating and utilization, so would it be a good idea to see if I can get a consolidation loan from them with a lower interest than the credit cards, cancel the two with the annual fees, then throw the rest in drawers and not touch them as I pay it off over whatever term they give me?

I think I'm generally on the right track, but whipping myself into shape from being very bad with money to trying to finally acting like an adult comes with a lot of questions and uncertainty. Adding to the stress and uncertainty is a very real possibility that this all becomes irrelevant because my mom can only kick pancreatic cancer's rear end for so long (although she's almost three years past "she might only have a few weeks left") and my half of the life insurance payout will cover everything, so as you can imagine I'm stressed the gently caress out about a lot more than just money. All that said, thanks in advance for any answers or advice, I hope my rambling summary was reasonably coherent.

Stop checking your credit score right now. If you only do good things (on time payments) it's going to go up. Having a decade of history is good, beyond that it's your actual actions that matter. The various companies have set it up so that you obsess over it, don't.

If your credit union (or Visa.com's referral service) will let you consolidate higher interest to lower interest do that. Don't worry about your student loans other than making the minimum right now.

Once you know what you are doing with the other debts call and close that card you are paying 100% interest on an $80 balance. That fee is there to be usurous to poor people with just barely any credit. If it's going to renew before you can handle the above close it before it renews.

Does that authorized user actually show up on your report as utilization and on time payments? If so yeah consider nuking it, you don't want mom to oops a payment and undo your hard work. Remember in her older age her credit matters less and less.

Otherwise keep up the good work.

# ¿ Mar 21, 2020 15:38

H110Hawk: Dec 28, 2006

Thanatosian posted:

The contract being locked out for ten years is something I heard from my mom, so it's possible she is misunderstanding something (she's usually pretty on top of this stuff, though). They refer to it as a "withdrawal charge," not a penalty, but I don't see much of a difference.

Is that an option? I did some more digging and found an annual statement on their website that has a few more numbers for the income rider:

Annual Maximum Lifetime Income Withdrawal - Level: $2,800
Annual Maximum Income Withdrawal Amount: $3,600
Income Account Value: $51,000

Is that what those are referring to? Can she pull out $3,600 a year until she hits the cap of $51,000 sort of thing? Or is it $2,800?

One of the letters references an "income rider contract," and I haven't been able to find a copy of that to download yet; I may just ask my mom to call them and request that. I feel like this poo poo is designed to be deliberately confusing.

CalPERS is one of the best state pensions out there as I understand it, at least the old contracts were. I know my city is going broke trying to pay for it. You need to conference in on a call with them. Pensions often pay a fixed amount annually. You should ask "how much will I be paid per year for the rest of my life if I leave my account alone?" Don't talk about withdrawals or anything.

# ¿ Apr 14, 2020 21:33

H110Hawk: Dec 28, 2006

IOwnCalculus posted:

I've had my main banking at online banks for probably a decade now, zero regrets. I maintain a checking account with a brick and mortar bank just to get access to their ATMs for cash deposits (and teller services maybe once a year). It's even easier now that both the main banks I use support Zelle. After the first time I sent a non-trivial amount of money between the two, I can send right up to the daily limit either direction pretty much instantly.

Even without that / before Zelle was a thing, moving money between banks is not hard. Just means you might need to plan it out a few work days in advance.

Zelle is a loving nightmare if anything goes wrong, I would suggest avoiding it if feasible. It's all the hassle of something normally going wrong, but both banks point at Zelle and Zelle then flips you off. (Based on reading peoples experiences on reddit for example.) Great when it works, but the money is just gone while you fight through layers of stupid.

OldSenileGuy posted:

Is there any downside that I'm not seeing to using an online-only savings account? I'm just wondering if there's any pitfalls that I'm missing here.

I have been "online only" for savings since like 2006, it's great. With mobile check deposit I go to the bank only to use my safe deposit box more or less. You leave a slightly larger buffer in your checking account because it's 1-3 days to move money through ACH (same as checks.) If your bank is at all normal, like Ally/CapitalOne, you can also get a "checking" account, which is just a different set of features and regulations, that gets you a ATM card. These can generally be used at "AllPoint" ATMs for free, and many banks offer fee reimbursements up to some limit per month. I leave a few hundred in there just for easy cash access at an ATM without exposing my main checking account to sketchy ATMs. I don't even carry my "main" checking account debit card, there is no use in doing so anymore. If I need more than $200 or whatever cash from an ATM I'm going to know about it before I leave the house.

Schwab gets you most of these features as well, but now you can layer on that isolation if you like. I don't have any actual checks from my Ally checking account. I also have a dedicated savings account just for paypal (aka Venmo) transactions inside Ally. Call me paranoid, I'll wait.

# ¿ Apr 26, 2020 02:07

H110Hawk: Dec 28, 2006

IOwnCalculus posted:

On one hand, I can see how that would be, on the other I have yet to have any issues of any sort. The vast, vast majority of the time I'm just using it to move my minimum safe direct deposit amount from my paycheck back to an account I actually use.

You should only use zelle to pay third parties, please just link the accounts to move the money. You don't want your paycheck to go into limbo because zelle had a bad day.

# ¿ Apr 26, 2020 02:49

H110Hawk: Dec 28, 2006

Verify that the institution you are looking at has FDIC insurance. Go to the fdic website and look them up. If they do, you should be fine.

TooMuchAbstraction posted:

If they aren't FDIC insured then I see no problem with giving them the stinkeye and refusing to let them have access to your accounts. There's a lot of companies trying to make themselves sound like banks without having to put up with the regulations that banks have, because it's so much more profitable to operate that way, but it is substantially less safe for consumers.

Literally how Elon Musk made his fortune.

# ¿ Apr 26, 2020 19:53

H110Hawk: Dec 28, 2006

OldSenileGuy posted:

This is great advice, thanks!

Is this the difference between institutions that are "member FDIC" themselves vs institutions that don't specifically say "member FDIC" but at the bottom in the fine print they say "your deposits are FDIC insured through BANKCORP" or something like that?

It seems like if the company is "member FDIC" then you're actually doing business with the bank itself and your money is insured.

If it's one of the other companies (like Varo or Chime), they are partnered with a bank that they are putting your money into but they themselves are not an FDIC insured bank? Is that right?

Companies I trust to do FDIC sweep accounts ("in partnership") : Fidelity, Schwab, Vanguard (you get the idea). People I demand be direct members? Everywhere else.

Stop chasing tenths of a % with your literal ability to keep a roof on your head.

# ¿ Apr 26, 2020 20:25

H110Hawk: Dec 28, 2006

IOwnCalculus posted:

I set up an account at a local credit union to see if they could replace my current brick and mortar bank.

They wanted to charge me loving $8 to send an ACH transfer to my online bank.

So yeah I initiated the transfer the other way around for free, but who the gently caress thinks they can charge fees for that in 2020?

That's amazing.

Also in the realm of rich person problems, make sure if you approach your fdic limits that you tell your brokerage not to sweep to the same bank you have your savings in. They will generally have a article on who they use and how to tell them to blacklist specific banks.

# ¿ Apr 26, 2020 20:34

H110Hawk: Dec 28, 2006

spwrozek posted:

This should probably go in the BWM thread but I spent $1116 on food and booze in April. That is about $550 more than normal. Also was $2300 under budget though. We have upped our eating out to support the places that are open and drinking more beer since we haven't been going anywhere. Also supporting my partner who has been out of work for 6 weeks now. Feels good to do some of that, a bit bad to spend so much on food, but also nice to see my E-Fund get bigger as a just in case.

Down to one income and went $2300 under budget? Sounds like gwm to me. Is that due to the trump bux or other savings? Or is your partner at like -$3000 for the month to offset this? (what happened to your household net budget?)

H110Hawk fucked around with this message at 16:14 on May 1, 2020

# ¿ May 1, 2020 16:12

H110Hawk: Dec 28, 2006

Just Offscreen posted:

Hey all- have a bit of a financial situation. Any input is appreciated.

My wife lost her job just before Covid, and currently qualifies under the CARES act since everything shut down the week she was expecting an offer letter for a new position. She is currently receiving unemployment benefits, and I thankfully have been able to maintain full-time employment with benefits during this time. If I understand correctly the CARES act waives the fee from withdrawing from an IRA/401k- we are making due as best we can, but we have been Bad With Money in the past and have outstanding high-interest credit card debt, on top of student loans. We had been working away with the debt snowball method, but until her industry(I won't go into the details but it has been dead in the water due to Covid) starts back up we are considering other options. We were weighing the idea cashing out at least part of the retirement fund, wiping away as much high-interest debt as we could and then pay it back to out retirements funds within two years to avoid it retroactively being taxed. The minimum payment and amount we are currently paying in interest are such that it seems like something to consider.

Is this a Very Bad Idea? A concern that immediately springs to mind is if and how this would affect my wife's unemployment status- I looked around but most of what I was able to find was pre-Covid advice so i'm not sure how that applies with the CARES act. We are in Indiana.

Thank you again.

Can you quantify what you're dealing with here? How much debt, what is your current repayment timeline when fully employed, and how awful are your 401k options? Have you truly turned your spending habits around as far as incurring new bad debt?

Generally the answer is to also bold the underlined part. But maybe you're special.

# ¿ May 3, 2020 21:10

H110Hawk: Dec 28, 2006

Hadlock posted:

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

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.

# ¿ May 28, 2020 22:43

H110Hawk: Dec 28, 2006

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.

# ¿ May 29, 2020 00:28

H110Hawk: Dec 28, 2006

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.

# ¿ Jun 16, 2020 03:07

H110Hawk: Dec 28, 2006

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.
:goonsay:

# ¿ Jun 17, 2020 15:26

H110Hawk: Dec 28, 2006

Dik Hz posted:

I'm pretty sure Ira Glass pronounces the initialism correctly too.

It would disappoint me if he didn't.

# ¿ Jun 17, 2020 21:55

H110Hawk: Dec 28, 2006

That was a feel good pro-read. :toot:

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.

# ¿ Jul 22, 2020 01:17

H110Hawk: Dec 28, 2006

BAE OF PIGS posted:

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.

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.

ESPP's are generally no brainers for as much money as you can afford.

# ¿ Jul 23, 2020 18:10

H110Hawk: Dec 28, 2006

If your credit is clean but empty try a regular card first where you bank. The rate is going to be 30% but it doesn't matter you're not going to let anything go past the due date.

# ¿ Jul 26, 2020 18:51

H110Hawk: Dec 28, 2006

MAKE NO BABBYS posted:

Chime just started to offer a credit builder card thats in beta right now, but they don't offer a regular credit card at this time.

That's fair, I'll focus more on those things.

I missed that, sorry. Just open a card anywhere that will let you to start, I would try an unsecured one to begin with so you aren't loaning a bank $500 to give you access to credit. A local credit union may offer this, and then at least you have a $500 savings account rather than a secured card. If you get denials, call in to the number and talk to the person on the phone. If that doesn't work, a secured card will always work.

# ¿ Jul 26, 2020 19:44

H110Hawk: Dec 28, 2006

The home buying thread is often mortgage chat if you want a lot of opinions as well.

Make those lenders fight to the death over your mortgage. Insist on a "Loan Estimate" from them if they make promises. There is no ticking timebomb here of the contract expiring so you can use as shady / slow of a provider as you can stand for a cheaper rate. Should be like $2k to get it done, maybe $2500. better.com will give you one just for signing up on their site - no guarantee it will be better than anyone else's but at least it is a starting point. Don't fear the credit pulls, you're shopping a mortgage and anyone who gives you guff over you being a prudent consumer of credit can gently caress off.

# ¿ Jul 31, 2020 17:13

H110Hawk: Dec 28, 2006

Jerk McJerkface posted:

Thanks for the notes, $2500 you mean for the closing costs?

All in money out of your pocket to do this. Some of it can be covered by your lender through credits (increasing your interest rate slightly.)

# ¿ Jul 31, 2020 18:28

H110Hawk: Dec 28, 2006

Refi's don't matter. If the place winds up being literally unusable you can just tell them nevermind.

# ¿ Aug 1, 2020 15:50

H110Hawk: Dec 28, 2006

DaveSauce posted:

Yeah, I'm just paranoid about giving out highly personal data to some of these places.

Remember that this info is with much worse people already (equifax et al) who have penalty free given it to criminals. Check they are licensed but I wouldn't sweat it. You original bank is likely just as bad, and God forbid you use a local attorney or accountant.

I wouldn't spend the money on that refi.

# ¿ Aug 1, 2020 16:51

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# ¿ Apr 29, 2024 09:43

H110Hawk: Dec 28, 2006

I would do another 30 year unless you have a deep need to not have a mortgage for whatever reason, in which case go for it. There is a pretty good cost of capital post a page or 3 back in the home buying thread by I think Leperflesh. It's a good read.

# ¿ Aug 2, 2020 00:20

The Something Awful Forums > Discussion > Ask/Tell > Business, Finance, and Careers > BFC Newbies Thread: 33% of the interest paid is tax delectable

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