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danielv835

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Human: I've gotten conflicted answers to this question on different forums. Here are the loans in question : * Car loan of around $13,000 at 1.9% (3 years left). * Student loan of around $7500 at 3.12%. Here are my contributions in a nutshell : * 401K : maximum employer match contribution (5%) * Roth IRA : on track to contribute the max yearly allowed. * Emergency Fund : 6-8 months saved up. * I have enough liquid to pay off both the loans above. Should I just pay them off? I'm asking because some suggest that the interest rates are low enough that I maybe better off investing the money instead. Others say just write a check for both loans.

Depends on your thought process. Debt is risk. While everything is fine and dandy now, who knows what can happen 6 months from now (unemployment, health issue, etc). So one thought is to pay it off and remove the risk from your life and go on to invest. Then if shit hits the fan, at least you won't have debt do pay! Keep in mind student loans typically are not bankruptable, so you're stuck with them for as long as you want to be. Other option is you think the $20,500 debt is acceptable risk and you invest and get returns on that money that outweigh the interest. I'm not sure there is a right or wrong answer, only which one feels right for you. If it were me, I'd just pay off the debt because I like to minimize my risk.

Interest is lower than inflation so don't pay them off, unless you don't see yourself being able to continue making payments until they are paid off. If you invest correctly you could easily make way over what you are paying in interest, therefore it makes more sense to invest.

Human: So, I have 8 primary sources of debt (most of which are student loans). I have successfully lowered minimum payments to give myself as much room possible to snowball. I know which snowball to do first as I can pay off the debt if I buckle down in about 5 months, but the others are MUCH larger. Is there a program or widely used spreadsheet that can let me know the most efficient way to attack each loan? My monthly contribution will remain largely the same, but I am not sure which order to target my payments. It would also be nice to track the progress over time, but my main concern is creating a proper pecking order when using all of my resources at paying off these debts.

http://unbury.me

So, as it turns out I'm unexpectedly getting a bonus at work for about 1k! The smallest of my 8 loans is about 1100, so I was going to pay it off at the beginning of the month. After reviewing some info here, though, I'm thinking it may be best on one of my larger student loans, which has a 20k balance at a much higher interest rate. In this case what would PF do? Pay off 1/8 loans entirely, or bring the balance down by 1k on a higher interest loan...

Human: Yesterday, the AICPA released an [infographic](http://blog.aicpa.org/2013/05/student-debt-delays-spending-saving-and-marriage-infographic.html) about our nation's student loan debt problem. I thought this subreddit would be interesting in seeing it since student loan debt/college advice comes up a lot here. Assistant: This is very important, and it's one upside economy taking, because now people actually pay attention. Human: Yes, when I graduated high school in 2006, nobody thought anything of getting student loans. It didn't help that I grew up in a financially irresponsible household. I wish I knew then what I know now. So I'm happy that we are having this problem because it means the younger generation won't grow up thinking student loans are no big deal.

I can't really fault your generation though. I went back to school for a PhD and had to fund my first semester (I should have waited another semester for my adviser to get funding but I simply hated my job too much to stay there for another 6 months). The counseling I got was terrible. No mention that $26k in unsubsidized loans would accrue interest and mean about $300 in monthly payments once I graduated (I, being older, of course looked into all this before I went for "counseling"). How can an 18 year old fathom that they will spend the rest of their lives repaying that loan? Especially when everyone puts on a cheerful face and talks about how this is investing in their future? I know no one is forcing these kids to take the loans and they should do their homework, but at the same time... they are friggin kids. Although... I did take out $17k in student loans for my first year (repaid everything but the subsidized loans). As it stands, if I keep going on the path I am on, I will have repaid all that debt by the time I graduate and have paid a grand total of $400 in interest. Sorry, had to brag, so proud of myself :)

I also graduated high school in 2006, but I just got an Associate Degree from a community college. I actually got paid to go to school (got slightly more from scholarships and grants than it cost). But, the lack of jobs and high students loans I think are making our generation more conscious of their finances in general. 10 years ago, when the money was flowing, I think people just had a mentality of "oh, I'm low on money, guess I need to make more!" Now we have the mentality of "I'll probably be low on money for a long time, and disasters can happen, I better be frugal and save."

Human: So this Friday after finally clearing all my debts public and private, I'll get my first pay check. I'll have about $600 to open up a bank account and I'd like some advice. Basically, I'm interested in what others would do if they were in the same situation. What type of account should I open Checking/savings, are there others, both? What should I look for in a bank? I'm in a big city so I've tons of options. Should I consider Credit Unions? Any simple conservative investments I should look into down the road? (I know CD's practically don't even keep up with inflation anymore) I'm sort of on a money "high" right now. I want to work and save as much as I can while my bills are at a minimum to build up a positive net worth. I used Mint.com in the past and will probably attach my future accounts. Also, for those who have been in a similar situation ie. starting from nothing (other than my fucked credit score which will probably remain that way): What would you have done differently/common mistakes to avoid? Thanks for any advice you guys can come up with.

I would get a simple, truly free checking account with no minimum balance. I use mission fed paperless. As far as budgeting, I find carrying cash to be helpful. But definitely try to make saving a game. I used to see how much I could save per month and it turned out to be a nice benchmark for any additional expenses I was considering. If you can save 300 every month, you can probably consider getting a used car.. Stuff like that. Best of luck.

Well now that your are debt free you can finally truly afford your drugs. I would suggest this time around only spending about 25% of your income on your drugs of choice. That way you can stay out of debt and enjoy your buzz.

Human: For those of you that get paid every 2 weeks rather than twice a month, what do you do when that magical extra 3rd paycheck arrives? In mint.com, my "paycheck income" section is set for 2 pay periods worth of regular time work. But May will be a 3 paycheck month for me. So will October, now that I look at the calendar. Do you budget for those extra 3 paycheck months or do you use them as windfalls? Do they go to debt, investments, or something you've been hoping to buy (video game, small vacation, etc.)... or perhaps a little bit of everything? Another question, how do you enter it in to you monthly budget? Do you augment the numbers to make your monthly budget look nice or what?

Hookers and blow.

Wake up and pee!

Human: I am doing some research on this topic and wanted to see how everybody allocates their accounts. I am 23 so looking to allow for sizable risk now. Here is what I have now: 401K (Through Fidelity) * Large Cap: 25%, .15 ER (ABF S&P500 IDX INST) * Small Cap: 25%, .85 ER (OPPHMR MS SM&MD CP Y) * Bonds: 5%, .75 ER (FA STRAT INCOME I) * International: 45% Total * (OPP DEVELOPING MKT Y = 30% 1.03 ER, THORNBURG INT VAL r5 = 15%, .99 ER) Roth IRA (Through USAA): * TR 2050: 100%, .88 ER considering moving the IRA over to Vanguard and doing the TR 2055 fund (.18 ER), but may split into index funds to reduce the fee cost. EDIT: 401K options added. [401K Options] (http://i.imgur.com/T0h72ELl.jpg) Here are my options with the current holdings in () and the Expense Ratios to the right. Large Cap: * (25%) ABF S&P500 IDX INST, ER: .15% * FRANKLIN GROWTH ADV, ER: .71% * NB SOCIALLY RESP I, ER: .71% * OPPHMR MS SELECT Y, ER: .97% * OPPHMR VALUE Y, ER: .59% Mid-Cap * JPM MID CAP EQ SEL, ER: 1.31% * PERKINS MID CP VAL I, ER: .73% * TRP MID CAP GROWTH, ER: .8% Small Cap * BLKRK SM CAP GR EQ I, ER: .82% * COL SM CAP VALUE I Z, ER: 1.1% * (25%)OPPHMR MS SM&MD CP Y, ER: .85% International * (30%)OPP DEVELOPING MKT Y, ER: 1.03% * (15%)THORNBURG INT VAL R5, ER: 1.06% Blended Investments * FA FREEDOM 2040 I, ER: .77% * FA FREEDOM 2045 I, ER: .78% * FA FREEDOM 2050 I, ER: .79% * FA FREEDOM 2055 INST, ER: .79% * FA FREEDOM INC I, ER: .47% Bond Investments Stable Value * FA STABLE VALUE, ER: .69% Income * (5%)FA STRAT INCOME, ER: .75% * PUTN HGH YLD ADV Y, ER: .79% * WFA SH DUR GOVT BD I, ER: .49%

At those prices I'd go 100% S&P Index. Everything's highly correlated, and there are no free lunches, so until you have $100K+ invested, the S&P fund is all you need.

In my 403b I do: * 90% - TRIRX (large cap US stock index) * 10% - TBIRX (bond index) I annually rebalance on my birthday, which TIAA CREF does automatically. In my Roth IRA I do: * 100% - VFIFX (Vanguard 2050 retirement fund)

Human: So I run my own business (creating online commercials) and make anywhere from $0 to $15k per month. We have a very steady stream of clients and actually complete about 4-5 projects each month (most of which pay about $2500 each). The reason it all fluctuates is because clients are at all stages of the production process (script, storyboard, voice over, artwork, animating, editing, sound design, revisions, etc.). And then we have to wait for clients to pay us. Sometimes it's quick, sometimes it's a month (we use NET30 on our contract). I know that I'm doing one really bad thing -- mixing the business money with my personal account. I plan on opening a business account and depositing client checks in there directly, then paying myself a salary each month. I use Mint, so I have a rough idea of how much I need each month, but it's so hard to break out of the habit of getting a big check in the mail and immediately depositing it and paying off bills. It always feels like a struggle from one check to the next, even though I *know* I make enough to not have to live that way. Currently, I have $10.00 in my bank account and one bill past due. But there are 4 checks in the mail on their way. Next month is going to be a good month, this month was very hard. Some more info about me, I'm 27 and planning on getting married to my girlfriend in September, 2015. I have a house waiting for me (my deceased grandparents left it to me in their will), so I really need to start saving cause I have lots of major expenses coming up. Not to mention a few years from now we'll probably be thinking about having kids. Thanks guys! Appreciate any help. :)

Save up until you can use last month's pay this month. Then use this month's pay next month. That way you know exactly how much money you have to budget with.

Ever thought of offering net10 at a 2.5% discount? Helps me some times with cash flow.

Human: I am a pharmacist. I have 90k ish student loan debt. I own my car, bike to work, don't eat out frequently. I live in Colorado and am skiing beat up skiis. I don't feel like I am living extravagantly at all. I just don't understand why I don't have any money. My parents raised my 4 siblings and I on less money then I make on my own. It feels like I should be swimming in money but instead I have only 10k in the bank after 5 years of a six figure income and have made minimal progress on my student loans. What am I doing wrong? Assistant: I have a budget but it always seems like a moving target. Basically my take home each month after taxes, health insurance ect.is about 5,800 a month, I put 800 in saving, pay 1,300 rent and $1,200 student loans. The other $2,500 just seems to go every month though it seems hard to track down where it goes exactly. I've set up budgets but it never seems to help me much for some reason.

Well that $2,500 is certainly going somewhere. Next month figure out where your $2,500 is exactly going. Make an account on Mint.com or something similar and track where your money is going and how you can cut back and whatnot.

well, you're throwing away $1300 a month in rent. If you have $10 grand in the bank, buy a small house, you have enough for a 5% downpayment on a $200,000 house and with your income, you shouldn't have a problem getting approved for a mortgage. For a 30 year mortgage at 4 percent, including average taxes, insurance and PMI, your monthly payment will be about the same as your current rent. Once you have a house you start building equity, look at it this way: with rent, you give the money to the landlord and never see it again. With mortgage/equity, you put that money into your house and you get (at least part) of it back when you sell. If the house's value appreciates, you make even more. Some people are saying pay yourself first, and if you can afford to do that, then awesome, but I would say pay those student loans first - they're going to be hanging over your head no matter your financial situation and the interest rate isn't low enough to let that happen. You can't sell your education if you lose your job. Seriously, you have the cash to double those payments if you manage it well.

Human: Reddit - how are you putting away your money? Any guidelines on how much to put into savings vs a portfolio? Right now I'm about 50/50, half in my crappy savings account and half in stocks.

50/50 isn't really the right way to look at it. Instead use your cost of living as a basis. Keep 3 to 6 months worth of expenses in your bank account for day-to-day spending and emergencies. Money that will go toward big purchases (wedding, car, house, etc) within the next 5 years or so should also go in your bank account. Everything else should go into investments. Go with a target retirement mutual fund or, if you want to do it yourself, a mix of stock and bond index finds. Put as much money as you can into tax-advantaged accounts (IRA, 401k, etc) before you put it into a standard taxable account.

Depends on what your goals are really. I split my net worth as follows - 10% cash, 10 international shares, 30 property, 50 shares (dividend blue chips). Though I have recently liquidated all my shares to buy a house so its not looking anythink like this at the moment.

Human: Hi, I'm RedRedditRabbit. You might remember me from previous posts such as "Why Invest in Bonds at All?" and "Can a Middle Class Worker Really Retire in Their 50's?". Today I'm here to tell you about my most recent calculations. Let's jump into them. Like all of my posts, we're going to start with a set of assumptions. These are made to allow for these equations to apply to the broadest market possible: the median male US worker bee with a Bachelors degree. First assumption: You will stop getting real raises in your early 40's. Lots of studies have been conducted on this, the conclusion is that eventually you'll get to a point where your raises each year are only barely keeping up with inflation. For some people it happens in their 30's for some it doesn't happen until their 50's, we're going to use a nice median age of 45. Second assumption: You started working, and saving, in your early 20's. You don't have to be saving a lot, but hopefully you were saving something. Third assumption: You won't be getting any social security. This will probably be the most debatable of the assumptions, but we're going to go ahead and plan ahead as if you won't be getting anything from SS. You can adjust these numbers if you feel like you'll be getting a certain amount, but what it boils down to is that it was a lot easier to assume you wouldn't get anything instead of doing a ton of complicated calculations to find how much you might get. Final assumption: Your investments will return a solid 5% (real) APR over the entirety of your working career. Again, if you don't agree with this, feel free to adjust up (or down) your final numbers. Lets lay out some math. We're going to use a **s**afe **w**ithdrawal **r**ate of 4% to plan your retirement years. There are lots of good arguments for and against using a 4% SWR, but, like above, we're going to use this one because it has good data behind it, and it's simple. A 4% SWR means that is you want to live on $80k per year, you would need 25x that saved up: $2,000k. Only need $30k per year? Multiply by 25 again and you get $750k. Another good multiplier to keep in mind is 80%. *Generally speaking* retirees spend about 80% of what they would have spent during their working years. So, if you're 65 years old and making $100k and saving 20% of that for retirement, that means you're spending $80k, *that* means that in retirement you'll only need $64k. So what does this all boil down to? Time for some tables! If you work for 40 years you'll need to save about 17% of your salary every year. Here's an example of someone that starts working at age 26, and wants to retire at age 65. He should have the following amount saved: Age | Salary Multiple :-- | --: 31 | 1x 37 | 2x 41 | 3x 44 | 4x 47 | 5x 51.5 | 7x 55 | 9x 58 | 11x 60.5 | 13x 65 | 17x So if you're currently 45 years old, and planning on retiring by 65, you should be saving around 17% of your salary, and have about 4-4.5x your salary saved up. (If you make $100k, you should have $400-450k saved.) If you're under that, time to start contributing more! What if we shorten that time period down? How much should you save if you want to retire in 30 years? You need to save an average of 30% of your income. Let's start at 22 this time and work until we're 51: Age | Salary Multiple :-- | --: 25 | 1x 28 | 2x 31 | 3x 34 | 4x 37 | 5x 41 | 7x 45 | 9x 47.5 | 11x 50 | 13x 51 | 14x At the age of 51, you'd be making $100k, but only spending $70k of that, meaning you'd only need $56k in retirement, which means you need $1400k saved up ($56k * 25 = 14 * $100k). Here's the formulas you can drop into excel or google to run some simulations yourself (Just don't copy the header part where it says **A B C...**): A | B | C | D | E | F | G :-- | :-- | :-- | :-- | :-- | :-- | :-- Starting Age | 22 | | Age | Salary Estimate | Saving % | Savings Estimate Current Age | 45 | | 22 | =ROUND((IF(D2<45,(D2-21)^2 * -0.0014+(D2-21) * 0.0961+0.834,2.375) * $B$5/IF($B$2<45,($B$2-21)^2 * -0.0014+($B$2-21) * 0.0961+0.834,2.375)) * IF(D2<$B$1,0,1) * IF(D2>$B$3,0,1),0) | =IF(D2<$B$1,0,IF(D2=$B$1,$B$8,0)) | =IF(D2<$B$3,E2 * F2,0) Retiring Age | 55 | | 23 | =ROUND((IF(D3<45,(D3-21)^2 * -0.0014+(D3-21) * 0.0961+0.834,2.375) * $B$5/IF($B$2<45,($B$2-21)^2 * -0.0014+($B$2-21) * 0.0961+0.834,2.375)) * IF(D3<$B$1,0,1) * IF(D3>$B$3,0,1),0) | =IF(D3<$B$1,0,IF(D3=$B$1,$B$8,IF(F2=$B$9,F2,F2+0.01))) | =IF(D3<=$B$3,E3 * F3+G2 * (1+$B$7),0) | | | 24 | =ROUND((IF(D4<45,(D4-21)^2 * -0.0014+(D4-21) * 0.0961+0.834,2.375) * $B$5/IF($B$2<45,($B$2-21)^2 * -0.0014+($B$2-21) * 0.0961+0.834,2.375)) * IF(D4<$B$1,0,1) * IF(D4>$B$3,0,1),0) | =IF(D4<$B$1,0,IF(D4=$B$1,$B$8,IF(F3=$B$9,F3,F3+0.01))) | =IF(D4<=$B$3,E4 * F4+G3 * (1+$B$7),0) Current Salary | 100000 | | 25 | =ROUND((IF(D5<45,(D5-21)^2 * -0.0014+(D5-21) * 0.0961+0.834,2.375) * $B$5/IF($B$2<45,($B$2-21)^2 * -0.0014+($B$2-21) * 0.0961+0.834,2.375)) * IF(D5<$B$1,0,1) * IF(D5>$B$3,0,1),0) | =IF(D5<$B$1,0,IF(D5=$B$1,$B$8,IF(F4=$B$9,F4,F4+0.01))) | =IF(D5<=$B$3,E5 * F5+G4 * (1+$B$7),0) | | | 26 | =ROUND((IF(D6<45,(D6-21)^2 * -0.0014+(D6-21) * 0.0961+0.834,2.375) * $B$5/IF($B$2<45,($B$2-21)^2 * -0.0014+($B$2-21) * 0.0961+0.834,2.375)) * IF(D6<$B$1,0,1) * IF(D6>$B$3,0,1),0) | =IF(D6<$B$1,0,IF(D6=$B$1,$B$8,IF(F5=$B$9,F5,F5+0.01))) | =IF(D6<=$B$3,E6 * F6+G5 * (1+$B$7),0) Real Investment Gains | 0.05 | | 27 | =ROUND((IF(D7<45,(D7-21)^2 * -0.0014+(D7-21) * 0.0961+0.834,2.375) * $B$5/IF($B$2<45,($B$2-21)^2 * -0.0014+($B$2-21) * 0.0961+0.834,2.375)) * IF(D7<$B$1,0,1) * IF(D7>$B$3,0,1),0) | =IF(D7<$B$1,0,IF(D7=$B$1,$B$8,IF(F6=$B$9,F6,F6+0.01))) | =IF(D7<=$B$3,E7 * F7+G6 * (1+$B$7),0) Start Saving % | 0.2 | | 28 | =ROUND((IF(D8<45,(D8-21)^2 * -0.0014+(D8-21) * 0.0961+0.834,2.375) * $B$5/IF($B$2<45,($B$2-21)^2 * -0.0014+($B$2-21) * 0.0961+0.834,2.375)) * IF(D8<$B$1,0,1) * IF(D8>$B$3,0,1),0) | =IF(D8<$B$1,0,IF(D8=$B$1,$B$8,IF(F7=$B$9,F7,F7+0.01))) | =IF(D8<=$B$3,E8 * F8+G7 * (1+$B$7),0) Max Saving % | 0.25 | | 29 | =ROUND((IF(D9<45,(D9-21)^2 * -0.0014+(D9-21) * 0.0961+0.834,2.375) * $B$5/IF($B$2<45,($B$2-21)^2 * -0.0014+($B$2-21) * 0.0961+0.834,2.375)) * IF(D9<$B$1,0,1) * IF(D9>$B$3,0,1),0) | =IF(D9<$B$1,0,IF(D9=$B$1,$B$8,IF(F8=$B$9,F8,F8+0.01))) | =IF(D9<=$B$3,E9 * F9+G8 * (1+$B$7),0) | | | 30 | =ROUND((IF(D10<45,(D10-21)^2 * -0.0014+(D10-21) * 0.0961+0.834,2.375) * $B$5/IF($B$2<45,($B$2-21)^2 * -0.0014+($B$2-21) * 0.0961+0.834,2.375)) * IF(D10<$B$1,0,1) * IF(D10>$B$3,0,1),0) | =IF(D10<$B$1,0,IF(D10=$B$1,$B$8,IF(F9=$B$9,F9,F9+0.01))) | =IF(D10<=$B$3,E10 * F10+G9 * (1+$B$7),0) 5% SWR: | =MAX($G$2:$G$45) * 0.05 | | 31 | =ROUND((IF(D11<45,(D11-21)^2 * -0.0014+(D11-21) * 0.0961+0.834,2.375) * $B$5/IF($B$2<45,($B$2-21)^2 * -0.0014+($B$2-21) * 0.0961+0.834,2.375)) * IF(D11<$B$1,0,1) * IF(D11>$B$3,0,1),0) | =IF(D11<$B$1,0,IF(D11=$B$1,$B$8,IF(F10=$B$9,F10,F10+0.01))) | =IF(D11<=$B$3,E11 * F11+G10 * (1+$B$7),0) 4% SWR: | =MAX($G$2:$G$45) * 0.04 | | 32 | =ROUND((IF(D12<45,(D12-21)^2 * -0.0014+(D12-21) * 0.0961+0.834,2.375) * $B$5/IF($B$2<45,($B$2-21)^2 * -0.0014+($B$2-21) * 0.0961+0.834,2.375)) * IF(D12<$B$1,0,1) * IF(D12>$B$3,0,1),0) | =IF(D12<$B$1,0,IF(D12=$B$1,$B$8,IF(F11=$B$9,F11,F11+0.01))) | =IF(D12<=$B$3,E12 * F12+G11 * (1+$B$7),0) 3% SWR: | =MAX($G$2:$G$45) * 0.03 | | 33 | =ROUND((IF(D13<45,(D13-21)^2 * -0.0014+(D13-21) * 0.0961+0.834,2.375) * $B$5/IF($B$2<45,($B$2-21)^2 * -0.0014+($B$2-21) * 0.0961+0.834,2.375)) * IF(D13<$B$1,0,1) * IF(D13>$B$3,0,1),0) | =IF(D13<$B$1,0,IF(D13=$B$1,$B$8,IF(F12=$B$9,F12,F12+0.01))) | =IF(D13<=$B$3,E13 * F13+G12 * (1+$B$7),0) Desired Retirement Salary | =MAX(E2:E45) * (1-MAX(F2:F45)) * 0.8 | | 34 | =ROUND((IF(D14<45,(D14-21)^2 * -0.0014+(D14-21) * 0.0961+0.834,2.375) * $B$5/IF($B$2<45,($B$2-21)^2 * -0.0014+($B$2-21) * 0.0961+0.834,2.375)) * IF(D14<$B$1,0,1) * IF(D14>$B$3,0,1),0) | =IF(D14<$B$1,0,IF(D14=$B$1,$B$8,IF(F13=$B$9,F13,F13+0.01))) | =IF(D14<=$B$3,E14 * F14+G13 * (1+$B$7),0) Simply drag those 4 right-most columns down to fill in the formulas up to age 65 or wherever you want to stop, and change the values in column B to whatever you want. You can adjust your saving schedule to increase in percentage every year as well. A couple of things to keep in mind. If you're married, these calculations are for a single person. If your **family** only needs $60k a year in retirement, you don't need to save that all up yourself (unless your spouse doesn't work). If you're female, your salary is more likely to cap out when you're in your late 30s, instead of mid 40's. Sorry, that's just what the research shows happens. If you want to tailor this to your own real & expected salary values instead of using the estimates go ahead, just change the numbers in the "Salary Estimate" column to whatever you want, just remember that this is in real values, so if you're going to use the salary you actually made 20 years ago don't forget the inflation. Once you drop everything into excel, it should look something like this: http://i.imgur.com/wS0JPe5.png What do you guys think? I'm hoping this will be useful to people to help them estimate out into the unknown. Don't treat this as a roadmap, it's more of a compass. It should give you an idea of whether or not you're heading in the right direction, but won't be able to tell you exactly how far you have to go.

I'm so screwed.

Would be much more convenient in a shared google doc.

Human: For the past few months I've been lurking in /r/personalfinance pretty regularly and almost every time I read through a thread Mint.com was mentioned. Today I finally broke down and created an account. I want to thank everyone who has mentioned Mint.com in this sub. It is a truely amazing website! I also suggest anyone who hasn't checked it out or doesn't know what it is to look it up! Oh, Last month I also finished paying off my Credit Card, which only had a $4,100 balance, but it feels so good not to have that hanging over my head. I owe all of this to /r/PersonalFinance! Thanks a lot!! Assistant: Next try YNAB and you'll totally have your mind blown :) Human: I just looked at it. It appears it just as a much more detailed version of the Mint.com budgeting feature. It looks very useful.

Very different tools. YNAB is much more focused on budgeting (obviously) and the future while Mint is more on trends and the past.

It has a very different approach, and one I wouldn't have come up with on my own. I've paid close attention to my finances for years, but YNAB was the first time proactive budgeting ever actually worked for me.

Human: A little background: The money came from an insurance payment due to the death of a relative and was left to me as an inheritance of sorts. I am a college student and currently have it sitting in a savings account, however I would really be interested in some sort of investment plan. I have luckily been able to keep myself to about 10K or so in student loans due to a fairly well-paying internship (around $35/hr). As of now the money is just kind of sitting around. Not sure of where to go from here! Should I pay the loans off right now?

1.withdraw in cash 2. post picture on facebook of your 15 stacks 3. get multiple likes

1. buy you something you've been wanting. new tv, watch, etc. 2. a nice dinner. 3. put the rest in a 401

Human: 27 years old. Married with one child. * $3510/month take home pay. * $145k mortgage - $1320/month (includes tax and ins.) @4.5% ($48k equity) * $26k student loan - $200/month @ 6.25% * $37k student loan - $365/month @ 7.5% * $27k cash savings * $90k 401(k) savings My wife just quit her job to stay home with our 3 month old daughter, so I'm not sure how the new money situation is going to be. She only made $30k a year, so it's not going to hit us hard. We have been living on my salary only since September of last year, and it hasn't been difficult at all. I have been saving up to pay off the $26k student loan. I didn't want to pay it off in pieces, due to having the baby recently, and I didn't know how those costs were going to be. Now that we've maxed out our deductible, I'm comfortable with paying this loan off, but that would put our emergency fund down to 0. Last year, I paid off $27k in student loans and would love to blow this one away as well. I don't feel comfortable doing that just yet. My question is, what should I do with the $27k until I have enough built up to have a $10k-15K safety net? i.e. I don't want to pay it off til November or so. Or do I just wait til I have saved enough to pay off the $37k loan plus emergency fund (another year or so from now)? Assistant: Pay the loans off as quickly as you can, and then aggressively save for your emergency fund. It may feel uncomfortable, but it's exactly what I'd do in your shoes. Human: I mean, I could pay off the loan today, but that would leave me with about $400 dollars in savings. That's a bit scary to me with a 3 month old daughter.

Yeah, I wouldn't wipe out the emergency fund, especially with only one income and a newborn baby. You're right to want to keep a safety net, but anything beyond the safety net can go towards the loans right now, then just pay as much as you can each month going forward.

There's no reward with risk, no gain without pain. You can live a risk-free live, but that's not how wealth is built.

Human: I was looking over my deductions history and noticed that as of March, 2013, I began paying federal withholding tax. I've made no changes to my W-2/4 to my knowledge, though I did just recently qualify for employee benefits around that time period this year. There were some deaths in my family last year, and I completely neglected ALL financial responsibilities. I mean ALL of them. I defaulted my student loans and forgot to pay my taxes. I usually am pretty good about that stuff... Anyways, I never had federal withholding taxes withdrawn in 2011 or 2012 (and I've worked at my current place of employment that long). Could my wages be garnished by the IRS for not paying taxes? Or could it be student loans? My payment history says NOTHING about where this money is going, and HR isn't much help. How would I figure out where this money is going? Thanks for your time. Excerpt from the deductions history: 2011 All months have no deduction or contribution records. 2012 All months have no deduction or contribution records. 2013 January .00 .00 February .00 .00 March 352.50 .00 April 161.12 .00 May 325.95 .00

It's possible your income levels changed because of the benefits, and this bumped you over the withholding amount. It would be pretty rare for a person not to have anything withheld at all. This is probably not a garnishment (as you should have seen paperwork before this).

...and welcome to the republican party.

Human: So I'm about to graduate college and am very new to being an adult; I have almost landed my dream job...a job, however, that I am not doing for the money and will be starting out around $50,000 / year. I have about $8,000 in student loans and no other debt aside from that. I would like to look into the feasibility of purchasing a new vehicle but do not know how to start looking at that...like I said, new to being a grown up. I would love a subaru BRZ at some point (~$27,000). Is it possible to purchase a new vehicle on a relatively low salary like this? Not only possible, but responsible. If so, how? And with the brief info regarding my situation is it responsible/ feasible for me? Thanks for the help!

>around $50,000 / year. >I would love a subaru BRZ at some point (~$27,000) No.

since you don't feel quite right about it, why not wait until you've truly earned it to fully experience the joy of getting a new car?

Human: So as the title of the post says I'm confused about credit. More specifically I don't understand how to obtain or build credit. I'm also not sure if I really need it. A little bit of backstory. I'm 22 and just graduated from college. I have zero debt and have a full-time job lined up making $47,000 that starts in August. I tried applying for a student credit card and a real one, but got rejected both times. I signed up for freecreditscore.com, but when they attempted to calculate my credit score there wasn't enough information. I currently pay my rent every month, pay gas, electric, and internet. I'm not sure why I don't have a credit score. Any advice you guys can give me would be great. I want to set myself up to be financially stable and successful. Thanks. Edit: Thanks for the advice everyone. I will certainly look into getting a secured credit card. I've learned a lot from this thread and I'm very grateful. Hopefully I'll be able to get something going and then I'll probably have a ton more questions later on. Thanks again!

I was in a similar situation coming out of college and got rejected by a few cards. I ended up being able to get a Chase Freedom card. I was rejected by Chase Freedom at first, but you can request a reconsideration. Since I had >$10k in savings with Chase, I was accepted after the reconsideration with the measly credit limit of $500. Good luck.

Yo if you have a gf or wife then go to a jewelry store. I personally got in with helzberg, and payin off my wife's ring helped me later get approved for a new car. A lot if times helzberg will give 12 months no interest as well. Also, if you get a solitaire ring, you can always trade it in for the exact value that you bought it. To either get a bigger solitaire or different ring. Just a different alternative to think about

Human: This is a serious issue for me right now. I am in dangerous financial shape but I think I can work out of it with a little more cash. Have been unemployed for a while, had a real good job, had a very serious and public mental breakdown which has complicated life a lot. I have one house owned free and clear worth about 65k and another could sell for 600k and owe about 140k. I am not behind on the mortgage (600k house) but may have to be soon. My plan is to sell the house I owe free and clear, will take at least 5 months to get money into my pocket. I think I have enuf saved to pay for utilities on the big house but not pay mortgage. I also have to clean up the cheap house, previous tenants owed rent and left a mess. (I plan on starting a seperate thread on foreclosure, so this thread is for the letter). I also rent out two rooms in this big house (so I need to keep current on the utilities here) and support my daughter and ex with a small monthly, but this is tangential to the issue at hand. My uncle is quite wealthy lives on the west coast. He sends me letters every 3-6 months, he knows a lot about my situation the breakdown etc. He's uncle by marriage he and my father were quite close. He tells me let me know if I need anything. I could use a cash infusion even 2 or 3k might be just enuf. Ive never asked him or anyone for money, ever. I am having some writers block and I need to write this letter. I can write well, just having trouble getting this started. How do I do this? ANy tips? I think I will say in the letter: a) thanks for all your support these last few years b) heres the problem here's my income/expenses c) here's my plan sell one house, use cash to stay afloat before they foreclose... Thank you.

Why do you even need to ask for money? You have a lot of equity in your houses which you can borrow against. I know thats generally a bad idea to do for paying mortgage bills but if you only need to float by for a short period I think its quite acceptable for the circumstances.

Asking a relative for money can be pretty tuf, I'd just come out with it, explain the situation, and ask for a loan with very clear repayment terms.

Human: I am going to be a freshman at university next year. My family doesn't really have money to pay for my college so they will be taking out the Federal Parent-PLUS Loans. I will be taking out about 19,000 in loans every year and will be leaving college with about $100,000 in debt. Is this to much?

You will regret having 100k in debt. You need to find a cheaper option.

You said somewhere in this thread that you expect a starting salary of ~$67,000 - I signed in just to tell you that you don't need a $100,000 degree to get that. I just graduated with honors and a B.S. in CS, and ~$18,000 in debt after attending a public university for four years. My starting salary was only a few thousand less than what you're targeting. EDIT: Admittedly, I got a full-tuition academic merit scholarship, just for having a certain ACT score and GPA from high school. That's why I chose the (admittedly less prestigious) school that I went to. Still, it was the easiest ~$40,000 that I've ever earned. OP says he'd receive a $5,000 academic merit scholarship at his school of choice; I'd advise him to shop around for schools which both a) have lower tuition and b) will give him even more free scholarship money.

Human: My dad bought and has paid into a small whole life insurance policy for me for a while. Recently, he's transferred ownership of the policy and the responsibility to pay for premiums to me. I'm trying to figure out whether to keep paying into this policy, or whether I'd be better off putting my money elsewhere. Let me know what you think, or if you need more info. Here's the info from my most recent benefit statement - its a "Life Paid up at 65" policy: **Values** *Current Dividend: $11.65 * Dividend has purchased additional insurance: $86.49 * Policy cash value as of June 4, 2013: $1,141.06 **Loan** * No loan against its value at this time **Coverages** * Policy Coverage $5,000 * Paid-Up Additional Insurance: $5,263.47 **Death Benefit** * Current benefit available: $10,263.47 **Premium** * $56.50 / year About me: * 26 years old, married, no kids * Make ~95 k/year in a mid-sized midwestern town * Have ~200k in term life insurance coverage (free via work) * Only debt is mortgage (~190k) **Edit:** adding info on term policy being free through work

No, you should not. In almost all instances insurance and investments are completely different animals. Insurance is only to benefit your wife based on the loss of your income. In fact, if you're comfortable at this point in your life that $200k is adequate, you could drop the whole life and not even take on additional term. Cash in what you can and pocket the premiums. Whole life policies primarily benefit the salesman in the form of huge commisions.

Only if you hate money.

Human: We are getting foreclosed in 2 days. This sucks. Advice to prospective homeowners. Do not sign the dotted line on a 0 down payment mortgage. My parents are nonethewiser. I'm not sure where I can stay yet.. http://i.imgur.com/U1Swlmc.jpg?1

Zero down payment has nothing to do with the inability to make payments. Sorry about the foreclosure.

http://www.cba.org/bc/public_media/housing/415.aspx

Human: I have been throwing around in my head the possibility of retiring around the age of 33 with 300k. I use the word retiring, but partial retirement would probably be a better term for it. I intend to have some kind of low stress minimal time commitment job of some sort to supplement my income. I am 26 currently and I make 85k a year. I have 120k in stocks and cash right now with no debt. After everything I save around 35 to 40k a year which means I'll hit my target goal around 5 to 7 years barring some unseen expense. I don't mind living in semi poverty. I don't really care to get married or have kids. I don't have any expensive hobbies, and my material needs are minimal. I'm willing to move to anywhere in the world where the costs of living would be more affordable. My main income would be the interest on the 300k which would be around 2% which leaves me with 6k a year (more specifically, my plan is to be mostly in stocks and withdraw 6k from it every year. This leaves room for some growth and protection against inflation) . I will scrounge up another 6k to 12 k with some part time gigs. How realistic would this be? EDIT: I should add that I'm a programmer by profession. I currently live in the mid west. I enjoy my job. But I also enjoy not working more. No I'm not depressed, but probably going through some sort of post modern existential mid 20's crisis. Assistant: That's enough to retire on if you're willing to move to a developing country. Otherwise, not nearly. One medical bill could wipe all of that out. Human: Yea, an unforeseen medical bill is a concern. But I figure if it comes up I'll just go out of retirement. EDIT: 300k should cover most things, and if it doesn't, I guess its time to face the grim reaper. Most people in the US don't have 300k saved up anyways so I'm in a much better situation relatively.

If you have a medical problem, you won't be able to return to work. If you want to live on just half of your current income, you will have to take about 43k a year, which sounds like what you're living on now since you're banking about 40k a year. At that rate, your savings will last about 7 years. If you expect to live another 50 years in retirement (mid 80's), then you will be living on about 6k a year until you are eligible for social security, but that won't help much because you weren't paying in to it for very long. Now I know I haven't factored in any growth (or loss) in your investments, but I also haven't calculated in the big killer of retirement funds which is inflation. You can go to sites like fidelity.com and plug your numbers into a retirement calculator that will run a Monte Carlo simulation on them. I just don't see how your numbers work.

One issue I see with this plan is that you don't "just come out of retirement" and return to a job at the same level you were at. Add recovery from an illness or injury to that and you are double fucked. If you are living abroad you'll get a job working for peanuts there. If you return to the US you might end up with a minimum wage job. $15k a year before taxes working full time while recovering from an illness or injury seems like a nice way into an early grave just from the stress of it. If not an early grave, surely a miserable life. Going from living free to being trapped in that lifestyle which is the bottom end of what you were trying to escape.

Human: Hi guys, so I just got back from apartment hunting and one of the landlords told me I should just run a credit report/score and then email that to him to save him time (and to save me money for future rent applications rather than paying a credit app fee each time) So it looks likes annualcreditreport.com is the best way to go? Anyone have experience with giving landlords credit reports and what they are looking for?

Your landlord is pretty dumb then, because doctoring an online credit report from any of the bureaus is extremely easy. Why would he trust future tenants to turn in genuine copies of their credit reports and not delete or modify derogatory entries?

Credit Karma or Credit Sesame is supposedly free. I've used credit karma it gives you an approximate credit score and lets you know of any derogatory information. That should do. Annual credit report you should save for when you are serious about working on your credit or getting a house.

Human: This interview, among other things, pushed me to run away from my high-fee 401k. Thought /r/pf might like it... Make sure you know what you're being charged. http://www.npr.org/2013/05/16/184221956/the-tricky-business-of-retirement-hidden-401-k-fees

See also: http://www.pbs.org/wgbh/pages/frontline/retirement-gamble/ Fees are amazing in their impact. I also cringe every time I hear 'oh but the adviser only charges me 1%/year' ... I mean, considering one can expect maybe 3-5% real (after inflation) returns annually on a typical portfolio, that 1% is gigantic and it compounds relentlessly (you pay it even in bad years). There is a whole huge industry, though, that has basically one goal: to convince you they aren't robbing you blind even though they are :P

We really should just get one of these linked in the side bar...

Human: Hey all. Recently I managed to acquire a job in Lansing, MI, which is roughly 1.25 hours away from my parents house in Royal Oak. Ideally, I don't want to commute that long, as that will make the work day quite a damn bit less appealing. The job starts **August 12**. I currently have no income and I've got no savings, and I'm going to be entering the world of credit card debt this summer - with that being said though, my credit score's around 750. My goal is to get my own place; I plan on getting a 1BR for around $1,000/m with an income of $54,000/yr. The rent will not be a problem, but I believe the initial deposit/1st month's payment will be. What are my options? **EDIT** From what I've read, I'm definitely lowering my rent either by roommate or by a different location. Ideally, I'd still like to live near downtown East Lansing. I'm 21 with 24k in student loans, and this is my budget: http://tinyurl.com/bztbyaf.

Is there a reason you can't get a job for the next couple months so you can start saving and keep yourself from going into credit card debt?

I pay $975/month on $75k and feel that is high. $1000/month on $26k less per year would be pushing it. I'd look for cheaper options if they exist in your location.

Human: I have trouble keeping my wife on our spending plan. We make it together each month (be-grudgingly). However, she doesn't stick to it and gives me alot of grief when I buy something expensive even though I budgeted for it. She hates talking about money. Any advice?

Don't discuss money, discuss goals and values. Do you want to be retired early? Have her stay home with the kids? Travel? Do you value spending time with family? Having fun on the weekend? Your budget should be a plan that is designed to maximize those things, not prevent you from doing them. If you want her to stick to the budget, take it out in cash, stick everything in envelopes and both of you can stick the credit cards in a drawer. If you want you can just give her a stack of cash and a list of things she needs to provide for every two weeks and let her sort out how she spends it. There's no math to be done and it's impossible to overspend unless you charge things to a credit card or take out more money.

Divorce. Can the bitch.

Human: So about 8 years ago I signed up to be an American Airlines advantage member or some such crap. I elected to receive FIVE THOUSAND FREE BONUS MILES OH MY GOD, but i was 19 and mildly financially retarded at the time so I neglected to read the fine print which stated that I also agreed to sign up for a chase credit card and purchase a minimum of $100 on it every month or else I would face a hefty fine. I got LOTS of spam mail in college so I wound up trashing loads of letters including, no doubt, the credit card. I wouldn't even open most of them and I definitely received statements from chase bank for almost six months before I finally glanced at one of them. "I have a credit card with chase?" I asked, and that was soon followed by "It has a -$648 balance?!". I quickly called up chase and reported this as fraud because I had absolutely no recollection of signing up for this card, and it wasn't until about 2 months later that I finally pieced together that the stupid airlines reward program is where I made my mistake. Anyways though - the Chase account has always showed up on my credit report. At first it showed a single missed payment about 3 months after I had signed up, but here I am 8 years later and it's showing up as completely clean with a credit limit of $22,000 (?!). I only have two bank accounts and one credit card account that I actually use, and so I think that having this extra account which now has a sterling payment history must be raising my credit score. Am I wrong in thinking this? Should I contact the credit agencies to correct this? Currently my score shows up as 792 on creditkarma, and when I applied for an auto loan 18 months ago the nice lady at the bank told me I was at 744 at the time according to her system. **tl;dr: I have an extra account which I closed ages ago but it still shows up on my credit report with a flawless payment record and a large limit. This is probably helping my score, but should I correct it (Meaning that I contact the credit unions and tell them that this account is not active/hasn't been active for some time)???** **Edit: This was actually United, not american. Also I came up with an arbitrary amount of bonus miles(5000) which may not have been the actual number of bonus miles (25,000?). I do not feel that these details are relevant to the overall question.** Assistant: >I also agreed to sign up for a chase credit card and purchase a minimum of $100 on it every month or else I would face a hefty fine. lol, what? I've never heard of that before. >Should I contact the credit agencies to correct this? Correct what, exactly? If this was 8+ years ago it's already fallen off your report, there's nothing to correct. Don't close the card by the way, the available credit limit and the length of time it's been open are helping your credit score. Edit: Are you even sure it's the same card? It sounds like you didn't really know what you were doing back then, maybe you opened two cards, and closed the one with the fee. Human: Yes I am sure. To be clear: This chase account showed up at the exact time when I had the mystery card with a negative balance, and it just never went away after i 'closed' it. When I say 'correct this' I mean the error is that my credit reports all show a chase account with a $22,000 limit. I don't care about the single late fee as that is already gone. The way the fine accrued is that they charge you $36 or some crap like that if you don't have at least $X of usage. So on month one I got charged $36, then I never paid that $36 so I was charged a 'negative balance' fee, and that process became exacerbated over the 6-7 months before I realized what was happening.

You should contact Chase and find out about the account. The peace of mind and concrete knowledge of your financial standing is much more important than your credit score. I see too many people chasing a credit score. Use credit wisely, pay your debts, the score will take care of itself. And having a reported line of credit for $22,000 open that you have no idea about is most certainly not wise behavior. sincerely, Richard Nixon

>When I say 'correct this' I mean the error is that my credit reports all show a chase account with a $22,000 limit. Well then it's unlikely to be a mistake. You probably have a chase card with a $22,000 limit somewhere. You should look into it. >The way the fine accrued is that they charge you $36 or some crap like that if you don't have at least $X of usage. Yeah, that's insane. I've never heard of a card that charged a fee if you didn't charge enough on it during the month. I wouldn't be surprised if that's no longer even legal.

Human: Original Post: This i my first post on personalfinance, so sorry if it is in the wrong format. My problem is that I'm spending way too much money on food each month. I'm spending around $200-300 a month just on myself. I'm looking for tips to cut this down as much as possible. Any help would be appreciated. Edit: I guess I should clarify. When I posted this I did not know what was a reasonable amount of money was good to spend on food. I do usually eat. Typically its McDonalds in the morning and someplace for dinner. Now that I know that $200 is a reasonable amount I'll just look into buying groceries more than eating out. Thank you for your help.

$50 a week in food does not seem unreasonable to me

Family of three here, We spend about $600 per month on groceries and household goods. We eat out once a month and that comes from a dining budget catagory.

Human: Investing in my part-time job's 401(k) (I plan on being here long enough to be vested in the 7% company match) and I am putting all of my 401(k) in this fund: https://hewitt.lipperweb.com/?Symbol=0141100003#viewall I've got my portfolio spread out in my IRA, so I use my 401k as my US Equity. I can't find any information on this fund by looking it up on Google though, or Morningstar, and I've never heard of Mellon Capital Management. But the expense ratio is absolutely insane! If you look at the prospectus you'll see that it's 0.05% which is the same as Vanguard's Admiral Shares. I was shocked when I saw this fund. Is this too good to be true? Am I missing something? Thanks!

Pretty standard for a 401k S&P 500 fund.

Very standard. Fidelity's Spartan S&P 500 fund has the exact same ratio, IIRC.

Human: Came out of left field. The good news is that I get 3 months severance and that plus my emergency fund and some non-retirement savings amounts to about 15 months of living expenses, so I'm not immediately up against the wall. However, what sort of practical things should I be thinking about doing? I have to admit that I'm a little bit unsure about what I'm going to do next.

File for unemployment ASAP. It Can take several weeks before you get your first check.

Revenge!

Human: Whenever I was younger I got a house and took the first time home buyers loan. Lost the house due to foreclosure and now have to pay the entire amount back. Most the of loan has been paid back via tax returns that I never received. Now all of a sudden I get letter in the mail stating that the IRS will start to garnish my wages. I am currently paying $610 a month for rent. I have my girlfriend, younger unemployed brother, and myself in the household. In total on bills, including rent, we average around $1,100 or so in expenses minus food. The total income is $3,200 per month. I currently am not claiming myself on my wages, claiming 0. I need to figure out what I need to do to take care of this final $3,200 that I still owe.

There's a phone number on the letter you received. Call it on Monday, and they'll help you straighten things out. It sounds like you've got plenty of income left over after expenses, so it shouldn't take too long to pay the final $3.2k.

Take up arms against the tyrants and thieves that cause your ruin.

Human: I'm looking to invest $5K into some stocks. I'm in my 20's and I'm sick of my money making 0% interest. Which website should I use?

You'd probably be better suited to ask on /r/investing .

wealthlift.com

Human: Got a new job and can't decide if I should sell my house b/c of the commute. New job is 40 miles / hour away, but with traffic probably 1.5hrs each way. I will probably lose 10-15k on the sell of the house. I have owned the home 7 years and sunk 35K into it. The loss from the sale is not even factoring in the 35K I have put into the house. If I sell I wouldn't be able to buy a new property, so I would have to rent. Probably be spending 1700 on rent for a place 5-10 minutes away from job. The only reason I am considering staying is because after maxing 401-K fully and roth I won't be saving but max 5K a year if I move. I know if I stay most of the money I will be saving would be offset by commuting cost, but at least I will be closer to paying off the home; I have 14 years left on the mortgage. Any ideas??? edit: I guess my main concern is that I probably won't be able to afford another home for at least a decade. If I hold onto the house at least I can look forward to owning a home outright in 14 years instead of starting all over again in ten years.

Could you rent out the house?

My personal belief is that a short commute is a long term investment on happiness. http://www.npr.org/2013/02/18/171926131/how-to-thrive-short-commutes-more-happy-hours Never regretted moving to trade a 1 hour commute for a 20 minute one.

Human: It seems like that's a bit of an unfair way to do matches, since the CEOs can get significantly more money out of a match than the lowly workers. Is there a tax or legal reason for doing it this way? An assumption that if you earn more you have higher retirement needs? Why wouldn't a company just say they will match the first $X you put in across the board, regardless of salary?

Because their purpose is to supposedly to help you save up for retirement. A CEO is going to be accustomed to a much more expensive lifestyle than an entry-level worker. $10k/yr would be an absolute pittance to a high-level executive. And "fair"? Why do you think a system where one employee makes hundreds of times more than another, a difference that boggles the mind, should be "fair" in this respect?

Not an answer to your question in any way, but I once attended a presentation for CPA's about retirement plans, and I got the impression the presenter wanted us to feel bad for how hard it is for CEO's and such to save for retirement because of all the upper limits to tax benefits for various types of plans. But they can still save all they want post-tax, so I don't get why I should feel bad for them...?

Human: EDIT: I have 0 student loans, live a modest life style, low cost of living in my area (Metro Detroit). After comments, I dont NEED to have a 25k car. Recently graduated with my masters degree. I have a new job having me move out to the suburbs to work in the metro area. I'll be needing a new house (rent), and a new car because my old one has 230k miles on it and doesn't have much left. Besides, I do client work so I need to keep a good impression. Finances: I make 53k/year. If I pass my CPA, which I will, I will make a 5k bonus in first paycheck. Average salary increases for my position is about 15% per year for the first 3 years. So with bonus that is 58k, 60k, 69k for my first 3 years. I have lived with my parents my entire life so I am a little ignorant on some of the daily life expenses. I am hoping that if I explain my plan to you guys, one of you with more knowledge can either confirm I am ok or make some suggestions Does this sound reasonable: Rent: 900-1000 Utilities/Cable: 300 Car: 25,000 - Looking to buy a new mid-size sedan. Might lease just so I can have something nice and purchase something 3 years later when I have some more stability in my life. Remainder should be enough to go towards gas, insurance, groceries, entertainment, etc. Am I being too conservative or spending too much? Any help I can get would be greatly appreciated, thanks.

You're an associate, you don't need an expensive car to impress the client. They couldn't care less what you drive. As long as you don't piss them off, you're golden. Just get something that is reliable with good gas mileage cause the cost of gas adds up, even if you're getting reimbursed.

Buy a used car. Even a nice used one that is about 2 or 3 years old. You will save A LOT.

Human: $376.9 million after tax

Lump sum, throw the entire pile into a 70/30 equity/bonds split. Broad based index funds, no active management. Withdraw and live off of 3% for the rest of my life leaving basically the entire amount of the winnings (in real dollar terms) to any heirs/charities/endowments I feel like creating.

Lump sum all the way. I'm pretty sure I don't have much time left.

Human: Here's the story. My boyfriend, as great of a guy as he is, is in a bit of a financial slump. He is 24, and is currently a manager at Pizza Hut, making around $8.25 an hour. He has been working since he was 14 due to a terrible home life growing up, and has not had the resources to go to school or to make his financial situation better in the long run. Currently, he brings in a little less that $800 a month, has a $90 cell phone bill, and around a $275-300 rent/utilities payment (but the lease is up next month, and he will be living with a friend until he can find a new place). He is just now paying off the debt he had for falling behind on rent, which is where all of his paycheck has been going the past few months. He has been trying to save what little money he has, but it is difficult for him to budget money and to save. He also has bad credit due to crappy parents. His dad has the same name and put my boyfriend's name on things when he was a kid and used his identity to pay for credit cards, cable bills, etc., but of course they fell behind, and now he has bad credit. He has plenty of work experience as a manager and other positions, and is a great and ethical worker, but there simply aren't any jobs available. It's not like he's living in poverty, but right in that zone where it seems that there's no way to get ahead. Living paycheck to paycheck is difficult to see him have to deal with, whenever I have my parents as a safety net. How can I help him get on track to a better financial future? Thanks so much. If more information is needed, I can provide it.

Wow, there's a LOT going on here. Here are my suggestions. To track his finances all in one place & set up a budget: http://mint.com To learn how to spend less: http://www.reddit.com/r/Frugal/ To look at his actual credit report (this is free!) and see what is really going on: https://www.annualcreditreport.com/cra/index.jsp To dispute the fraudulent credit activity: http://www.consumer.ftc.gov/articles/0151-disputing-errors-credit-reports Next, some reading.... Grab these books one at a time from the library (free) and read one-three chapters per day. Make notes. * The Complete Idiot's Guide to Getting Out of Debt by Ken Clark * The Pocket Idiot's Guide to Living on A Budget, 2nd Edition by Peter J. Sander and Jennifer Basye Sander * Debt-Free Forever: Take Control of Your Money and Your Life by Gail Vaz-Oxlade If this friend of his he is living with will let him live there for free, this is the BEST opportunity to get kickstarted out of his bad hole. So hop to it ASAP. I personally believe you should see being successful as a fun project and take it lighthearted. He (presumably) has his health, a great girlfriend, and a job... and his youth. He will do fine, so don't let it get him (or you) down. You are awesome for sticking with your man in these hard times and asking for help. (Wife her, dude!) EDIT: I forgot to add. He should sell EVERYTHING he has that isn't bolted down. He can always replace stuff later, and since he's living at a friend's for a while, no reason to haul around any extra crap.

If he's not willing to pursue legal action against his parents for ID theft, there isn't much he can do except ride the wave out. Which, depending on the circumstances, could take many years.

Human: Looking back I would have done it all differently, but this is what I'm working with. I have a Bachelor's in English, but I went back to school to get a technical certificate in Video Production. I was lucky enough to get some video production gigs right out of school, but a freelancer's income was, and still is is, a roller coaster. I'm currently working with a live event production company and they barely call me. My current income is not conducive to my student loan payments and planning for my future. I'm currently working gigs only to cover my loans. I have no savings, barely any money for any social activities, so I've recently reconfigured my spending habits. Because I want to work in production, I would like to save up money for a great camera while also putting money away for "rent". My loans top out at about $600 a month, so I need to save up a good chunk of change before I move out. I've decided to take 20% out of every check I get, put 10% toward a camera and 10% toward "the future". It's modest, but with my bills I need to start small. My goal is to continue to work freelancing jobs (because the money is great) but also find a part time or full time job. My question is where do I start? Aside from production, my skills are based in customer service. I enjoy interacting with the public and need constant stimulation to feel satisfied. Ideally, I'd like to aim high and apply to production companies in the area, but I find myself having a hard time letting them know that I will do ANYTHING. I would enjoy working as a receptionist or a production assistant. I don't want to seem desperate, but I don't want to take no for an answer either. If that doesn't work out I'm OK with taking a non-production job. My question is what are some websites I can go through to find work? I'm on Monster, but I don't think I'm utilizing it correctly. The only other place I look is Craigslist, but I'm in the Baltimore area and I'm finding that there are a lot of fake jobs on there. Any tips or advice would be appreciated. I've been extremely depressed living just to pay my student loans. I'd like to get out of my parents basement. I feel like it's only made me regress. Thanks!

Try getting a job for a company that rents professional film production equipment. Since most of the costumers will be involved in the film industry, you can meet new people and even make some connections. Even if you make minimum wage, you may make some connections that are priceless. Good luck!

English degree: not even once.

Human: I'm about a grand in the hole right now for some credit card debt that I couldn't pay because I was unemployed for a period of time. The limit was $700, and the rest is because of late charges and missed payments. I've gained employment and want to pay it off as soon as possible, but I'm wondering what this has done to my credit score, and how long it will likely take to fix it? I can provide more information if needed

Creditkarma.com Go check it out and find out. Not exact but it will give you a good idea of what damage has been done.

That depends on the status of the account. Is the account closed? Has it been charged off? Sent to a collection agency? I'm going to assume that it's been sold to a collection agency. If so, I would try and settle the debt for as little as you can, as quickly as you can. The only thing that this will do is change the collection account from unpaid to paid. While it's not going to improve your credit score, it's at least going to show creditors that you pay your obligations.

Human: I got a new job, 20k/ year. Nothing great but anything is better than nothing. What do I ask when I sign paperwork about finances? Do I ask about 401K etc, or will they tell me? this is my first job so I'm just confused about what I need to ask / know in terms of finances.

Get signed up for direct deposit of your pay check

Use this time to your advantage, there are no dumb questions. They call it onboarding for a reason, now is the time to learn!

Human: Married, only one of us has a credit card. Zero balance. 1500 limit. Should we just kill the card and live with no credit cards? I keep thinking we should keep it for an emergency, but is that really necessary? We have an emergency fund, I've been unemployed for a year, spouse is working. Things are tight, but when we use the card to avoid dipping into the emergency fund, I feel like we should have just used the fund in the first place. I hate having any balance on it. **Update:** I just want to say thanks everyone. We will keep the card, and furthermore, use it for groceries and foodstuffs; because I looked at my rewards points, (which I'd never paid attention to before) and I have over 5,000! Now I'm getting 50 bucks in cash back! Never even knew I could do that. Assistant: Having a credit card, and using it at least occasionally will help your credit score, and enable you to get better loan rates/terms in the future. The key about using a credit card is to make sure you pay it off in full ever month, so that you don't have to pay any interest. Human: OK, so my credit is really good now, thanks to previous multiple credit cards in the past. If I kill this last card and never use them again, is this going to hurt my score?

Yes.

Eventually yes, especially if you don't have any other credit accounts (like car loans and mortgages).

Human: I have 2 kids, 3 and 1. I want to set a life up for them that I never had. I feel like I am smart and quite ambitious. I love talking to people and have been told I would be good at sales. Give me some ideas I can run with. I would like to try anything! PS- when I started in the trade, the porn name thing went around. My username is the best one I came up with...I am not from Boston. Edit: I am on a nightshift, I just woke up. I want to read all these posts and effectively answer as many as I can. An oilfield directory of some kind: http://www.oildirectory.com/ -I own my house and a rental. Rental worth 330000. I charge 1750 for rent. Cash flow around 100/month -I have 30000 in RRSP's and TFSA tied up in a few stocks worth 15000 -50000 in consumer debt, most of it from starting up my company. My main goal is to get debt paid off, I would say around Christmas this will happen. I need a direction to take the $$ I would normally be paying into debt. I enjoy spending time with my children and wife, so an investment that I don't need crazy involvement with would be ideal. I like the storage unit one! I will try to help individually the people looking for contacts how to work around here, bear with me. I'm at work still and beat when I get back to my room in the morning. Only 2 days left of this shutdown though. Edit 2 Ok, I don't want to let everyone down who asks for who to contact. I am going to give some specific company names. I understand it may flood some of their HR people, but I guess that's what they want right? Triton Flint/Transfield or it's URS JV driver TES thermal energy DCM CH2M Hill Then there are the building trade unions http://www.local488.ca/ http://www.albertacarpenters.com/ http://boilermakers.ca/content/

Sounds like the type of work you do isn't going to last forever -- it's a hard lifestyle, the business is prone to booms and busts, and sounds like fairly tough labor. If that's true (e.g., you don't see yourself doing this in 10-20 years), you should spend your off time investing in yourself so that you're prepared for your next thing (and, of course, live below your means and make sensible investments so you don't build up a $200K/year lifestyle that you have to support on a $80/K second career). Learn computer programming, learn new languages, take college courses (do you have a degree?), etc.; figure out what Act 2 looks like and make yourself the guy that can get that career.

Link for where I send my resume? Also, what's the starting salary like? What? Oh, right--advice on your problem: I've got three kids myself, and will be able to offer much better advice once I get some hands-on experience on this job of which you speak.

Human: I know this has to have been asked before. But, the shear volume of student loan comments on reddit is overwhelming. I have defaulted on my student loan for years. I borrowed about 10,000 I think, but it has been turned over to a collection agency & they want about 50,000. There is no way I can pay what they want, but would like to start making some kind of payment. Do I have any kind of options? Not ruling out swallowing a bullet.

https://www.nslds.ed.gov/nslds_SA/SaFinLoginPage.do Login there and find out which and how many federal loans you currently have. Did you take out private loans? There's no way that a $10,000 loan has ballooned to a 50k repayment without tons of notices coming your way. You need to find out how much you owe and to whom, first.

Just because death is one of the only ways to forgive student loan debt doesn't make it a good option. It would leave far many more people in debt (read: your people can't buy you back with interest). I think that figuring out who your debtors are is step one

Human: I've been married just over a year to the woman of my dreams, as well as her 100k student loan debt (Fed 15k 5%, Sallie Mae 65k 8%, AES 20k 7%). I own my car, wife owes 10k on hers and a combined CC debt of 8k. Combined income of around 66k (relocated this year, new jobs). Wife has a BA in music which she uses in a job that won't pay more then 40k in the next 5 years (she loves it and i wouldn't ask her to change it). I have an AA in CRJ which I plan to turn into a psychology BA or BS in hopes that we can live comfortably when the baby making starts. I understand creating new debt is not good but it will be necessary as a means to a better career. I handle all the finances after seeing such a large whole my SO put themselves in. Currently paying $800 month in student loans and its only getting worse. My questions are: 1. Will FAFSFA deny me due to income and current debt 2. Is there a way to defer my SO student loans while I'm attending school 3. Is there a better way of going about all of this? Any advice is much appreciated Update: thank u all for the advice. I have def learned that this field of study isn't going go to get me where I want to be (even though I would love to do it). I'm guessing I'm gonna have to give in and become an engineer like my old man if I want a bachelors to pay me any money. Anyone have pros or cons for electrical/computer engineering?

You can either: > live comfortably when the baby making starts. Or > turn into a psychology BA or BS Pick which one is more important to you. A BA/BS in psychology will land you a $30k-$40k a year research job if you're lucky. You'd need a PhD or PsyD to practice, which is another 5-6 years. It's never even a break even ROI either so you'd always be worse off doing that than almost anything else. If you really want to be a psychologist, just realize it's going to be very tough financially for a very long time; possibly indefinitely. >1. Will FAFSFA deny me due to income and current debt No. >2. Is there a way to defer my SO student loans while I'm attending school No. >3. Is there a better way of going about all of this? Yes. Incurring debt isn't bad if you get a more practical bachelor's degree. It's not like it matters what your undergraduate degree is in for graduate school.

By HoH, do you mean Head of Household for filing taxes? You can only file HoH if unmarried with dependents (e.g., kids but no wife). To answer one of your questions, you can't defer your wife's loans while you're in school, unfortunately. But you should look into income based repayment on eligible loans for her while you go back to school.

Human: I'm very new to the personal finance world (haven't graduated college), and just got my start by reading "I Will Teach You to Be Rich" by Ramit Sethi. There's tons of useful advice in here, but I couldn't help but notice that all his investment advice was to use 401k's and Roth IRA's, which are both retirement funds. In my naivety, I had assumed that when people invested, they were able to get their money whenever they wanted (or at least within 10 years or so). I guess this doesn't seem to be the case. Am I misunderstanding about investments? Why do you need to invest in stocks within a Roth IRA rather than just investing? Assistant: Follow-up question: Is there a reason that Ramit doesn't include much about brokerage accounts in this book? Is it considered a bad idea to have such an account?

I don't know why Ramit doesn't mention brokerage accounts, but reading the Amazon reviews, they seem beyond the scope of this book. Brokerage accounts are not bad or good. They are a tool to use as part of investing. If you want to hold a mix of assets, say funds, etf, bonds, and individual stocks, you will need to have one. I'd say it has more to do with your investment experience level - starting out you may just have a few mutual funds, but someday you might want more options. I have a taxable account (brokerage), ROTH IRA, Traditional IRA, and Rollover Traditional IRA (for my old 401k accounts). I hold individual stocks, mutual funds, and ETFs.

it has been a while since i read it and while i dont think he went into detail on how to invest in brokerage accounts, he was pretty big on schwab investor checking with the brokerage account. The whole portion where he talked about splitting up your direct deposit and having it pay different accounts. Edit: if you read and liked sethi's book, i would suggest boggleheads guide to investing next.

Human: I notice that most of the time beginning investors are urged to invest in mutual funds/ETFs when they want to start their investing career. However, is value investing still viable in today's markets? I ask because I've recently taken an interest in Mr. Buffet's accomplishments and am reading some books to understand his philosophy. Is it simply because he's Warren Buffet? I know ETFs weren't even around during the time he started investing, but I'd like to know what you guys think. P.S. This is not in any way to diss ETFs, I actually appreciate them a lot.

For every Buffet there are thousands upon thousands of people who fail and lose money. Yeah you can try and be Buffet, but be prepared to fail more often than not.

Warren's early success was largely due to opportunities from asymmetrical information in an inefficient marketplace. He did research and found mispricings others didn't see. Nowadays with the velocity amd volume of information with the internet, the opportunities are more limited. Notice how Warren's performance in the past decade has been muted compared to his early performance. Given that he spends a lot more time researching than amateur investors, has a lot more experience, and a lot of capital to negotiate unique investment deals, he has an advantage over DIY amateur investors. Try reading Alice Schroeder's "The Snowball" for some of his early investing details.

Human: I see threads on here daily with people asking for advice on what they should do, and while that's great, it typically ends up being fairly narrow. Should I buy this car? Should I buy this house? Should I invest in this? Should I accept this job? I'd like to see if we can get something a little more negative going. What have you done that you wish you hadn't? [Mistakes](http://demotivators.despair.com/demotivational/mistakesdemotivator.jpg)

Marrying the wrong woman, best financial decision, divorcing her...

I think mine were two fold: -I didn't get serious about retirment until about 2 years ago (I'm 28) -My wife and I got a house too young (22 / 2007). I wish we would have saved up for a couple of years and then had more to put down. However I'm trying to right both mistakes by investing more into retirement and we are NOT underwater on the house.

Human: I just received a bonus of roughly 60K. By the time it hit my bank account the net amount was only around 27K. Is Uncle Sam reaching too deep into my pockets, or can I expect to get some of it back at the end of the year?

Bonuses are withheld at a flat percentage up front (typically), which is around 40% all in (35% plus payroll taxes), but their actual treatment in terms of taxable income isn't any different. So, basically yes you will get it back at year end.

Update: The bulk of missing amount was from Federal which was about 35%. There were a couple K's of IRA, State Tax, Social Security, Medicare in the mix which was an understandable amount of difference., but not as much as the Federal Tax. From experience, would anyone have a rough estimate of how much I may get back at the end of the year?

Human: Here's my situation. I currently have about 16k in credit card debt broken up the following ways: 13k @ 13% 1.5k@ 27% 1.5k @ 16% I also have a auto loan at 6.5% for 10k. I am curious about whether or not I should take out a 401(k) loan to pay off some (all?) of this debt. I am currently am 31 years old, have 70k in my 401(k), employer offers a 100% match up to 6% (which I am doing). Just wondering if it makes sense to do this? It cause me a bit of unease, because I am someone who worries about retirement. I know the reason I am in this situation is because my wife and I weren't budgeting, and just spent money all wily-nily. We are working on that to improve everything. I make about 70k a year currently (takehome is around 3400) and my expenses with debts come pretty close to that right now. ( I have some crazy utility bills which I'm trying to work through.) Thanks for the help in advance.

I'd only take the loan if you're already making progress on the debt and just want to accelerate it. Fix your budget, then once you've proven you can make progress, think about the 401k loan. If you don't fix your budget first, you'll likely just trade credit card debt for 401k debt, and then go ahead and stack up credit card debt again on top of it. If you change jobs, the loan becomes due. If you don't pay up, then it counts as income and drives up your tax bill, plus there's an additional 10% penalty tax on top of the regular income taxes. Questions you need to answer for yourself: What is the interest rate on the 401k loan? Can you still contribute to the 401k if you take a loan? How stable is your job?

I'm actually more in favor of 401k loans than most people here. I think they make sense for several situations where conventional loans aren't possible. That said, the only situation I would take the 401k loan is if you can pay it back quickly, like within a year. If you can't do that, don't take the loan. It sounds like you're on the edge, spending basically everything you take in. In that situation, I'm not sure the 401k loan is a good decision. I certainly wouldn't use it to cover the auto loan. Just do the math, figure out what you can pay back in a year, and take out that much as a 401k loan, then apply it to those retardedly high rate credit cards and cut them ALL up. There's no way your 401k is going to earn 27% in a year, so the 1.5k there is a no-brainer. As for the rest, it's not like you have to completely pay them all off. If you decided you could pay back a $5k 401k loan in a year, then you could pay off the two small credit card balances, and $2k of the bigger balance.

Human: My girlfriend received a settlement for approximately $200k. Her Uncle has it in some mutual funds that aren't performing well. She has no clue what to do with it or how to manager it and asked for my help. We've been together for 5 years, so there is a heavy element of trust. I want to start a Roth IRA and max it out each year using the Vanguard Target Retirement 2050. I want to put a majority in an index fund, so it can be passively managed and have a low expense ration. Finally, I want to have a small cache to have liquidity in case anything should arise. Not sure how much to put in here though. She doesn't really touch the money. The only time she has was to pay for tuition in school and to help her mom out with some credit card issues. How would you grade my plans and what changes, if any, would you make?

You can max the Roth IRA but that will only be about 5.5k per year at the current limit, and she has to be earning at least that much income to make those contributions. I'd recommend putting the money in the following places: 1) 6-12 month worth of expenses in an emergency fund. Return doesn't matter for this account, it's about liquidity. 2) Pay off any debt, if she has any. If it's below ~6% or so, maybe not, that's up to how she feels about clearing debt vs investing. 3) Max 2013 IRA contributions, maybe keep 5.5k more on hand for January of 2014 to max that year. 3) Open a taxable investment account with Vanguard and put the remaining money there in a TR fund. You can optimize further here if she has a 401(k), but that gets into planning out asset allocation and holding tax-efficient funds in the taxable account. Since that may be a bit much right now, a TR fund is a perfectly fine option. Also, she should be careful about paying for other peoples' debt, even family, as it will make her the next stop for any debt collectors if things go south. By paying, she's making herself responsible for that debt.

buy about 10 solid book on finances and investments and you guys read it together and learn about the market.

Human: Savings account rates for bans and credit unions are around 0.5%, so are CDs.

because the big man says to keep borrowing rates low, thus ease business borrowing more room to grow

Because there's so much cash on the market from the government that banks can buy for less , banks have no need to rely on consumer deposits to bolster their ability to loan. That's why the pay interest on savings; so they can turn around and loan your money out, and make the difference between what they're paying you (or in this case, the fed) and what they're loaning it out at in profit. Supply and demand for dollars, baby. Supply is flooded, just wait till the inflation hits :)

Human: Hello all, My mom, who is 59 years old, received $200,00 in her divorce settlement. This is her only retirement fund (neglecting social security). She has no debt, a take-home pay of $1750, and her current rent is $1100 (ridiculous, but she refuses to downgrade). She is thinking about using all of the fund to purchase a house with cash and then saving every month for retirement. I'm not sure what she should do. If she left the money in the bank and got 8% she would have $350,000 in seven years (according to an online calculator). If she bought the house she would probably save $400/month for retirement which amounts to ~$35,000 in seven years. However, she would also own a house which is worth ~$200,000 and she wouldn't have paid rent to anybody for seven years. Any of advice would be wonderful. Thanks!

She would own a house, but still have to pay utilities and property taxes, as well as maintenance. It is unliklely at her age that she can undertake the maintenance herself. As another poster indicated, she would immediately owe ordinary income taxes on $200k if this is in an IRA. She would likely only net $100-120,000 from the money. On the other hand, if she invested in a 40/60 stock bond portfolio, she could reasonably drawdown about $8,000 per year. This may tide her over until SS kicks in and then she'll have a little more breathing room.

Personally, I would invest it. Assuming 8% ROI each year, her overall wealth from investing would still be higher than if she bought a house and invested the $1100 she was paying toward rent each month (although you mentioned she would likely only invest $400).

Human: Last year I bought my wife a new civic for $19k, made a 6k downpayment, and borrowed the rest at 1.9%. Her car is now worth about $16,000, but we only owe $10,250 on it and our monthly payment is $227. If I lost my job, and my wife stays unemployed, and we need to live off our emergency fund while both of us look for work, would it be better for us to sell the Civic to get out from under the monthly payment, and then buy her a car that costs $4k or less? I could probably scrape together another $2k by selling my motorcycle as well. We have about $15k in emergency fund and if we live barebones, that would sustain us for about six months. I will also likely qualify for unemployment if I do lose my job. My thinking is that we can afford to keep the civic and keep making monthly payments, but I want to hear some second opinions. What I like about the civic is that I know all maintenance that has been done on it, that it has been in zero accidents, doesn't smell funny, and will last us forever as long as we take care of it, which we will. I'm nervous about buying a used car as they are pricier now than they ever have been, can be headaches/unreliable repair-wise, and we will need something reliable for my wife when she is looking for work and finds something.

Keep the civic. 230 a month is cheap compared to a 4k car with what problems it may have. If you still need money later when through your emergency fund then sell it.

[/r/personalfinance](http://www.reddit.com/r/personalfinance/) has lost its collective mind in its advice to you. *If you are at all mechanically inclined, you will be much better off financially selling the Civic.* Since you wouldn't be in a bind where you had to jump on a car immediately, you could take a month or so to find a good deal. Pick up a late-90's Civic for around $2k in good running condition. If you sell your current Civic for as little as $14k, that will leave you with $1k-2k for any unexpected repairs. Then you will have A) No car payment B) Lower insurance payment and C) The option of reducing your car insurance even further by getting rid of comprehensive and mere having liability insurance. All in all that will probably save you at least $300/month. The question becomes, do you expect to spend $300/mo on repairs? Not if you pick a decent car and especially not if you fix minor issues yourself. You also have the added benefit of having a motorcycle as alternative transportation in case it does need to go into the shop for a day or two. I'm not saying that you should sell the car preemptively. Hell, I wouldn't recommend selling it if you and/or your wife have good prospects immediately after the job loss, but if things stretch out more than a couple of months you should seriously consider selling it. You have a great car that will last you a long time. But if things get tight, you *will* be better off financially if you sell it. You will also have the peace of mind from knowing that if things get tight, you will never have to decide between having your electricity shut off or your car repossessed.

Human: *EDIT: It sounds like a prenup only covers what either of us has (in assets) before getting married. So, since neither of us is insanely rich or has too much debt, I don't think it would be worth getting one* **Just so we are clear: I love her and cannot imagine life without her**, but I also know that things happen and you can't predict the future. A bit of background: She and I both have a great credit score. She has about $6k worth of debt left from student loans. I have no debt and about $25k saved up and most of that is going towards a down payment on a house. Has anyone gotten a prenup and regretted it or didn't get one before and now wish you had?

You don't have significant assets to worry about this. It would be different if you had $250,000 in assets or owned 5 properties, or a combination of both. This is not meant to negate your $25K savings (congrats on that), but if you feel a pre-nup is necessary for such a small stake, either you're not ready to get married, or she isn't the one. Peeps can downvote me if they want, but I'm just stating what a lot of people are thinking. Good luck.

or greatest idea

Human: Hypothetical situation: You have no debt and you get married to someone with $100k of private educational debt at ~7% interest. This debt was created before you ever met. You both make approximately the same salary and gross about $120,000 annually between the two of you. Do you contribute to your spouse's debt repayments to accelerate the repayment schedule? Is it a good or bad idea to make such payments?

If you don't want to be part of a team, you shouldn't get married - just stay dating. You are meant to be in a marriage for the long haul, that is the point of it. That means helping with your partner with his/her debts to reduce the overall cost to your team. Paying it off quicker saves you both money.

>You have no debt and you get married to someone with $100k of private educational debt at ~7% interest. Now you have debt. Try to get in the habit of calling it *our* debt and *our* income and *our* savings and *our* goals.

Human: Hi all, thanks for taking the time to read my post. Anyways, simple and sweet, my current dilemma is that I'm a graduating senior from high school that's been making money from tutoring sporadically throughout the year. I've saved up an amount that's slightly over $600 - all of which is expendable, and if I've learned anything from my 7th grade civics class it's that just letting money sit around is really stupid and that it should be actively doing *something* for the economy. Anyways, with the understanding that I have no knowledge of investing in stocks, etc. etc. what is the best thing I can do with these $600 - other than compulsively buy a new DSLR I've been looking at...? Thanks for any and all advice and help! EDIT: Thanks all, for you comments and inputs. I figured that the $600 figure may be a tad small to do anything significant with, hence this question for r/PF - but I guess I just needed to hear it for myself. Anywho, I think I got the answer that I needed. Thanks again to all that helped!

Save the money for college. That money can be the security deposit on an apartment, an excellent quality road bicycle, or a decent used motor scooter, or groceries for a long time. If you're not going to college, save it up for whatever your plan is. Trade school? Pilot's license?

http://lazytraders.com/insights/starting-out-i-have-x-dollars-what-should-i-invest-in/

Human: I didn't seem to find anything about annual fees or crazy spikes in APR. But, curious about your input guys.

I've got it. It's pretty good. As with all credit cards, pay off your balances on time every month... No funny stuff! But yeah, it's a solid card. Totally fine.

It must be [this Amazon Visa page](http://www.amazon.com/gp/product/B007URFTYI/ref=us_creditpage_cbcc_1?ie=UTF8&plattr=CBYA&pf_rd_m=ATVPDKIKX0DER&pf_rd_s=center-4&pf_rd_r=1CAATAV0R6KR1WHXEVR3&pf_rd_t=101&pf_rd_p=1396987962&pf_rd_i=1266766011).

Human: I know I could calculate returns based on predicted performance of certain stocks/funds and realize more than 3%, but I have also lost in the market and am a bit weary. I was hoping to take the cash and make another real estate or similar type investment, but nothing has seen like a great oppy recently. mostly, I'm concerned that I have cash sitting around and not doing work for me. without a better investment option on the horizon, should I pay down my mortgage or invest? or just tie it up in a short term CD until I see a good investment? I am otherwise decently invested, solid 401k, etc. I play around a bit with selling covered options, which can be good. not sure what other info would be helpful. Edit: thanks everyone for your thoughtful comments/advice/help!!

I'm in a similar situation to you and I'm not in any hurry to pay off my low interest mortgage. All into the market, baby.

When you are paying down your mortgage you are avoiding diversification. You probably already have enough wealth tied to your home. I would continue to pay it down at the current rate. It isn't always wholly about calculating the best theoretical returns, but I still say put it in the market anyways.

Human: Started work at the start of the year and have managed to pay off my credit card debt (~3k), start paying down my student loans (~30k) and have saved one month's worth of expenses (a little over $1000). My question is now that I have a month saved up should that still be my main priority?

I would make sure to have 3months + at least, especially if you have a lot of fixed expenses (ie rent, car, insurance). So by your numbers, I would keep 3k in savings, and once that happens, aggressively attack your highest interest student loans, while also limiting expenses as best you can. Congrats on clearing the credit cards and getting a job. Your credit should skyrocket with large successful payments and low revolving debt.

Start small and build it up as you become better at living on less. When I began to monitor my money far more closely a few years ago I started at 1/15th of my salary into emergency fund. Every few months I would up it by 25-50$ a month. Once it was built up to about 6 months of living expenses I found I was far better at saving than I would have imagined. Now I am able to save more than 1/3rd of my monthly income without any noticeable decline in quality of life.

Human: Do banks cut slack? I never missed a payment but had a family emergency and will not be able to pay this months bill. What will happen? Will it just be carried over? Confused. I am not very educated about this. Don`t want my excellent credit to get ruined. need it lol.., I screenshoted my mint webpage to imgur http://imgur.com/IzzAIR1

You need to call your credit card issuer and let them know about this. They may be able to work with you. If you just miss a payment with no contact, they'll charge you a late fee and will probably raise your APR to the penalty APR (~30%). For the future, you should set up an emergency fund so emergencies don't prevent you from paying your bills.

Is there something you own that you can quickly sell on Craigslist for the minimum payment?

Human: I was hospitalized a few months ago and racked up some medical bills that I cannot afford to pay. They held me for several days when it was medically unnecessary because they had to wait for a social worker to clear me to leave and that is bullshit enough I am not willing to pay for that if I can avoid it (I paid the ER expenses that I consider valid with money I got from my parents). I have no job or income and am 100% financially dependent on my parents. I am filling our an application for financial assistance which they use to determine whether they will be willing to write off my account or not... on the application it asks whether I own a car. I have a 95 Camry that's worth a few thousand, but it's conceivable that they could come after it. If I say that I don't own a car, can they find out that I do? and will they come after it? Should I hand the title off to my dad for safe keeping until this is over?

If you say you own a dirt cheap car, they are not going to go after it. If you say you have no car when you really do, they are going to consider everything you provide as unreliable and go after you for the full amount.

You shouldn't lie about easily proven facts (especially to an organization whose job it is to check your financial records); you could lie about things that cannot be checked. EG#1: Putting on your application that you own a '95 Camry EG#2: Telling someone you don't want to hang out with that you are really swamped at work and that you can't make it to the event.

Human: I'm currently going through a divorce and as a result, I had to get my own apartment. Hours for everyone at work are being cut (poor sales in retail = no hours). I make $9.53/hour and average anywhere from 25-30 hours per week. I'm thinking of getting a second job just to make ends meet. I even have my mother help me out with money everyone once in a while, but all of it goes straight to bills. Here is everything I have to pay each month: Rent: $565 Electricity: $80 Gas: $60 Food: $100 Credit card: $220 Payment for dental work: $100 Car payment: $119 Car insurance: $68 Phone bill: $35 Cable & internet: $60 Unfortunately my credit card is over $9000 due to moving expenses or buying things for my apartment, along with paying for things for my soon to be ex-husband, as he didn't work for 2 and a half years. I've had my job for over 5 years and had to pay for everything for the two of us plus our 3 year old daughter. I'm not asking for handouts or anything. That's not what I'm trying to do (although it would be nice). I just need some advice over what I can do to not panic every week and have enough for everything I need and some of the things I want. Second job? Have three jobs? Declare bankruptcy?

Biggest problem is getting full-time equivalent employment. Get a second job for now and work on a plan to get into something more sustainable than retail sales. Your spending (which excludes some key things) is $1,407 and you're only bringing in $1.1k *gross of taxes*. Need to make some big changes; consider moving in with your parents. Can you return any of the $9,000 of things you bought for the apartment? I'm assuming a big chunk of that is furniture. Big number and you couldn't afford any of it. All your other expenses are reasonable and more or less unavoidable. Your food bill is very low. Or you eat out a lot, which you can't afford to do. You're also missing transportation costs. Certainly cut cable to save a few bucks too. You need every penny. I'd look into whatever social services are available to you; you're well below the poverty line and you have a child. Also reach out to your personal network (parents, siblings, friends, etc.) for help (not financial help).

See if you can get on some assistance programs. In the divorce settlement, make sure that you bring up the credit card debt as you may be able to make him liable for half of it. Also talk to the dentist, explain your situation, and see if you can lower those payments.

Human: I have been in the US for three years now and not having a credit score was a pain for a lot of things (apartments, dealing with banks, insurance etc). I recently got a secured card with Bank of America, the only bank that accepted my application, and I'm a bit weary... Any tips on not screwing it up? Assistant: secured card don't build credit... my mom still has a green card, and she has a solid 790 so green card holder doesn't not play any role...... Human: Every single bank refused to give me a credit card because of my non existent credit score, except the secured one - supposedly to build it up at first, so that's not true?

Secured cards do build credit. That guy has no idea what he's talking about.

Seconded, that user doesn't know what they're talking about. Secured cards are specifically designed for those with no credit or bad credit to build credit history. Use it for all your essentials that you can, pay off in full every month, or more frequently if it makes you feel better.

Human: You work at Company A; you are paid well and you like working there. Company B is interested in hiring you, either giving you an offer or giving you a chance to interview, but you are not interested in leaving your current job. How do you turn down such an offer without offending anyone?

It's never bad to listen to what others have to offer, but be upfront about it to the one requesting an interview. "I like my current position/company/whatever, but of course I'm open to opportunities". Then when/if you decide to say no, be upfront again. It's a business decision, pure and simple. If they don't like you, they won't feel any hesitation in telling you "no". It's the same for you: "I'm very thankful for the opportunity, thank you for your interest, but your offer isn't right for me at this time". It's not personal, it's business, just be frank about it and tell them no. Then thank your lucky stars that you're in a position to be telling companies "no" in this job environment.

When I was job hunting, accepted a job from one company (then of course all the other companies I never heard back from for like 3-6 months all of a sudden come out of the wood work a week or two later...) I replied with something like: > Thank you for considering me for the position of (whatever) > At this time I have already accepted a job with another company and I am extremely happy with my current employment. > If future employment opportunities arise, please feel free to contact me. Hopefully our paths will cross again in the future. > Sincerely, me.

Human: Last August, my husband and I hit a HUGE financial decision; to combine our finances or not (after 5 years of marriage keeping it separate). We did a bit both. All the bills are my responsibility, so 90% of his paycheck comes to me, the rest goes to him and savings (he never saved before, this was my rule, I needed a small amount of his check into savings). Before I go off rattling, I must thank /r/personalfinance! Shortly after we made that choice to combine, I was crying..nightly. I was overwhelmed by the responsibilities of EVERYTHING that revolved around the house, and felt like it was no longer shared, and I was breaking apart. Things we used to do together, I was doing alone, or doing alone with small children jumping in the middle. One day, I read a thread about YNAB being on sale through Steam. Mind you, I've never heard of YNAB or even Mint before that thread. Through reading everyone's reviews of the two systems, I bought it. I figured, the $20 spent here isn't going to hurt anything. And buying something so "on a whim" like that was hard for me! Months go by, I use it, I enjoy it, take a few webinars and am really starting to see the difference (even though I'm slower than the others, thank you America for high medical bills). Today, I realize we've hit several milestones. I have a car payment that I saved a third of the cost for and forgot I did, bill comes up, and I'm panicking that I can't pay extra. Then, I notice my YNAB numbers, and I can still pay extra! Then there was a moment of weakness and couldn't seem to get my YNAB numbers and bank statement to match up, it wasn't balancing and I was pulling my hair out trying to figure it all out. I was afraid I was losing that small nest egg I'm trying to build in the checking account (so we don't have to live paycheck to paycheck anymore). But, I let it go. Today, it balanced! I cashed in some change my husband has been tossing into a jar. Gave him an extra $30 and the first words out of his mouth were "I'm just going to put it into savings, I have no use for it." He's never said that! He never does that! Sorry for the wall, but I needed to share with someone how amazing you've all been for us. What I thought was going to dissolve our marriage because of the stress that was piled onto me, turned out to be the best choice I'd ever made. Thank you, so much for your support and wonderful suggestions! I'm so proud to say my husband is finally starting to save (he's never saved before) and I'm slowly starting to give us a lifestyle we deserve that I never thought we would ever see!

joyous wall of text, well done!

I'm a big fan of combining finances. I think it builds teamwork and communication. Plus, if one of you stops working, that person shouldn't feel shame for spending money. Our money, Our goals, Our Debt. *Mine* is not part of the discussion.

Human: My company matches up to 4% of your pay that you contribute to your 401k, however they do not actually deposit the money in your 401k until January of the next year. Company policy says you're 100% vested in your 401k immediately. My question is: if I left for a different job, would they still contribute the match for a partial year in January?

Based on the policy you described, probably not. IBM made the change to this type of policy last year and it made big news.

Well usually if you leave a company, you lose any employer match that wasn't vested yet. And I assume the employer match isn't vested until it's deposited into your account. So I'd guess you wouldn't get any partial match if you leave before they deposit the match into your account.

Human: Purely theoretical question here: say I had a debt, say 10k that had gone to collections, and is would keep me from getting a home mortgage. Would it be possible/legal, albeit expensive to: 1. Start an LLC 2. Register it in my state as a collection agency. 3. Contact agency that currently has my debt, and buy it from them. 4. Do a "pay to delete" on your own debt so it no longer shows up on your credit report. I know it would be complicated, just wondering if there is anything that would prevent a person from doing that.

the agency probably will not sell you just that one account... plus also you must have a LOT of insurance to open an agency.

Probably, but this seems more like a question for /r/law

Human: I understand that Im a moron, and thanks for any advice I can get. Only recently have I made more the 25,000 a year, for the majority of that time I was making 19-24,000 a year. I want to get married next year, and I need to get this cleared up, what should I do?

Tax attorney here: This is not unheard of or uncommon. If you're owed a refund, we can only go back three years to get it. If you owe the government, the statute of limitations only begins to run once you file, so you're going to owe for all years if that's the case.

I would at least calculate (basically "do" but no necessarily file) taxes for the previous 3 years. If you're not comfortable with the paperwork, go with a cheap place like H&R Block, because your situation is probably very straightforward (no itemized deductions, no self-employment, etc). With the Earned Income Credit, you are probably owed a refund, and can collect for up to 3 years. If you're owed a refund file those returns. If you owe money instead, *I* would personally still file, although you could probably get away with not filing, especially for anything older than those 3 years. At the very very least, you should file your 2012 taxes. Don't worry about 4/15 being in the past, the IRS actually gives people until October 15th to file without any verified excuse.

Human: I am 22 years old, and thinking of getting my first credit card. However, I will be moving to Japan in a month, and will be living there for at least the next 3 years. Any advice on credit cards that won't screw me on international transactions, specifically in Asia?

I believe Capital One also doesn't have foreign fees. Even if you don't get a no-fee card, you're not going to be charged an arm and a leg. Maybe things used to be bad awhile ago, but international finance has been quite smooth and seamless for some time now.

There are several cards with no foreign transaction fees. A lot of airline / hotel reward cards have no foreign transaction fees. Schwab was already mentioned. I think Chase Sapphire Preferred is one, as is Discover (but not accepted as many places). Some American Express cards don't either (but also suffer from lack of acceptance). I think most Capital One cards don't have the fees. That being said, I believe Japan is a lot more cash-based society than we are here, so what you may be more interested in is no foreign ATM fees and ATM fee reimbursement on a checking account. I think Schwab may have this as well. Citi may have an online account with these perks too, but I don't remember exactly.

Human: I've got pretty decent credit. I've got three cards that I pay off in full every month. So I got an offer for 50,000 rewards points if I get an Amex Gold card. There's no fee the first year. I'm considering getting the card for the promo and then canceling before the I have to pay the yearly fee. It seems a little too easy though. Am I missing something? Will this kill my credit score?

/r/churning

Actually there is no reason to cancel. Just call them and say you don't want the fee charged, and they will convert the card to another type with no credit ding. Ymmv but I've done this many times. (including after the fee was charged, and they refunded it.)

Human: Using a throwaway because I don't want this linked to my main account, but I'll answer (almost) any questions if this isn't enough information. I just started a new job in January. It's a salaried position in a call center. Over the past couple of months, workload has been increasing steadily to the point where I'm having to come in early and stay late every day and I've been working through lunch too. I thought that maybe it was just me and that I should be able to finish everything in a normal 8 hour day, but after talking to the other people on my team, *everyone* has been working extra hours, some people are even coming in on weekends to finish their stuff up. I don't want to sound whiny or entitled, but every other job I've had has kept track of hours, and when you went over 40 either you earned up credit time to take off early or come in late or whatever, or you got paid overtime. Have I just been really lucky with jobs in the past and this is what salaried positions are supposed to be like? I don't want to start a big fuss or anything because I really need the job, and the pay is nice, but I also don't want to be taken advantage of just because I don't know any better. I've tried searching for labor law type stuff, but I have no idea what I'm looking for... I'm in Arizona if that makes a difference. Thanks.

I just want to point out that your post is a good example of factoring free time availability when considering a job offer. People don't realize how **DRASTICALLY** important it is to have a balanced work/home life.

Are you paid very well? If so, enjoy it. Will there be tons of people lining up and beating down the door to take your job? If so, stop complaining. Can you get a better job with ease? Yes? stop complaining, change jobs. Nope? Stop complaining. enjoy your job.

Human: So this is something that gets said a lot, but doesn't seem to have many citations, so I decided to run my own tests. I checked every actively managed mutual fund that was recommended by Money in 2009 ([The "Money 70"](http://money.cnn.com/magazines/moneymag/bestfunds/2009/index.html)) and compared them to Vanguard's total stock market index over the same time period. The results were somewhat surprising. 17 of the 26 funds performed better than the index year to year, and 20 of the 26 performed better than the index over the time period examined. That's a far cry from the 10-50% number that gets thrown around a lot. Here's a huge table of each fund's yearly performance since 2000: Ticker | 2000 | 2001 | 2002 | 2003 | 2004 | 2005 | 2006 | 2007 | 2008 | 2009 | 2010 | 2011 | 2012 | Total :-- | --: | --: | --: | --: | --: | --: | --: | --: | --: | --: | --: | --: | --: | --: **VTSMX** | **-11.32%** | **-6.79%** | **-20.32%** | **27.26%** | **9.69%** | **12.28%** | **10.81%** | **1.84%** | **-32.36%** | **28.46%** | **15.07%** | **1.49%** | **17.73%** | **39.17%** - | - | - | - | - | - | - | - | - | - | - | - | - | - | - AMRMX | -0.21% | 2.19% | -14.19% | 16.73% | 6.65% | 3.31% | 8.27% | -6.02% | -28.35% | 20.25% | 8.33% | 2.24% | 11.52% | 21.85% SSHFX | 10.09% | -3.79% | -13.10% | 26.49% | 6.87% | 5.23% | 3.32% | -11.11% | -32.11% | 26.12% | 9.36% | -6.39% | 18.58% | 24.97% VWNFX | 11.40% | -0.39% | -14.98% | 26.04% | 16.20% | 10.92% | 8.74% | -10.38% | -32.28% | 26.40% | 9.36% | 2.79% | 18.10% | 69.74% FAIRX | 41.87% | 6.67% | -1.37% | 23.37% | 19.15% | 15.85% | 9.26% | 12.34% | -28.73% | 41.34% | 13.13% | -35.16% | 37.14% | 216.16% FMIHX | - | - | -11.02% | 27.31% | 14.08% | 12.90% | 11.16% | -1.21% | -22.61% | 28.00% | 10.82% | -0.71% | 14.23% | 99.50% SLASX | 0.00% | -9.98% | -16.65% | 26.91% | 9.27% | 14.10% | 10.39% | 0.53% | -35.65% | 29.78% | 8.78% | -3.48% | 7.39% | 24.07% AMCPX | -4.73% | -6.51% | -18.45% | 25.77% | 6.55% | 9.45% | 2.55% | -3.44% | -35.69% | 36.57% | 11.69% | 0.89% | 15.79% | 20.89% JENSX | 13.12% | 6.71% | -9.42% | 12.15% | 5.57% | 1.05% | 12.16% | 3.29% | -24.79% | 26.24% | 10.75% | -0.39% | 15.38% | 83.16% TRBCX | -7.65% | -10.27% | -22.39% | 25.01% | 6.41% | 11.78% | 5.66% | 8.30% | -38.43% | 40.52% | 15.64% | 2.07% | 18.98% | 32.97% FDVLX | 5.88% | 14.74% | -9.37% | 30.82% | 10.71% | 14.01% | 1.99% | -11.06% | -41.88% | 44.51% | 16.15% | -6.74% | 21.80% | 82.72% JMCVX | 17.86% | 20.46% | -12.93% | 37.92% | 9.31% | 10.29% | 5.24% | 0.35% | -26.51% | 30.08% | 12.18% | -2.60% | 10.91% | 151.48% FAMVX | 17.73% | 15.19% | -5.06% | 19.30% | 14.01% | 9.41% | 2.88% | -12.01% | -24.25% | 22.73% | 15.46% | -0.74% | 14.48% | 111.53% FPPFX | 6.12% | 14.01% | -11.48% | 29.83% | 11.76% | 18.21% | -3.30% | -5.39% | -34.37% | 47.76% | 19.29% | -3.07% | 9.83% | 106.94% MERDX | 14.68% | 6.35% | -19.21% | 45.39% | 8.12% | 6.71% | 7.04% | -1.69% | -28.11% | 34.71% | 28.76% | -5.91% | 14.61% | 133.87% POAGX | - | - | - | - | - | 21.46% | 13.68% | -5.78% | -28.86% | 50.42% | 17.00% | -0.65% | 22.28% | 97.87% PNVDX | - | - | - | 27.35% | 10.37% | 12.05% | 3.84% | -5.91% | -21.55% | 24.81% | 21.15% | 3.34% | 13.00% | 113.12% TASCX | 12.95% | 16.28% | -10.61% | 36.75% | 15.01% | 15.12% | 2.68% | -10.85% | -31.10% | 26.91% | 12.95% | -5.03% | 16.94% | 113.43% PENNX | -4.90% | 10.44% | -10.65% | 32.94% | 8.41% | 15.20% | 2.42% | -10.17% | -30.83% | 37.63% | 19.83% | -2.48% | 9.09% | 73.97% RYVPX | - | - | -14.66% | 76.37% | 20.14% | 23.59% | 11.32% | -2.91% | -37.28% | 42.52% | 14.47% | -6.70% | 15.52% | 166.43% PRNHX | -16.44% | 2.47% | -25.65% | 46.64% | 13.15% | 17.16% | -3.40% | -9.20% | -36.83% | 44.44% | 27.55% | -7.13% | 9.66% | 28.68% BRAGX | 5.05% | -6.46% | -14.94% | 49.59% | 7.57% | 25.92% | -0.33% | 20.62% | -52.96% | 24.04% | 14.90% | -9.47% | 22.63% | 51.55% MUHLX | 29.73% | 9.96% | -18.02% | 42.24% | 20.69% | 15.95% | -1.54% | -11.66% | -35.74% | 31.73% | 4.22% | -4.63% | 4.77% | 78.46% WEHIX | -11.60% | -2.22% | -31.02% | 48.13% | 18.81% | 5.44% | 19.36% | -17.05% | -36.94% | 36.71% | 34.43% | 3.45% | 19.79% | 57.31% CSRSX | 16.04% | 2.29% | -1.99% | 26.68% | 19.06% | 14.82% | 16.08% | -38.21% | -33.65% | 30.43% | 23.23% | 4.34% | 8.29% | 74.14% TAREX | 29.55% | 15.24% | 2.98% | 33.21% | 22.87% | 15.83% | 14.01% | -22.01% | -40.59% | 36.90% | 18.23% | -12.96% | 25.86% | 173.07% PRNEX | 7.39% | -6.29% | -5.27% | 29.71% | 17.66% | 34.60% | 0.53% | 38.34% | -47.86% | 49.43% | 10.59% | -17.20% | 0.65% | 95.56% Here are some cluttered graphs: [Yearly Returns](http://i.imgur.com/5rsqirl.png) [Cumulative Returns](http://i.imgur.com/j77be7p.png) Here's the list of all the funds: Fund Name | Ticker | Expense Ratio | Strategy | Annualized Returns | 2009-Present :-- | :-- | --: | :-- | --: | --: Vanguard Total Stock Market Index Fund | VTSMX | 0.17% | Total Stocks | 2.57% | 17.02% - | - | - | - | - | - American Funds American Mutual Fund | AMRMX | 0.63% | Value | 1.53% | 12.32% Sound Shore Fund | SSHFX | 0.94% | Value | 1.73% | 14.15% Windsor II Fund | VWNFX | 0.35% | Value | 4.15% | 15.78% Fairholme Fund | FAIRX | 1.00% | Blend | 9.26% | 12.62% FMI Large Cap Fund | FMIHX | 0.96% | Blend | 6.48% | 14.79% Selected American Shares Fund | SLASX | 0.95% | Blend | 1.67% | 11.96% American Funds AMCAP Fund | AMCPX | 0.74% | Growth | 1.47% | 17.32% Jensen Quality Growth Fund | JENSX | 0.91% | Growth | 4.77% | 14.38% T. Rowe Price Blue Chip Growth Fund | TRBCX | 0.76% | Growth | 2.22% | 19.55% Fidelity Value Fund | FDVLX | 0.68% | Value | 4.75% | 19.47% Perkins Mid Cap Value Fund | JMCVX | 0.84% | Value | 7.35% | 13.59% Fenimore Asset Management Trust Value Fund | FAMVX | 1.22% | Blend | 5.93% | 14.51% FPA Perennial Fund | FPPFX | 1.02% | Growth | 5.75% | 18.79% Meridian Growth Fund | MERDX | 0.85% | Growth | 6.75% | 17.52% PRIMECAP Odyssey Aggressive Growth Fund | POAGX | 0.68% | Growth | 8.90% | 23.83% AllianzGI NFJ Small-Cap Value Fund | PNVDX | 1.22% | Value | 7.86% | 16.45% Third Avenue Small Cap Value Fund | TASCX | 1.13% | Blend | 6.01% | 13.64% Royce Pennsylvania Mutual Fund | PENNX | 0.91% | Blend | 4.35% | 15.89% Royce Value Plus Fund | RYVPX | 1.45% | Growth | 9.32% | 15.95% T. Rowe Price New Horizons Fund | PRNHX | 0.80% | Growth | 1.96% | 19.08% Bridgeway Aggressive Investors 1 Fund | BRAGX | 1.33% | Multi | 3.25% | 15.08% Muhlenkamp Fund | MUHLX | 1.27% | Multi | 4.56% | 10.80% Weitz Series Fund Hickory Fund | WEHIX | 1.28% | Multi | 3.55% | 23.04% Cohen & Steers Realty Shares Fund | CSRSX | 1.00% | Specialty | 4.36% | 17.35% Third Avenue Real Estate Value Fund | TAREX | 1.09% | Specialty | 8.03% | 15.91% T. Rowe Price New Era Fund | PRNEX | 0.67% | Specialty | 5.29% | 8.49% Vanguard 500 Index Fund | VFINX | 0.17% | Large Cap Index | 1.84% | 16.18% This may result in a bit of controversy, so let me stem it a little bit. Obviously this isn't every possible mutual fund out there; these are just the stock based funds that were recommended back in 2009 by Money. **I am in no way implying that actively managed funds are better choices than passive indexes.** Secondly, this data set is fairly narrow. The data only goes back to 2000, and 4 of the funds chosen were created post-2000. Yearly returns were calculated based on reinvested dividends and fund price on the first trading Friday of each year. Comparisons for funds that were created post 2000 were compared year by year to the total stock index (IOW: FMIHX was only compared from 2002-2012 to VTSMX from 2002-2012). **I also threw in how each fund has done since the article was posted, annualized returns since Jan 1, 2009 to present. Only 9 of the 26 funds have beaten the total stock index. I think this more than proves that people are good at picking funds that have performed well in the past, and poor at picking funds that will perform well in the future.** [Here's how the funds have done since 2009.](http://i.imgur.com/u6SJfFD.png) Hopefully you all find this data as interesting as I do.

Nice posting :) Another measure to performance of similar assets is the [Sharpe Ratio.](http://en.wikipedia.org/wiki/Sharpe_ratio#Use_in_finance) *The Sharpe ratio characterizes how well the return of an asset compensates the investor for the risk taken. When comparing two assets versus a common benchmark, the one with a higher Sharpe ratio provides better return for the same risk (or, equivalently, the same return for lower risk).* |Ticker|3-Year Sharpe| |:-----|:--------------| |PRNHX|1.16 |WEHIX|1.09 |AMRMX|1.04 |CSRSX|1.00 |MERDX|0.97 |VFINX|0.90 |PNVDX|0.89 |**VTSMX**|**0.89** |TRBCX|0.87 |POAGX|0.86 |FAMVX|0.84 |FMIHX|0.83 |VWNFX|0.79 |JENSX|0.78 |FDVLX|0.78 |AMCPX|0.77 |TASCX|0.77 |PENNX|0.74 |TAREX|0.74 |FPPFX|0.73 |SLASX|0.67 |JMCVX|0.66 |SSHFX|0.63 |BRAGX|0.63 |RYVPX|0.55 |MUHLX|0.53 |PRNEX|0.30 |FAIRX|0.25 Source: [Yahoo Finance](http://finance.yahoo.com/q/rk?s=VTSMX+Risk)

A more useful analysis for investors would be to examine similar "best funds" articles from many years ago and compare the performance of those funds going forward to see if overperforming funds continued to consistenly overperform in future years.

Human: Hey Reddit, I recently left a job and have a 401k that I want to rollover, ideally into my Roth. But I have already made my Roth contribution for 2013. Does this matter? Can I still roll over the 401k into my Roth in 2013? Thanks.

rollovers don't count towards the contribution limit

Or just keep both. Do high-risk investments in the Roth so when you hit it big you don't have to pay tax on the earnings. Keep the low-risk ones in the regular 401k and cash out the year congress lowers taxes.

Human: I'm aware that taking out a loan will likely cause a score to drop in the interim, but would it make sense to take one out, use the money to only pay back the loan (plus minimal interest)? The new loan category would be a boost to ones rating I assume. In my case, I can't do much to increase my score at the moment, I have low utilization, several credit cards, paid off auto loan. According to credit karma, biggest hits are age of history and total accounts. Should i go open 12 more credit accounts? (I'm not getting a mortgage or auto loan...)

There is no need to pay interest to increase your credit score. What's you current score and why do you want to increase it?

Why are you trying to raise your credit score?

Human: Just looking for any opinions on this. I am 25 and started at a company 6 years ago in July. I started at $10.30 and moved up twice, to $19.23 right now. My last raise was from 17.40 to the 19, and my boss repeatedly said I am nearing the cap for my position (accounts receivable collector). She advised I go to college to get a degree and strive for something higher, like a manager position etc. I'm very wary (she told me this at last year's review also but I didnt do it.. I feel weird not taking her advice again) but I am wary because I personally know many friends with degrees who make less than me, or an amount more that doesn't even feel like a degree would be worth it. I should be getting 40K~ at 19.23 an hour now, and even if someone told me I would make 80K with a degree... the stress and cost of college still wouldnt be worth it IMO. I will not have kids/dependants, so I feel 'safe' at 40K. But since I'm reaching a cap in my position, I'm not sure if 40-45K will be okay with me in 20 years. I just really feel like degrees are such a waste of sanity (i went through horrible stress/depression/suicide attempts and dropped out) and money. I'm living pretty okay on 40K and when my friends with degrees, who had huge school loans, are making <45K and they're 5-10 years older than me--- I feel like I'm not in a bad position. I'll be blunt and say I don't care about my education - I enjoy learning on my own but not in a test/grade environment. So a degree for me to me would be purely for financial salary gain.. Any opinions out there please? Thanks!

You could get a 4-year state degree for $25,000 that, according to your calculations, would allow you to make $40,000 more each year for the next 40. And you're questioning whether its "worth it" or not? Really?

It sounds like you're somewhat school-phobic (bad experiences in the past?) and don't really know what options there are among types of colleges and degree programs. Find the right college/program and you could have the time of your life, especially as a more mature adult than the typical college student. Most people I know in their late 20s who didn't go to college are tied down with family, mortgages, and car payments or they'd drop it all and go to school asap because they've realized what they missed out on. That said, you certainly don't want to pursue a degree right now if it's of no interest. College need not be stressful and can be a life-changing positive experience. But for students who feel they don't want to be there or are being forced (by parents, economics, employer, etc.) it can be less than pleasant. Financially you're at an age where there's more than enough time to recoup the investment, especially if you've already maxed out your earning potential without a degree. Perhaps the first step would be to take a single class (at night or on weekends) in a field that interests you to see if going back to school might not be as bad as you fear?

Human: * My roommate and I both have different jobs at different companies. * We are both planning on travelling to the same conference because we are in the same industry. * The conference is 200 miles away and we plan on carpooling there and back. * Both of our companies provide for travel reimbursement without receipts if you claim mileage travel. * Can we carpool there and then both claim a mileage reimbursement from our two companies, even though only one of our cars is being used? * Is this legal? Will anyone ever find out, and if so, how?

It's certainly unethical and probably illegal. Ask yourself, is it worth risking losing your job and hurting your professional reputation for $50?

It's fraud, you can go do jail for it, and many people have.

Human: My wife and I were going to receive a $3k federal tax refund this year. After waiting about a month to receive it, we received a notice from the IRS saying the Dept of Education had taken the refund to offset past debts. After calling the DoE, they are saying she had two outstanding federal student loans, that had been sent to a collections agency. However, her grandmother paid off all of her federal and private student loans 3 years ago, and her credit report reflects this. After calling the DoE a second time, this operator named a different collections agency that was servicing the loans. This operator was also able to tell us more information about where the loan was dispersed, and it was the same university that my wife went to. The whole thing seems very confusing. My first instinct was to proceed very carefully in case it is a scam. I'm also wondering if there is some kind of identity theft going on? What does PF recommend as the next steps? I think this goes beyond the realm of a tax attorney, but not sure where to begin to get answers. **EDIT:** The other thing very strange to me is that her wages were never garnished. Wouldn't wages be garnished before they went after the tax refund?? Assistant: I would log into the NSLDS and view all loans they show active. Then compare all of those loans to the payoff information. https://www.nslds.ed.gov/nslds_SA/ Human: One of the sites that the DoE operator told us to go to was: https://www.myeddebt.com/ It isn't a .gov domain so I thought maybe it was a scam?

No they changed to the stupid .com sites for some reason. That site seems legitimate, but I would caution you to tread carefully.

Here's the official website I use for my loans. https://www.myedaccount.com/accounts/

Human: Title says it all. I belong to a credit union, but an outside company does all their credit card business so my APR comes when I apply for a card and it tells me what it will be. Right now it's around 18%. When it comes to paying stuff off I'm very good with being timely and never having late fees. So should I go to a certain bank and apply for a credit card there? Should I look online? Any advice would be greatly appreciated. Edit: I've gotten some questions about why I need this. I work freelance and I sometimes don't (more like am unable to work) for up to 3 months at a time. I have a savings for back up. So maybe a follow up question; would a credit card with benefits like cash back, but a higher APR, be a good idea? Assistant: If you pay off timely, why do you care about APR? Human: Good question. I work freelance, so there is a slight chance I may not always pay off my debt in a timely fashion. I'm pretty conservative with money, and I try to not let that happen. But I don't have as steady of an income as most working folk. Assistant: Wouldn't it be wiser, safer and cheaper to build up a savings buffer instead of paying credit card interest then? This is instead of technically spending money you don't have. Human: This is also what I am doing. Sometimes I go 3 months with no work so it would be nice to have some sort of safety net.

Typical /r/personalfinance wisdom dictates that you should have a 3-6 month emergency fund in place. Work on that, and then you won't have to worry about the APR on your credit card. In answer to your original question, if you want a low APR card, you pretty much have to churn them. Typically cards offer low introductory rates for the first year, and then it's either an immediate jump to a higher APR or a slow creep (adding a few percent per year). So if you're really concerned about this (and as I said, there are better ways to pay your living expenses than to rely on a credit card), you could theoretically apply for a new 0% APR credit card every 12 months or whatever.

Unfortunately, credit cards are not a good safety net. You're at the mercy of the bank, who can (and will) cut your credit limit and/or increase your APR at exactly the moment you need it most. Use them if it comes down to it, but don't plan on doing so.

Human: hi everyone, thanks in advance for your advice. I'm in a pretty hopeless situation so looking for help. I knew I really had a problem when I have not had a single penny for the last 2 weeks and had to rely on friends for survival. Here is my situation: I'm 31 y/o Income 55K per year, take home per month is around $2500.00 Debt: Here is the problem the minimum payments are starting to add up and are living little and little to live on. Credit card 1: Balance: $10,000 9.9% Minimum payment $302.00 Credit card 2: Balance: $12,959.64 17.24% Minimum payment $313.00 Private Loan: Balance: $17,284.33 10.375% Minimum payment $175.83 Living Expenses: Rent: $500 Child support for one child $500 Groceries per month $200.00 Cell Phone: $60.00 Utilities: $50.00 I get paid once a month, so after paying all my bills in the first week i'm left with $400.00 for the rest of the month, for eating out, entertaininment, gas for car, clothes, and other misc expenses. I took out a payday loan and was trapped in a endless payday loan cycle for about 6 months where I had to keep taking out a payday loan to pay the last payday loan. Think I will be free from this cycle in June. My question is are there any good debt management programs out there that people can recommend? Also, when should I think about declaring bankruptcy because I'm struggling right now just to meet the minimum payments. I want to save money so I can plan for my son's future, but I'm falling deeper and deeper into debt each month. I'm looking for a way to climb out of this debt hole. Each month, I take a cash advance of $200.00 from one credit card b/c I cannot make it through the month. This is a big sign that I need to get my financial house in order. Even with that added $200.00 I still was only able to make it to May 15, 2013 before I was down to $13.00 in my checking account. I have no savings, and no other funds that I could access, so I had to rely on the kindness of friends for the past 2 weeks for survival.

You don't get entertainment if you are broke. You don't get to eat out if you are broke. Some of your credit cards aren't going to get paid. Your food lights and shelter come first. Child support goes in the necessity category as well. The first step to getting out of debt is to stop borrowing. Advances and payday loans are just getting you deeper. Stop. Cut up the damn cards, and one or more of them are just going to have to wait to get paid. Your entertainment from now until this is fixed should be something like [this](http://www.amazon.com/Total-Money-Makeover-Financial-Fitness/dp/159555078X).

I have not been in a position to need to read the book, but I'd suggest Dave Ramsey's Total Money Makeover/Debt Snowball; be forewarned, I think he is a bit religious so there is that tone to his book. But has some pretty sound advice.

Human: My wife and I are looking to buy our first house this summer. We have saved a 20% down payment and we're hunting for the best mortgage rates. We can get a 3.75% rate on a 30 year fixed, or a 2.875% rate on a 15 year fixed. We are pretty sure that we will want to move/buy a bigger house in 5-10 years. If we can comfortably make either payment, which is the better choice? Would it be better to choose the 30 year fixed and invest the rest (we are young and can tolerate risk in our investments)? Would investing in equity in the home with the 15 year fixed be a better option? I was always taught that with low interest rates, you would be better off paying the loan slowly and finding a good investment with a high rate of return with your money, but the low 15 year rates are tempting! Edit: Thanks for all the info and opinions. We have some more research to do, but this helps a lot.

Another point to think about. Moving does not necessarily mean selling the house. When you move, your house may just become part of your portfolio of investments, generating rent.

Your results may vary, but my re-fi from a 30 to 15 year loan less than 2 years after the original purchase, was the best financial move I ever made. We lived there 9 more years and, between appreciation and equity growth, we were able to buy our next home free & clear. What used to go to the mortgage company every month has been going into our retirement accounts for the last 10 years.

Human: 31 y/o, married, no kids. Annual income (combined) is 110k. Wife is a grad student (earns ~20k), I am a patent agent (~90k). Live in very high cost metropolitan area (rent). Basically, I never struggle to pay rent or anything, but I do not see how it will be possible to "get ahead" in life if I keep on the path I am on, unless I stay on it for a long time. My job is "stable" but I cannot leave the firm I am with (very weak academic pedigree, but a good worker who has proven himself) and do not have any skills beyond esoteric patent prosecution skills that are only relevant in a law firm environment. So my salary is basically fixed and not going anywhere. I work 60-70 hrs/wk, so no time to go back to school or learn anything new. Wife has years left on her PhD (but at least she is getting paid). We live very very modestly - tiny one bedroom apt. in a bad area (like, I saw a guy shooting heroin behind my apt. building a few days ago, bad) and don't have much debt (only my student loans). We don't have any possessions of any value to sell (iphones and decent laptops, an oldish TV setup, but everything else in the apt. is used Ikea furniture and things from craigslist). Recently paid off all our cc debt and final car payment, so we are really only starting to save now, but it seems like it will take forever to own a first home or anything like that. What am I doing wrong? Here's our monthly budget: Rent: $1100 Car Ins.: $130 Student Loans: $350 Groceries: $480 Dining Out/Activities: $300 Transit: $190 ($100 for gas/mo.; $90 for her subway pass) Pets: $50 Cell Phones: $160 Internet: $30 Netflix: $7 Gym: $75 Other (haircuts, etc.): $50 Total: ~2950/mo Other "expenses" (savings) per month: 401k contribution: $400/mo Roth IRA contribution: $400/mo Cash savings: $2k/mo Assets as of now: 401k: 30k Roth: 6k Savings: 6k Car: low mileage Japanese car in good shape Debts: Student Loan: 40k I can max my 401k and Roth contributions every year going forward at bonus time. Small houses in the area go for about 400k, so I would need 80k for the down payment and would need another 20k in reserve to be safe. On my current path I will be 35 years old+ before I have this, assuming nothing goes wrong in the interim. We both come from very poor families, so getting a loan from family for a downpayment is not possible. Basically, I see my peers buying large homes, driving better cars, having children and going to Hawaii a few times a year, but I cannot afford these things and do not know what I am doing wrong. My wife and I never go on vacation (maybe camp once a year in a national forest or something) and don't do anything else lavish, just a dinner out here and there, but eat at home almost every day. I bring a bag lunch from home every day, go weeks without spending anything. Did I just start out too late? How do you get ahead in life without a big windfall somewhere? Or do I need to accept the fact that I will not own a home until I am 35+? How can we have children if we cannot afford a home, let alone daycare, etc.? Not trying to be whiny, I know are situation is better than many, but I need some advice.

$2000 a month is about the price to lease 2 luxury cars, payments on some furniture, and a couple of vacations a year. So you have the money to LOOK like you are doing well. But you are smarter than that. Keep doing this, and when you get to 40, you can walk into a dealer, and pay cash for a luxury car, then drive home to a house that you have equity in.

Pay off ur student loan asap - you'll have $350/mo more in ur pocket. Stop dining out, no gym, - $375/mo, also pets if possible gone- $50/mo to payoff loan. No more loan + misc expenses = $775/mo or $9300/yr. Thats a good chunk of cash toward saving for a home or emergecy fund. Key is to live beneath your means, not keep up w/ jones. Bad path to live your life by comparing yourself to others, where will it end?

Human: DON'T HAVE KIDS! LOL! Ok, now that that's out of the way...what are the best ways to save money on childcare? Our first is due this summer, and I will be able to work at home for 100% pay for 4 months, and then we are going to have to put the baby in day care. In theory, my husband and I could each negotiate more time working from home, but we both feel this would be very bad for our careers (it's allowed but frowned upon). Our household income is about $130k and this is still a stretch for us...I literally don't understand how it's possible to have kids on a lower salary. Full-time daycare is so expensive that between that, gas, and parking, I will be just about breaking even. I guess our options are: 1. Just eat the cost and live like poor people until kiddo is old enough for school 2. Negotiate for time working from home at the cost of promotions/bonuses/career advancement 3. Find better jobs that pay more money 4. Find jobs that let one or both of us work from home Any advice?

Working from home while caring for a kid only really works until they are about 7 months old, then they start needing your attention instead of just sleeping and eating. Obviously do a dependent care FSA but that only gets you $5k of tax advantages day care spending. Start keeping a monthly budget. Stop eating out as much. Make sure day care is convenient for both of you doing drop off and pickup. That is a big lifestyle thing. Consider working less anyway, if you can. Kids are great!

>Our household income is about $130k and this is still a stretch for us Shouldn't be. What are your monthly expenses?

Human: Let's hear the creative ideas you guys use to generate income aside from your 40 hr/week job.

Spend less / get a part-time job. Do babysitting / respite care. If you live near a college campus go dumpster (no real need to usually get into the dumpster) on move-out dates and load up all the furniture/fridges/etc. and sell it off.

I'd love to piggyback off of this and see what suggestions other redditors have for someone who does ~45 hrs/week in IT - another part time job is out of the question, I am on call 24/7 and if I'm unable to pick up the phone, it's big trouble. Similarily, I would have to imagine that picking up my phone while working at a part time job and then having to leave to take care of any issues that are coming up would get me canned from that part time job... I'd love to work a second job, but when I'm always on call, it's not feasible.

Human: Off the bat, I'm engaged to a wonderful woman, so I'm not interested in 'run and hide' as advice. We both graduated from undergrad in May 2012. She's in a master's program right now, graduating December 2014, and we're planning to get married just before that in October (2014). I'm entering a Master's program this fall, while working full time, and I have no student debt and won't be incurring any (expenses may increase some, but not much). Here are some stats: * My income: $60,000-72,000/year (strongly bonus dependent, unfortunately) * Salaried monthly take-home: $2600 * Take-home bonus, yearly: $6,000-10,000 (very variable) * Her projected yearly income: $75,000-95,000 * Current Savings: $18,000 * Putting in minimum 401k for company match: 6% (matched 35%) * Monthly Expenses: $1,800-2,000 * Her Student Loan Debt @ Graduation: * $110,000 (4%-7.9%) * $53,000 to parents (1%) * Wedding Expenses Budgeted: $5,000 By my calculations, we could have all the student loans paid off in about 3-4 years if she puts 3/4 of her take-home pay into her loans and I continue to pay for living expenses with my income, but it's still just disheartening to put off a family/house/travel/moving for so long. Does PF have any advice? It's just so disheartening for both of us. I knew what I was getting into, but she didn't seem to realize that she couldn't just pay it off on her own so I'm trying to work out a plan to help ease her into the idea that we're in this together. Thank you, everyone!

It's not the debt, it's the earning potential over the next 40 years that matters. Given your bride to be is headed for a well paying career, I'd be anything but disheartened. In fact I wouldn't be surprised if she makes a post here soon saying she's concerned about marrying a man with a variable income that's lower than hers will be ;) . Pay off the high interest rate debt first. Sure, you might have to put off having kids for a couple of years, but what's the hurry?

Judging by her taste in fancy schooling, I'm assuming the wedding is going to cost more than 5k. Try to find hobbies and travel destinations that are not expensive. You can still have a life while paying off this debt if you try hard enough.

Human: My primary VISA used to be a Wells Fargo credit card, but about six months ago I switched to Chase Sapphire and haven't used my WF since. It is by far my oldest credit card so I have an interest in keeping it active for the next 5-10 years. Ideally, I could charge $0.01 to the card once a year, a charge small enough to keep the card active, while not taking away bonus earnings from my other VISA. It wouldn't make sense to charge $25 to the WF card because that is $25 I'm not earning points on my Chase Sapphire. Does anyone have any ideas on how to charge $1 or less to my WF card, automatically and online, on a very infrequent basis? Edit: I do not have any other active bank accounts with WF. I closed them all out. It's just the credit card.

Just buy a coffee with it every quarter or so. Don't over complicate this.

> Does anyone have any ideas on how to charge $1 or less to my WF card, automatically and online, on a very infrequent basis? The closest I can think of is register it with itunes and buy a $0.99 cent song or app every few months. But honestly, how many points are you losing and what are they worth if you make a $25.00 purchase once a year? Is it really worth all this hassle?

Human: Ive got my eye on a used VW GTI for 22k. I have 3k in the bank right now but hoping to use that for down payment on new place rent and start up living expenses. My current car could break down any moment and Id like to get my new car in the summer and while I am still living in my hometown for another few months to drive it around here before I move. I can get family to loan me another 1k if needed but just wondering if I can delay my payments? Ive always driven beaters ive paid cash for so ive never had to worry about payment plans.

No. Wait until you have a job.

I don't think you will get approved for a loan until after you start the job unless you have a cosigner. They generally want you to have an acceptable level of income for at least three months before the start of the loan.

Human: I've had a few customers for my small business recently ask if they can pay using direct deposit into my business bank account. But doing this requires disclosing my bank's routing number and my account number, which is the same information that (for instance) utilities require when setting up automatic payment of bills. How easy would it be for someone to fraudulently use this information to withdraw money from my account electronically? What protections do banks put in place to prevent this? Are there more secure, inexpensive alternatives for electronic fund transfers?

I won't bore you to death but the system you speak if is called [ACH \(Automate Clearing House\)](http://en.wikipedia.org/wiki/Automated_Clearing_House) transactions. ACH is used for direct deposit and automated withdrawals (like setting up automatic check payments with the utility company). The system mimics the same check writing system we have had for over 100 years. The account number and routing number are used to create debit or credit transactions that are settled by the bank holding the account. If someone gets your routing number and account number they could *technically* withdraw money from your account. As can anyone you write a check to... Check forgery isn't new... The biggest deterrent for this though is that the ACH transactions, much like checks, have to have a bank account they are being settled to. Actually, they are worse than checks as you can't throw a middle man into the equation (with a physical check you could use a check cashing place or other intermediary to make it harder to trace back). Having an account at the other end of the wire that has to be stable makes it easier for the banks to build in fraud detection systems and to recovery money when fraud is reported. Essentially, it isn't a *major* problem because it is a lot more effort than something like credit card fraud .

Think of it this way: what information do you need when withdrawing your own money? You generally need to: * go to the bank in person and show identification * have a debit card with a pin to go to an ATM or * have the slew of information to log in via the internet (varies by bank) And as other people have mentioned, if you have ever written a check, you are giving out the same information. You should always double check your accounts and watch out for fraud no matter what the circumstances.

Human: After a B.S. and M.S. I am heading into a PhD program where I will receive a stipend of about ~27k/yr, which I think I have to pay taxes on so I don't anticipate having a lot of extra money at the end of each month. Most of my loans are federal however my first year of college I had to take a private loan as I was still young enough for my parents income to make me not eligible for federal loans/grants. I think I should consolidate my debt but have no clue if this is a good idea or how to do so. Any help or suggestions would be greatly appreciated.

You'll most likely be able to [defer](http://studentaid.ed.gov/repay-loans/deferment-forbearance#am-i-eligible-for-a-loan-deferment) your federal student loans while you're in the PhD program. I'm finishing up a PhD program now, and my loans have been in deferment for the whole time. It's nice. If you consolidate them, I don't think you can still defer them.

85k is a lot of debt, and you really need to keep up on the interest while in graduate school. Do whatever you can to keep the interest paid, so the total doesn't creep up. You should be able to tutor undergrads or even high school students 5-10 hours per month, which is enough to keep up with that interest. It is also great for getting teaching experience, in case you decide to go the academic route.

Human: I am still in High school and relatively new to personal finance and acquiring general success, but I would like to know more. I'm sorry if this is a frequent question, but what are some beneficial things you wish you had known or done earlier in life? Even if it doesn't save money directly or help me to get a better career, I'd love to hear it. p.s. I am familiar with the straight forward things like "build credit" "stay debt free" and "study hard".

Last weeks winning lottery numbers. On a serious note, IRAs.

Never trust a person that says "You can trust me, Fluffylady". Run to the hills if anyone says that to you.

Human: Hi PF. I am staring down the last 14k (currently @ 2.75% APY) of my student loans and I can contribute about 1k a month to pay them off. I know that the interest counts directly against my income to determine my AGI. Once I have finished paying this off, which could be within the year due to about 5k I will be given from my mom sometime this year), I won't have any remaining deductions to my income. I'll be in the 50k tax bracket this year (25% marginal rate right?). I know really I'll only be paying like <$400 in interest depending on how fast I pay it off. I'm accruing like $32/mo in interest on the current principal. Does it make sense to slow down and deduct the interest for tax purposes? Thanks for looking

>Does it make sense to slow down and deduct the interest for tax purposes? Not unless you're going to do something more productive with the money. The benefit is a tax *deduction*, not a tax credit. This means whatever you save in taxes is always less than what you pay in interest. In simple terms, it never makes sense to send the bank $1.00 so you don't have to send the IRS a $0.25. Each dollar of interest you pay is still a net $0.75 loss.

I agree with threeLetterMeyhem. Taxes should be a factor, but not the deciding factor. You should figure out what you could do with the money if you didn't repay your student loan. Build up your emergency fund, fund an IRA, pay off credit card debt, etc. There's obviously lots to do with money. Yes, $50K of *taxable* income (after deductions and exemption) is the 25% bracket for 2013.

Human: I really like Mint's budget tracking abilities, but the thing is, I really would like the ability to align a month's budget with my pay cheques. The way it is now, by calendar month, my "months" of money eat into each other, if that makes sense. I have emailed Mint and it doesn't sound like they have plans to implement this. Is there anything better, aside from keeping an excel spreadsheet? I don't know if I'd be motivated to constantly update an excel spreadsheet, to be honest. I'm also not the best with math so I don't trust myself. I'm in Canada so anything suggested needs to work with Canadian accounts, if applicable. Assistant: Not sure if it will do what you're looking for (i don't use it), but http://www.youneedabudget.com/ is another popular one. Human: Is the functionality similar to mint in that it feeds from your bank accounts? I can't really see what it "does" without downloading the program, which I'll do at home tonight. There seems to be Canadians on the forums. I assume if I switch I'll lose my historical info from Mint (or, it won't carry over in any way). I seriously kind of hate Mint but assumed there wasn't another option out there.

You can use YNAB for free for 30 days. I highly suggest doing that and spending the time to go through all the training videos. It's an amazing product and well worth it!

No, it doesn't automatically sync bank data. If you want set it and forget it budgeting, it's not for you. The philosophy and lessons of ynab are good, but I find free spreadsheets combined with mint work fine for long term budgeting.

Human: Thats it, I am 25 years old with €50k+ in savings and I wanted to you your opinion about how to invest in Spain/Europe/World being from Spain. Thanks!

Maybe try /r/investing ?

The Greek Stock Market.

Human: Apparently, there was some minor fee that I was never informed about that was sent to collections without me ever receiving notice. I found out when the collections agency called me. I told them that I had not been notified, and apparently they have my old address and had been sending the notices there. I gave them the correct address, and they sent me a notice in the mail. So now I have the notice. They've tacked on about $4 due to 12% interest. I called them up following [this guide](http://www.creditinfocenter.com/debt/pay-for-delete.shtml) to offer to pay for this collection if they will sign a document agreeing not to report it to the credit bureaus. The person on the phone responded that they don't sign such documents historically, and won't be able to sign anything, but don't worry, because collections under $50 aren't reported to the credit bureaus. Can anyone confirm if this is true?

Your agreement is only as good as the paper it's written on.

They can report whatever they want to the bureaus, there really isn't any rule about sub $50 things. I would just inform them that you don't make deals without a signed agreement historically, and won't be able to give them any money.

Human: I found out today that I'll be let go this Friday because my department within my company is getting cut. I'm panicking because I don't know how long it's going to take for me to get a new job, and I don't know what to do next. I'm wondering what I can do to stay afloat until I get another paycheck while not screwing myself over for years to come. Here are some details: 1. I'm mid-twenties, single, living in the DC area, and have been working in software development since college (as an analyst, not a programmer.) 2. I bought a condo back in February, and (pretty dumb) wiped out my savings and took a $25K loan to pay for it. My personal savings are very low from buying the condo (barely $1K), and I have about $23K left on the loan. EDIT: The cost of condo association fees, utilities, and the loan together are about $1400/month. 3. My 401(k) has about $21K in it. 4. I have $4K left of credit card debt at 9%. The card has a $25K max. 5. I have a couple of student loans totalling $7K, at rates ranging from 1.8% to 6.8%. 6. My car is paid off and worth about $10K. I'll be hitting the classifieds pretty heavily over the next couple of days, but what should I do if I don't get anything for a month? Two months? Six months? My co-workers and I have been talking about it, and here are some of the ideas they've had. 1. Cash out the 401(k) and use it to cover the next few loan payments. 2. Cover everything on credit card until the next job comes, and then make paying the credit card the top priority. 3. Sell the car. 4. Sell the condo. (I really, really don't want to do this, because I love the location, and it would take me a couple months to get it sold - thanks, condo association rules!) 5. Enlist in the military. 6. All of the above. I appreciate any assistance you can give! *EDITS:* Formatting errors. Assistant: Thank you, everyone, for all of your advice! (I don't know if it's bad Reddiquette to have one catch-all thank you post opposed to individual ones - if so, my apologies.) For my original post, I was definitely panicking and focusing on the worst-case scenarios. Since then, I've had a chance to calm down, read your advice, and come up with a plan. 1. Because of my companies pay cycle, I'll be getting a paycheck this Friday, plus another regular paycheck in two weeks, so I have at least a month's full pay to cover basics. 2. HR said I will get a severance package - they'll put it together and present it to me at my exit briefing on Friday. The HR rep said I should expect between 1-2 months worth of salary, so that will help, too. 3. I do qualify for unemployment, so doing the paperwork will be tonight's activity. 4. It looks like I do qualify for student loan reduction, so I'll be contacting the provider tomorrow. 5. Goodbye, fancy internet, unlimited data plan, and double IPAs! Hello, library, cheap cell phone, and tap water! 6. Two friends have already agreed to pass along my resume to the HR department, and another one (lives in my complex) has offered to let me use his internet, so thank God for good friends! Thanks again for all the advice!

Good! I would seriously look into a roommate as well, even just a temp one. It can help your living expenses immensely. Good luck.

sounds like you have your ducks in a row. a person with foresight like you will always keep their head above water...

Human: Spring is here, and with it a bunch of new graduates entering the real world for the first time. And let's be honest, even those of us not graduating or already graduated could dust off our budgets and revisit them every once and awhile. In honor of these two things, I thought it would be great to have a thread with lots of examples of budgets from all over the financial spectrum - rich, poor, slogging through student debt, saving for early retirement, etc. If this proves useful, I will take all the budgets and format them in a way that they can be put in the sidebar as examples for people to look at when they have questions. So come all ye with budgets! Please include the following with your submission: -age -living/family situation -annual salary/life place -financial goals (either short or long term) This thread is meant to be something everyone can learn from, not a massive judgement on other people's spending habits. Please keep questions/critiques friendly, and remember these posts are not people asking for advice on their budget, they are simply sharing their strategy. **tl;dr share your budget so others can learn from all of our collective budgets!** Edit: thanks for all the awesome responses guys! Would love to see some more budgets with different situations (families, debt, lower income, etc.) but please keep sharing!

* Age: 24 * Living Situation: Splitting a 2bdrm row house * Location: Philadelphia * Annual Salary: 47,760 gross * Monthly Income: ~$2788 | Item | Amount | |:----------- |------------:| | Rent | 600 | | Utilities | 100 | | Cell Phone | 50 | | Student Loan Min. | 1,380 | | Groceries | 150 | | Going Out | 150 | | Savings | ~350 | My financial goals include building a 5K emergency fund (around 2.5K right now) and paying off my student loan debt (~123K.)

Sorry, I don't attend the first annual anything - it's a matter of principle.

Human: I see a lot of posts telling people in their 40's (and even higher) to start a Roth IRA/401k. We need to realize that a Roth is simply a tool for tax diversification over a lifetime. I would say people in their 40's-50's are in their peak earning years and therefore paying their highest marginal tax rate. A Roth is only a good idea if the person is expecting to withdraw more more per year from savings in retirement than they are presently earning. For someone in their 20's, this is likely a no-brainer, but for people in their peak earning years, they will likely have to withdraw less per year from savings than they're currently earning. Why pay taxes on that savings now when they will pay the highest price? Of course, another argument would be that if we expect marginal tax rates to go up in the future, it would make sense to pay that tax bill now. However, the more someone is currently making, especially if they are in middle age, the weaker the argument is for a Roth.

[FAQ: Roth or Traditional?](http://www.reddit.com/r/personalfinance/wiki/faq#wiki_roth_or_traditional.3F) Especially [r/PF's definitive post on the topic](http://www.reddit.com/r/personalfinance/comments/18zgci/us_lets_talk_retirement_taxes_fees_and_penalties/)

Another thing that is pretty nice is that a Roth is funded with post tax dollars, but it has the same $5,500 limit for 2013. If you are planning on maxing out your IRA and your 401k a Roth IRA or Roth 401k actually allows you to put away more money. For example, if someone is in the 15% federal income tax bracket they will be paying *roughly* 30% in taxes. So that $5,500 pretax contribution would actually end up being $3850 post tax (holding the tax rate constant). Conversely, the Roth is funded post tax, so if you contribute the $5,500 and max it out you are effectively contributing $7,150 pre tax dollars. Assuming your income tax rates at least stay the same, you will end up with more money in retirement by maxing out a Roth than a traditional IRA or 401k.

Human: A great listen for you redditors out there who dream to become financially independent. http://www.youtube.com/watch?v=1yk7x8TuUB0

http://www.listentoyoutube.com/ will let you enter a youtube url and download the audio as an mp3...just sayin'

Thank you.

Human: I'm 20, currently going to be studying abroad twice. I go to a rather expensive private school, but scholarships, grants, and my generous mother take off most of the load. In my first year, I took out $5,500 in federal loans and in my second year I took out $6,000. A little less than half is subsidized, a little over half is unsubsidized. I haven't gotten the new financial aid package yet, but I was told that since I won't be able to do work study, I'll probably be granted an extra $2,000 in loans (not sure if subsidized or unsubsidized). Doing the math, it look like I'll have about $26,000 in student loans when I graduate. My major is modern languages (French and Japanese, with a smidge of Chinese). I don't know what I plan on doing as a career. The next two semesters, I'll be studying abroad in Martinique and Senegal, but I'd like to go to Japan as well because my Japanese is at a much lower level, and I'm afraid if that I won't continue if I'm not so good when I finish school. I've discussed it with my mom, and she's against it because of the additional costs that go along with study abroad (plane tickets, insurance, miscellaneous expenditures that come from not being close to home, etc). I'm potentially willing to take out a few thousand dollars ($3-4k) in private loans, but I realize it's not the smartest decision financially speaking. In addition to the added costs of the trip, it would also mean I'd definitely stay in school for the full eight semesters. I actually have senior standing and could graduate a semester early if I didn't go to Japan (probably a year early if I cut out Senegal). But... I don't really want to leave school. I'm not sure I would graduate early even if I didn't go because I really love my school (even if the amount of time I want to spend abroad makes it look like the opposite!), and I'd like to graduate with my friends. But admittedly, it would save me $7,000 in loans and ~~$10,000~~ $5,000 of my mom's money. So, /r/personalfinance, do you think the experience is worth the additional costs? Or should I put Japan on hold? Edit: Oh, and I guess I should add that I have no other debts. I also don't have a car, though, so that's probably a purchase I'll need to make when I graduate. I do have a credit card that I've been using very regularly for two years and never had a late payment on, so (so far at least!) I've been pretty good at controlling my spending. I have about $1000 right now, and will be doing a paid internship from mid-June to the end of August.

It seems you are bunching up too many choices. From your post it seems like you have a couple of options: + Study abroad twice and stay in school for 4 years. + Study abroad once and stay in school for 4 years. + Study abroad once and graduate in 3.5 years. + Not study abroad and graduate in 3 years. These options seem conflicted by the desire to: 1) stay in school as long as possible, 2) study abroad, 3) reduce expenses, and 4) gain "valuable" experience. I will focus on 4, especially with regards to Japanese: Japanese has little use outside of Japan or with dealing with Japanese companies (even then its very limited to mostly native speakers). It is rare to meet someone in Japan that is hired for their native English+intermediate Japanese (you likely wont reach this level even with a study abroad). With one exception: Teaching English. After 1 or 2 years in Japan you could get a job as a recruiter or something similar. Otherwise Japanese is pretty much useless without an additional non-language skill. From a finance perspective and personal life perspective: graduate early and teach English abroad if you are interested in spending some time outside of the US. One study abroad trip is great for personable development, but only until 1+ year abroad do you truly become comfortable in the other country. Its not so clear from your post exactly how much an additional semester costs in total (your contribution plus your mom's), but I am guessing ~$10k which is a huge amount of money.

Think about how much developing your Japanese is worth to you. If you want to work with the language than perhaps it is a much better option to study there, rather than saving some money.

Human: I just lost my job on Friday. We're okay though, thanks to Dave Ramsey and this sub. My family and I have about 8 months of emergency funds saved up. Now the question is: Do we continue living on as if nothing happened while I search for a new job and hopefully finding one before the money runs out? My first instinct is to stretch the money out and stop overpaying all of our debt down and just make minimum payments. Also, stop contributing to the Roth IRA or any other savings. The 401k automatically gets stopped obviously. I guess as I type it out, the obvious answer to me looks like stretch the money out as much as I can "just in case". For what it's worth though, I don't imagine being out of the job too long because my field has a lot of demand where I am.

I'd definitely stretch it out. I mean, if you have extras after finding a new job and replenishing your 401k, you can always contribute to Roth IRA and savings extra, making up for the missing months. Similar with paying down debt. Congrats on having a cushion!

Sorry to hear you lost your job, but I'm also glad that you've prepared. Remember you have essentially 23 months to max out your IRA for 2013 (you can contribute the full amount until April 15, 2014 for tax year 2013), so that should not be a big rush. I would also dial down your debt payments, but if you have already budgeted 8 months for your emergency fund including your debt I would not take it down to the minimum.

Human: I ran into a situation this year where my medical deductible of $750 has been met. I am a healthy 25 year old male. On average I visit my GP once a year, never a specialist. I feel like I should "take advantage" of this situation and make the most of it. Are there any specialty doctors I should visit? Have any specific tests done? Should I look into anything else? I have considered a sleep study and also being checked/treated for CTS. I am not sure how I would go about seeing what would be covered under my insurance plan so any advice would be great.

Check the fine-print on your plan. Just because you met your deductible does not mean everything is "free" now. Most non-basic things will be 50-80% covered, but rarely 100%. It's really up to you how much you want to spend.

Mynameisphilip is correct, now you may only have to pay 10%-30% and your insurance picks up the rest. What is your "annual max out of pocket" amount? That's usually an amount about double or more of your deductible, but hitting that number is going to help you save more money should you need expensive treatment.

Human: I just did the math and company pays $468 for me (single, healthy 24 year-old). I make $30k a year. If you opt out of a employer plan, is there any consequent bump in salary? I know this is dependent on the employer, but is that typical?!

In my anecdotal experience, it's uncommon to receive compensation for not taking advantage of health insurance.

I opt out of my employer's health plan and I get additional salary instead. I think this is relatively common. At the very least, even if it isn't company policy, it's something you can try to negotiate for.