Non-investing personal finance issues including insurance, credit, real estate, taxes, employment and legal issues such as trusts and wills
Just wanted to share a success story from my family. My wife and I paid off her student loan debt, to the tune of roughly 35k just last week. I got tired of paying the interest, while I had an excess cash problem in our accounts (as I viewed it). I have been doing a bit of obsessive research on finances in the past few years, trying to maximize my successes in life.
A little background if interested:
He: 26, near 27
Built a house in Summer 2010, Married almost 2 years
We currently put in about 10% to our company defined plans (401k and 403). Mine will start matching 3% this year. We both carry pensions at our current employers. I am not sure how long we will both be employed with current employers -- I will definitely jump ship again [Software Industry]. I also max both of our Roth IRAs each year. Oh, and in addition I put 3k in a kids college fund and intend to do so for the next 20 years.
At the end of 2012 a finance snapshot put us somewhere like this:
His IRA: ~33k
His 401: ~ 5k
Her 403: ~2k
His Roth: ~15k
Her Roth: ~5k
College Fund: ~6k
~35k student loan (hers)
~6.5k car loan
~200k at 3.25 mortgage
So, I opted to take our high cash volume and pay off the student loans. I now opted to take that payment and apply it towards our mortgage principal, paying roughly 1.5x the amount applying over-payment to principal. This should make my 30 yr an 18 year or so mortg. Proud of us, we both were a little worried. But I feel we need to be even more aggressive with our savings to reach my most prized goal in life (aside from a family) -- to retire at about 52-55, as my parents did.
Just thought I would share a success story. Feel free to chime in on any suggestions seen.
- Posts: 4
- Joined: 6 Jun 2012
No comments or suggestions, but congratulations!
- Posts: 165
- Joined: 19 Apr 2012
Congratulations. Hopefully you and your wife find happiness in the flexibility that having less debt provides.
Your post is inspirational as we work down our own student loan debt.
- Posts: 49
- Joined: 22 Nov 2010
Congratulations on paying off the student loan debt. With two jobs and ample cash reserves, why keep the car loan? There is not a lot to go on here regarding you general request for advice. You would get a lot of helpful suggestions on building your portfolio and financial plan by posting the following informatoin in a new thread on the "help with personal investments" section of the forum. viewtopic.php?f=1&t=6212
- Posts: 275
- Joined: 8 Mar 2009
Congrats on paying off your student loan.
I just paid off my student loan @44k, 5.5% interest. And it feels great. I also refianced the house at 30 year, 3.25%, and pay additional per month to be done in 15 years.
The only remaining debt is car loan at 2.99% and mortage.
If you struggling what to do with extra cash you can always max out the 401k to $17.5k a year like I am. Better than stock picking.
- Posts: 240
- Joined: 5 Nov 2011
Thanks for the encouragement. Yes, I will post in the other forums subsection when I need portfolio advice. Still not quite there yet.
goodoboy, thats great. Congrats as well. Nice on the extra mortgage payments, I also plan to most likely finish it in about 15 years with more contributions later.
And the car loan is like 2%, so no rush yet. And yes I plan to increase 401k soon.
- Posts: 4
- Joined: 6 Jun 2012
Return to Personal Finance (Not Investing)
Who is online
Users browsing this forum: CABob, calewis16, killjoy2012, letsgobobby, mhc, Minot, stacytina and 47 guests