Search found 56 matches

by AC1984
Wed Sep 16, 2020 8:00 am
Forum: Personal Investments
Topic: Purchasing home with less than 20% downpayment experiences?
Replies: 59
Views: 4906

Re: Purchasing home with less than 20% downpayment experiences?

I just put 5% down on our first house. 2.875% for 30 year without paying anything extra for points. PMI is $60/ month. DW and I are both public employees so the risk of either of us losing our job and needing to sell is minimal. Besides the PMI, there didn't seem to be any difference if we had put ...
by AC1984
Wed Sep 16, 2020 7:59 am
Forum: Personal Investments
Topic: Purchasing home with less than 20% downpayment experiences?
Replies: 59
Views: 4906

Re: Purchasing home with less than 20% downpayment experiences?

Just do it. Now. We bought our first house with 5% down and had to pay PMI... (then getting an appraisal to get rid of the PMI after year 3) Then we bought our current house with 10% down and 10% HELOC (which we are finally paying off after 2 1/2 years) I know conventional wisdom says to wait until...
by AC1984
Tue Sep 15, 2020 1:56 pm
Forum: Personal Investments
Topic: Best way to build an emergency fund?
Replies: 95
Views: 6501

Re: Best way to build an emergency fund?

I believe the OP is now saying instead of directing Roth IRA to 100% equities, he will use money market funds. Yes, he wants and "emergency fund", something in cash like form (some bonds may be acceptable), and the most expedient solution is to liquidate in tax advantaged space so there isn't a cap...
by AC1984
Tue Sep 15, 2020 1:42 pm
Forum: Personal Investments
Topic: Best way to build an emergency fund?
Replies: 95
Views: 6501

Re: Best way to build an emergency fund?

I thought OP was already maxing out Roth and 100% equities. Did something change or is there something else I'm missing? Additional tax advantaged space that's not used? For the past two years we've been maxing out two 401k's, a 457 (I'm a state employee and have access to both) and two back door R...
by AC1984
Tue Sep 15, 2020 1:40 pm
Forum: Personal Investments
Topic: Best way to build an emergency fund?
Replies: 95
Views: 6501

Re: Best way to build an emergency fund?

Most of the rest of us managed to pay back our student loans. :mrgreen: Plus, I made sure my children graduated from college and graduate school debt free. All on a household income less than yours. :beer What degree or degrees did you get to amass a whopping $350K student loan? Please tell me it w...
by AC1984
Tue Sep 15, 2020 7:25 am
Forum: Personal Investments
Topic: Best way to build an emergency fund?
Replies: 95
Views: 6501

Re: Best way to build an emergency fund?

I would limit funding your 401k up to a match and use that to fund your EF for 6 months of expenses and then resume full match. I think you guys are doing an awesome job of saving! Thanks :) I tried to use all the overtime money I could toward retirement accounts the past few years. I know saving c...
by AC1984
Tue Sep 15, 2020 5:44 am
Forum: Personal Investments
Topic: Best way to build an emergency fund?
Replies: 95
Views: 6501

Re: Best way to build an emergency fund?

I know this has been mentioned so I want to be clear on one part. Does the wash sale rule apply to selling in one account (taxable) and buying in another (Roth IRA)? If so that's easy to avoid I guess by waiting a month. If I had a taxable loss I’d sell and immediately buy a similar but not identic...
by AC1984
Sun Sep 13, 2020 8:00 am
Forum: Personal Investments
Topic: Best way to build an emergency fund?
Replies: 95
Views: 6501

Re: Best way to build an emergency fund?

I'm understanding the situation better, and think the emergency fund is a red herring. OP was cruising along with a solid plan making progress on retirement and paying off debt and over $1000 extra cash a month and hit a speed bump, so no extra cash. He's now realizing, OMG, I don't have an EF. and...
by AC1984
Sat Sep 12, 2020 6:58 pm
Forum: Personal Investments
Topic: Best way to build an emergency fund?
Replies: 95
Views: 6501

Re: Best way to build an emergency fund?

Most of the rest of us managed to pay back our student loans. :mrgreen: Plus, I made sure my children graduated from college and graduate school debt free. All on a household income less than yours. :beer What degree or degrees did you get to amass a whopping $350K student loan? Please tell me it w...
by AC1984
Sat Sep 12, 2020 5:11 pm
Forum: Personal Investments
Topic: Best way to build an emergency fund?
Replies: 95
Views: 6501

Re: Best way to build an emergency fund?

My thought would be sell equities to pay off the loans, and use the subsequent cash flow equivalent toward an emergency fund. LOL. Rob Peter to pay Paul. What happened to those valuable equities you sold? If you take the straight path..." My thought would be sell equities to pay off the loans, and ...
by AC1984
Sat Sep 12, 2020 3:21 pm
Forum: Personal Investments
Topic: Best way to build an emergency fund?
Replies: 95
Views: 6501

Re: Best way to build an emergency fund?

Pause taxable investing:......................................................................................$1000/month ... Looking at it from this perspective makes it seem like a no brainer to pay all this off, even with the potential loss of future gains of the $15k withdrawn from the taxable ...
by AC1984
Sat Sep 12, 2020 1:49 pm
Forum: Personal Investments
Topic: Best way to build an emergency fund?
Replies: 95
Views: 6501

Re: Best way to build an emergency fund?

I would definitely sell the taxable investments and pay off the loan. Of course, I would turn on the Specific-Id tracking on the taxable investments and pick those lots to sell, that have the least gains or perhaps even losses to cover the amount. The "higher rates of return" in the market are not ...
by AC1984
Sat Sep 12, 2020 11:54 am
Forum: Personal Investments
Topic: Best way to build an emergency fund?
Replies: 95
Views: 6501

Re: Best way to build an emergency fund?

Wow, so I tallied the current balance for both car loans and my wife's student loans and pausing the taxable contributions. Each loan has it's own payoff date and the numbers are rounded for simplicity. My car: $161 biweekly ($350/month divided by 12)..................Total balance = $3,200 Wife's c...
by AC1984
Sat Sep 12, 2020 10:07 am
Forum: Personal Investments
Topic: Best way to build an emergency fund?
Replies: 95
Views: 6501

Re: Best way to build an emergency fund?

Regarding PSLF, I'm 99.9% positive it will go through. All the best. There is a lot of financial water to flow under the bridge between now and 2025 due to the Covid crisis and the strain on the country's finances. At the very least, saving at your high rate will have built up your portfolio over t...
by AC1984
Sat Sep 12, 2020 9:52 am
Forum: Personal Investments
Topic: Best way to build an emergency fund?
Replies: 95
Views: 6501

Re: Best way to build an emergency fund?

CyclingDuo - Can you help me better understand your thoughts about which accounts to stop contributing to in the interim? There's $58,500 possible to max out the two 401k's and the 457, and $12,000 between our Roth IRA's. My 401k match is maxed when I put in 5%. The State automatically adds 4% no m...
by AC1984
Sat Sep 12, 2020 8:33 am
Forum: Personal Investments
Topic: Best way to build an emergency fund?
Replies: 95
Views: 6501

Re: Best way to build an emergency fund?

My wife's loans total $5,900 and we're paying $220/month (variable interest rate, currently less than 3%), and they're also on track to be paid off in 2025. You really want to wait 5 years for paying off this small $5900 amount? Why not pay it off now? Because at least the way I see it, I don't hav...
by AC1984
Sat Sep 12, 2020 8:20 am
Forum: Personal Investments
Topic: Best way to build an emergency fund?
Replies: 95
Views: 6501

Re: Best way to build an emergency fund?

My wife's loans total $5,900 and we're paying $220/month (variable interest rate, currently less than 3%), and they're also on track to be paid off in 2025. You really want to wait 5 years for paying off this small $5900 amount? Why not pay it off now? Because at least the way I see it, I don't hav...
by AC1984
Fri Sep 11, 2020 9:19 pm
Forum: Personal Investments
Topic: Best way to build an emergency fund?
Replies: 95
Views: 6501

Re: Best way to build an emergency fund?

I think the exception here being we are not talking about just maxing out both spouse's 401k and Roth IRA's. They are maxing out an additional plan by doing two 401k's and one 457b (for a total of 3 pre-tax retirement plans), plus the two Roth IRA's, and contributing into an account for the niece/n...
by AC1984
Thu Sep 10, 2020 12:50 pm
Forum: Personal Investments
Topic: Best way to build an emergency fund?
Replies: 95
Views: 6501

Re: Best way to build an emergency fund?

Sticking to a budget is the one obvious part we haven't done. I don't know why it's so hard to start, but definitely worth exploring. Download one of the free budget apps - and enter everything religiously for a few months to get the true picture of what comes in and what goes out. It's well worth ...
by AC1984
Thu Sep 10, 2020 8:54 am
Forum: Personal Investments
Topic: Best way to build an emergency fund?
Replies: 95
Views: 6501

Re: Best way to build an emergency fund?

Our current loans consist of two car's (one's almost paid off, the other in two years, both less than 3% interest so just paying the minimum) . That will free up $400/month when paid off. Mortgage is $550 biweekly for another 15 yrs, but we are paying at this point $200 principal every two weeks. M...
by AC1984
Thu Sep 10, 2020 8:44 am
Forum: Personal Investments
Topic: Best way to build an emergency fund?
Replies: 95
Views: 6501

Re: Best way to build an emergency fund?

I'm amazed to have accumulated so much in the investments at this point in time, but feel like I got carried away and haven't kept up the cash reserves. We are pretty similar actually. I Dave Ramsey-ed away my debt in 2011, then went all in on all my various tax advantaged retirement options and go...
by AC1984
Thu Sep 10, 2020 8:30 am
Forum: Personal Investments
Topic: Best way to build an emergency fund?
Replies: 95
Views: 6501

Re: Best way to build an emergency fund?

I think you're confusing emergency funds with emergency plan. And you're commingling some of your bigger cash expenses. Are you helping your nieces and nephews pay tuition or completely spoiling them? Or do you just have a whole lot of them? I agree with those that say keep maxing out ALL the tax a...
by AC1984
Wed Sep 09, 2020 12:54 pm
Forum: Personal Investments
Topic: Best way to build an emergency fund?
Replies: 95
Views: 6501

Re: Best way to build an emergency fund?

I'm reading different answers in different places regarding whether one can withdraw contributions to a nondeductible traditional IRA tax/penalty free. In my case it would likely not be in the same year as it was contributed if used as a backup emergency fund. I called Vanguard and the person said I...
by AC1984
Wed Sep 09, 2020 7:28 am
Forum: Personal Investments
Topic: Best way to build an emergency fund?
Replies: 95
Views: 6501

Re: Best way to build an emergency fund?

Does the fact that my Roth contributions are back door change the soundness of this plan? In other words, do they have to be in the MMA for 5 years for the funds to be EF accessible? https://www.bogleheads.org/wiki/Roth_IRA The amounts you withdraw from a Roth IRA are considered to consist of the f...
by AC1984
Tue Sep 08, 2020 8:58 pm
Forum: Personal Investments
Topic: Best way to build an emergency fund?
Replies: 95
Views: 6501

Re: Best way to build an emergency fund?

Does the fact that my Roth contributions are back door change the soundness of this plan? In other words, do they have to be in the MMA for 5 years for the funds to be EF accessible? https://www.bogleheads.org/wiki/Roth_IRA The amounts you withdraw from a Roth IRA are considered to consist of the f...
by AC1984
Tue Sep 08, 2020 8:25 pm
Forum: Personal Investments
Topic: Best way to build an emergency fund?
Replies: 95
Views: 6501

Re: Best way to build an emergency fund?

Rather than halting Roth IRA contributions I would just use it as part of your emergency fund (leave it in money market). If an emergency comes up, you withdraw it penalty free and lose the Roth space, oh well. If no emergency comes up you can eventually move it to your asset allocation once you ha...
by AC1984
Tue Sep 08, 2020 7:26 pm
Forum: Personal Investments
Topic: Best way to build an emergency fund?
Replies: 95
Views: 6501

Re: Best way to build an emergency fund?

Rather than halting Roth IRA contributions I would just use it as part of your emergency fund (leave it in money market). If an emergency comes up, you withdraw it penalty free and lose the Roth space, oh well. If no emergency comes up you can eventually move it to your asset allocation once you ha...
by AC1984
Tue Sep 08, 2020 6:35 pm
Forum: Personal Investments
Topic: Best way to build an emergency fund?
Replies: 95
Views: 6501

Re: Best way to build an emergency fund?

Rather than halting Roth IRA contributions I would just use it as part of your emergency fund (leave it in money market). If an emergency comes up, you withdraw it penalty free and lose the Roth space, oh well. If no emergency comes up you can eventually move it to your asset allocation once you ha...
by AC1984
Tue Sep 08, 2020 5:59 pm
Forum: Personal Investments
Topic: Best way to build an emergency fund?
Replies: 95
Views: 6501

Re: Best way to build an emergency fund?

Rather than halting Roth IRA contributions I would just use it as part of your emergency fund (leave it in money market). If an emergency comes up, you withdraw it penalty free and lose the Roth space, oh well. If no emergency comes up you can eventually move it to your asset allocation once you ha...
by AC1984
Tue Sep 08, 2020 5:57 pm
Forum: Personal Investments
Topic: Best way to build an emergency fund?
Replies: 95
Views: 6501

Re: Best way to build an emergency fund?

Jags4186 wrote: Tue Sep 08, 2020 4:52 pm Cut your $12,000/mo in expenses to $7,000/mo and you'll have $50k saved in no time.
I may have overstated the expenses, we're at around $8,000/month.
by AC1984
Tue Sep 08, 2020 5:53 pm
Forum: Personal Investments
Topic: Best way to build an emergency fund?
Replies: 95
Views: 6501

Re: Best way to build an emergency fund?

Don't buy a teardrop now. Demand is sky high which means prices are likely sky high, and manufacturing quality from the factories will be lower than the usual terribly low quality from the recreational vehicle industry. I have been in manufacturing over 30 years in an adjacent industry to recreatio...
by AC1984
Tue Sep 08, 2020 5:51 pm
Forum: Personal Investments
Topic: Best way to build an emergency fund?
Replies: 95
Views: 6501

Re: Best way to build an emergency fund?

For the past two years we've been maxing out two 401k's, a 457 (I'm a state employee and have access to both) and two back door Roth IRAs. Others have responded so nothing new to add other than Why are you doing a backdoor Roth when you are under the limit & can contribute directly? Because I had a...
by AC1984
Tue Sep 08, 2020 2:03 pm
Forum: Personal Investments
Topic: Best way to build an emergency fund?
Replies: 95
Views: 6501

Re: Best way to build an emergency fund?

It seems you are looking for support to decide to stop funding 401k and nieces/nephews account, right? You are pursuing PSLF, this means you have student loan debt, correct? To build an emergency fund, put money into the fund. If you are "maxed out" with other savings such as 401k or nieces/nephews...
by AC1984
Tue Sep 08, 2020 2:01 pm
Forum: Personal Investments
Topic: Best way to build an emergency fund?
Replies: 95
Views: 6501

Re: Best way to build an emergency fund?

I'm in Michigan, cost of living isn't too high. My expenses are roughly $8k monthly, though I'm sure we could trim it a bit. We have student loans, car notes, and some other fixed expenses (cars were before my current job, and my wife's loans are on a regular payment plan). To be sure, in a true eme...
by AC1984
Tue Sep 08, 2020 1:35 pm
Forum: Personal Investments
Topic: Best way to build an emergency fund?
Replies: 95
Views: 6501

Best way to build an emergency fund?

I'm wondering the best way to build a cash emergency fund given my situation. I'm a 36-year-old married homeowner with $90k yearly income. My job is considered essential with a stable income. My wife ($75k income) and I both work full time and we've invested heavily in retirement accounts over the l...
by AC1984
Tue Jul 23, 2019 5:13 pm
Forum: Personal Finance (Not Investing)
Topic: Paying Off Mortgage Question
Replies: 77
Views: 7484

Re: Paying Off Mortgage Question

We did this, and paid off the mortgage last year. Although we just invested according to our AA in our taxable brokerage account. We had 7 years left on a 20 year mortgage, and decided to pull the plug. It was partly because our AA was getting a little out of whack anyway, so we were planning to se...
by AC1984
Tue Jul 23, 2019 8:14 am
Forum: Personal Finance (Not Investing)
Topic: Paying Off Mortgage Question
Replies: 77
Views: 7484

Re: Paying Off Mortgage Question

You all are awesome, I so appreciate the nuanced discussion and food for thought on all this.
by AC1984
Tue Jul 23, 2019 4:36 am
Forum: Personal Finance (Not Investing)
Topic: Paying Off Mortgage Question
Replies: 77
Views: 7484

Re: Paying Off Mortgage Question

Max out your work retirement contributions--whether TSP or 457 or whatever. This is important because it's the best form of saving and it never hits your AGI used in IBR/PAYE payments. So you save more money on future loan calculations. If you don't make enough to comfortably max the retirement con...
by AC1984
Mon Jul 22, 2019 7:10 pm
Forum: Personal Finance (Not Investing)
Topic: Paying Off Mortgage Question
Replies: 77
Views: 7484

Re: Paying Off Mortgage Question

I love it when people think that conservative growth is 5-6% when we are excited when economic growth gets close to 3%. I also know that history is on your side but in history we've had more rational hands in charge of when to goose or not goose the economy. Our family has always said that we were ...
by AC1984
Sun Jul 21, 2019 3:44 pm
Forum: Personal Finance (Not Investing)
Topic: Paying Off Mortgage Question
Replies: 77
Views: 7484

Re: Paying Off Mortgage Question

I love it when people think that conservative growth is 5-6% when we are excited when economic growth gets close to 3%. I also know that history is on your side but in history we've had more rational hands in charge of when to goose or not goose the economy. Our family has always said that we were ...
by AC1984
Sat Jul 20, 2019 5:45 pm
Forum: Personal Finance (Not Investing)
Topic: Paying Off Mortgage Question
Replies: 77
Views: 7484

Re: Paying Off Mortgage Question

If that were the case, nothing and just keep paying the mortgage as is right? What other choice would you have? The mortgage is due regardless of market conditions. That's why holding a mortgage during retirement increases your sequence of returns risk; you must make the monthly payment even if you...
by AC1984
Sat Jul 20, 2019 5:16 pm
Forum: Personal Finance (Not Investing)
Topic: Paying Off Mortgage Question
Replies: 77
Views: 7484

Re: Paying Off Mortgage Question

So what do you do when the s&p losses half it's value? If that were the case, nothing and just keep paying the mortgage as is right? What other choice would you have? The mortgage is due regardless of market conditions. That's why holding a mortgage during retirement increases your sequence of retu...
by AC1984
Sat Jul 20, 2019 4:55 pm
Forum: Personal Finance (Not Investing)
Topic: Paying Off Mortgage Question
Replies: 77
Views: 7484

Re: Paying Off Mortgage Question

squirm wrote: Sat Jul 20, 2019 4:53 pm So what do you do when the s&p losses half it's value?
If that were the case, nothing and just keep paying the mortgage as is right?
by AC1984
Sat Jul 20, 2019 4:54 pm
Forum: Personal Finance (Not Investing)
Topic: Paying Off Mortgage Question
Replies: 77
Views: 7484

Re: Paying Off Mortgage Question

What they were referring to is known as a sinking fund. It's a good concept since it allows you to retain the liquidity of the funds since home equity is an illiquid asset, and, in this instance, stand a good historical chance of earning a higher return than the mortgage. I believe that it's perfec...
by AC1984
Sat Jul 20, 2019 4:18 pm
Forum: Personal Finance (Not Investing)
Topic: Paying Off Mortgage Question
Replies: 77
Views: 7484

Paying Off Mortgage Question

Hey everyone, so I recently listened to an intriguing ChooseFI episode focused on how or whether to pay off your mortgage on the path to financial independence. The idea was that if you have extra money available every month, to put into a stock index (VTSAX) instead of the mortgage payment, and use...
by AC1984
Thu Apr 04, 2019 10:54 am
Forum: Personal Investments
Topic: Bonds in taxable account?
Replies: 45
Views: 5402

Re: Bonds in taxable account?

We file taxes married but separate because of my student loans. Yes, my income fluctuates and some years may be over the limit and some years may be under. Am I incorrect in assuming she does not have to do the back door if she is under the limit and we file taxes separately? No, direct Roth contri...
by AC1984
Thu Apr 04, 2019 10:52 am
Forum: Personal Investments
Topic: Bonds in taxable account?
Replies: 45
Views: 5402

Re: Bonds in taxable account?

Let's say you have only stocks in your taxable account, but want to sell bonds and not take the hit from selling stocks while they're down. You go ahead and sell the stocks in the taxable account, then sell bonds from the tax sheltered account, and use the proceeds to buy stocks. Voila! Your asset ...
by AC1984
Thu Apr 04, 2019 10:50 am
Forum: Personal Investments
Topic: Bonds in taxable account?
Replies: 45
Views: 5402

Re: Bonds in taxable account?

I'm in an income based repayment plan, and so if I file taxes jointly then both our income is considered for the 15% of my AGI I owe every month (it's divided by 12). I would owe substantially more every month if they combined our incomes, more than I would save by filing jointly.
by AC1984
Thu Apr 04, 2019 9:59 am
Forum: Personal Investments
Topic: Bonds in taxable account?
Replies: 45
Views: 5402

Re: Bonds in taxable account?

We file taxes married but separate because of my student loans. Yes, my income fluctuates and some years may be over the limit and some years may be under. Am I incorrect in assuming she does not have to do the back door if she is under the limit and we file taxes separately?
by AC1984
Thu Apr 04, 2019 7:40 am
Forum: Personal Investments
Topic: Bonds in taxable account?
Replies: 45
Views: 5402

Bonds in taxable account?

Hi All, this forum has been really helpful in the past, and I'm hoping to get some insight into my next move. I'm 34, working full time, married (wife works full time), no kids. Combined gross income ranges between $165k-$232k depending on my overtime availability. I'm currently investing 20% of my ...