Hey all,
Title says most of it. I am 25 years old. Bachelor's in Political Science (originally intended to go to law school, never went). Job I am currently at does not require degree. I will provide financial details:
INCOME/ASSETS (~$2,500/month):
-
Salary: $~40,000 after OT
-
Take home estimate (month): $2,500 after 4% for 401k and health insurance
-
Roth IRA: ~$11,800 (contributed $5,500 in both 2016/17) Vanguard Target Date 2055 Fund
-
Emergency Fund/Savings with ALLY Bank: ~$22,000
MONTHLY EXPENSES (~$1,500/month):
-
Rent: $550 (will be $370 when 3rd roommate gets back from deployment in July)
-
Groceries/Food: <$300
-
Used Truck Warranty: $126 (12 of 24 months left, 0%)
-
Dog: ~$100 (including food, treats, toys, yearly vaccinations, and monthly meds)
-
Gas: ~$120
-
Spotify: $10 (will be $5 when I split family plan with SO and friend)
-
Utilities: ~$70 (internet/electric, will be cheaper when 3rd roommate comes back in July)
-
Life: ~$100-200 (category label in my Mint for various expenses such as date with SO, going out, activities, random or unexpected purchases)
SAVINGS:
- Usually around $1,000/month depending on unexpected purchases or impulse buys (guns are an expensive hobby)
MY THOUGHTS & QUESTIONS:
Even if we round up to $2,000/month for expenses, to cover 6 months of expenses, I only need $12,000 in that ALLY Savings account. That leaves me with $10,000 to invest in a non-tax advantaged account. My original thoughts were to dump most of it into VTSAX (read on here that it is a favorable index with low fees) and put the rest into bonds. My second guessing is deriving from the fact that I like having one fund to track, through one company (Vanguard), which has been performing fairly well. Would I be crazy to throw $10k more into the same fund (VFFVX), but obviously not an IRA. To the best of my knowledge, they diversified it very well, as these guys are experts and I doubt that I could (without a ton of luck) throw together a better portfolio than them. If you wouldn't recommend I do that with the $10k I have to invest, what would you do?
Also, I read into HSA's being a powerful/supplemental vehicle for retirement. My only problem with maxing that out is that I read you should max your 401k out before doing that, which I am nowhere near capable of doing. Also, I like the rate I can save at and would not necessarily want to drop my take home. I actually just increased my tax allowance to 1 on my W-4 to bring some more in as OT was just recently reduced. I already did calculations based on last year to make sure I am still paying proper amount of taxes (should end up getting ~$400 back for 2017 year). I currently do not contribute anything to it, but my employer offers $600 free a year for completing wellness challenges (I have $550 of this already) and also pays $9.61/pay period, which I think is great. What are your thoughts on contributing the max or near the max for my HSA as opposed to leaving the balance at around $800/year from employer contributions while not contributing more than employer match of 4% to 401k?
Last topic. My company offers an ESPP at a 5% discount. I have been looking into this and pending specific terms of the ESPP, it is usually and immediate and guarantee return towering over a 1% savings account. The terms I have read that are favorable is obviously a good discount (5% is not great IMO), purchase price is lowest of beginning or end of period (mine would be only the closing price at end of the period), and how quickly you can sell shares (mine is said to be a max of 5 business days). Based on the terms my employer offers, would you put the max 10% towards this for a +/-5% return on about $2000 max per 6 months? Does that 5% (which could go down in that 5 days) less tax make it worth it, especially with added tax return efforts?
For anyone that sat through that whole thing, thanks for taking the time to read my long spiel of where I stand. Any and all opinions, suggestions, questions and recommendations are welcome.
Thanks again, TNB_
Submitted May 02, 2017 at 04:31PM by thenatureboy_ http://ift.tt/2pFiOZS
