Hi folks, I'm back with yet another question pertaining to retirement funds. I'm a crazy 23 year old, I know.
After you all almost unanimously told me to max out my retirement contributions, I accepted the fact that my take home paycheck would be much lower than what I expected, and that's okay because I'd get the money back and more when it really matters. However, that didn't leave me with very much money to save, and I do want to break into the housing market within the next 5 years. Unless I want a crazy high mortgage payment through a low down payment FHA loan, I need to start saving some serious money, and if I contributed the maximum toward retirement while still saving as much as I need to, I'd have about $200 left over per month. So here's my question:
What are your thoughts on contributing only $5k a year toward retirement for 3 years, and having the rest of the $18.5k ($13.5k) moved automatically to my savings account with every paycheck? I say this so that I don't foolishly spend the money. After 3 years, that alone is $40.5k, and I'd probably be able to save about another $20k by living more or less frugally.
I know saving for retirement is SO important and to start early if I can, but living in Boston, any property you buy can so easily become an investment property. Renters will pay for the mortgage and then some, and I can hang on to it for as long as I can afford to. Ideally I'll be able to buy another property once I'm married or making more money, and then once I retire and the mortgage is paid off, it'll be pure income.
In my head it makes total sense and seems foolproof, but I wanted to check and make sure I'm not missing anything. I ran it by my dad and he told to "check with that awesome reddit group you keep talking about!"
Edit to add: My credit score fluctuates between 745-760 depending on the day- it was 795 before I took my student loans out so it's rising pretty quickly as I pay them down. My credit score is definitely not a barrier to home ownership if that's a concern!
Submitted May 04, 2018 at 09:41PM by theisraelee https://ift.tt/2jtjvBk
