Where should we put our money?
May 23, 2014 5:33 PM Subscribe
My family's combined income just increased by over 50% in the span of a week, between a new job for my husband and a significant raise for me. This is obviously AWESOME. We went from living on a very tight budget so we could afford to put some savings away, to have a couple thousand dollars a month beyond even that savings. What do we do with it?
posted by raspberrE to Work & Money (14 answers total) 11 users marked this as a favorite
We already donate/give and will increase that in proportion to our new income. We have been saving about 1/3 of our monthly income up to now, but that is all pretty short time savings (like for yearly taxes/insurance/tuition, car repairs, house repairs, vacation) - after recently paying off the last of a student loan, we have about 5K saved for various near-future expenses. Beyond that, we have no savings other than retirement accounts through work.
We each contribute the maximum to our IRA that our employers match. Should we increase our contributions to those accounts? Should we open some other type of retirement account?
What about longer term (but not retirement) savings - like saving for a new car or new house/home addition 5-10 years down the line? Should that be in some kind of account other than just a regular bank savings account?
We have no debt (including mortgage - we own our home outright) and are planning to continue living well within our current means. Our biggest goal is to remain debt free (even when we decide to move to a larger house) and for us to be able to live on one income for a few years once we have children. I would say we are somewhat counter cultural in how we view money... we are not interested in getting super wealthy, we live in a way smaller/crappier house than we could afford to, and plan on living below our means for the rest of our lives. With that in mind, how should we plan/save for these goals of remaining totally debt free and having the freedom to live on one income for a while?