Reflections on all things $$$

iVillage Member
Registered: 12-12-2004
Reflections on all things $$$
9
Tue, 06-06-2006 - 1:35pm

Good afternoon everyone. After the checking account mess, I am getting back on track. Here's the grand total of savings plans each month. Comments? Suggestions? Feedback? Ideas? All welcome.

l) ING Savings: $200/month. Correct info, set date, set up. Finally!
2) Credit union E-fund. Rebuilding. $400/month.
3) TIAA-CREF--$200/month. No problems. Ongoing. Automatic.
4) Savings account--permanently closed.
5) Big Jug of Change---put in change each week. Too heavy to lift. Guesstimate of $ in there, but I just dump the change in with a funnel device. That is the money toward something we "need" but not sure what to do with it at the end of the year. Ideas?
6) IRA-$100/month
7) 401K-type thing: $200/month
8) TSA thing: varies by amount each month--$400-$500/month.

So, if I want to build up an account of 6 months worth of what the paychecks are, which one do I pick? ING? TIAA? Credit union? Thanks. Whiz.

iVillage Member
Registered: 03-27-2003
Tue, 06-06-2006 - 3:07pm

What are all of these accounts for? Do car payments or other payments get deducted from the accounts or what? The only ones I understood were IRA, 401K and Big Jar of Change.

Heather

iVillage Member
Registered: 06-23-2005
Tue, 06-06-2006 - 4:25pm

It looks like you need to clearly define which accounts are for "retirement" and which are for "savings". If they are retirement investments, they should not be considered liquid emergency funds. Only those accounts that ARE liquid (like you can get the money out quickly for an emergency) need to be considered as your 6-month Efund.

If you're still paying down debt, it looks like an awful lot of money is going into these other funds instead of the debt, mortgage, etc. Can you update us on your debt? I can't quite remember what your overall picture was.

iVillage Member
Registered: 12-12-2004
Tue, 06-06-2006 - 6:01pm

Hi, again. To clarify on the list:

l) ING Savings--replaces the bank savings account that I closed. Better percentage rate. Started this after reading members' suggestions on how the rate was better than a regular savings account. (it is)
2) Credit Union E-fund---supposed to be for emergencies, not necessarily 6-months worth of funds. In the past, have used it for vet bills, paying on medical bills, pharmacy (i.e., prescriptions), or for buying gifts. The bank no longer offers a Christmas Club account, so I was hoping to have this replace that, perhaps?
3)TIAA-CREF--Mutual Funds mix. For retirement or investment mix.
4) Savings account---used to have $$ funneled from the checking to this, but was too much of a temptation to raid it.
5) Big Jar of Change. Started this after reading Becky's idea of dumping change each week into it. I guess some folks use it as vacation fund, Fix=it fund, etc.
6)IRA--for retirement. Have this set up from payroll deduction.
7)401K--for retirement. Payroll deduction. Lately the funds, regardless of this mix (stocks, bonds, mutual funds, international, utilities, etc.) are not returning well. Can change percentage of contribution.
8) TSA--Annuity. Started this a few years ago (at work) for retirement. Hope this helps. Whiz.

iVillage Member
Registered: 05-09-2005
Wed, 06-07-2006 - 12:45am

Hi Whiz,
TIAA-CREF--$200/month.
IRA-$100/month
401K-type thing: $200/month
TSA thing: varies by amount each month--$400-$500/month.

All of the above are usually retirement accounts -- I'm guessing they are for you -- so
$1,000.00 per month for retirement

ING Savings: $200/month.
Credit union E-fund. Rebuilding. $400/month.

The above 2 look like savings accounts, so, 600.00 per month for savings.

So Whiz, you are putting about 1600.00 per month into savings/retirement.

One of the other posters wondered about the debt you might be carrying. If you are paying off any debt, then I would strongly recommend (per Dave Ramsey) that you cut way, way back on contributions to retirement accounts. He even recommends stopping all contributions until debt is paid off. He thinks you can make up for lost time by putting all the money you were paying toward debt each month into the retirement account once the debt is paid back.

You would have to let us know what your monthly bills are -- regular bills as well as any debt payments before we could give any input about the retirement/savings accounts.

If you are having any difficulty making your monthly bill payments, then you should consider cutting back on savings/retirement.

I know ING lets you have multiple accounts, so you may want to consider moving the Credit Union $ into an account at ING. Do you have the Credit Union account because you have loans or credit cards with them???? I have never known them to pay a very high interest rate on savings if that is why you have the account with them.

So -- more information from you would make our input more reasonable. I'm personally impressed that you can come up with 1600.00 above and beyond your bills to put into retirement/savings. I have pretty much stopped our contributions to retirement while we get the 1,000.00 emergency fund funded again. There is always an emergency!!!!!!!!!!
Megan

iVillage Member
Registered: 12-12-2004
Wed, 06-07-2006 - 2:14am

Hi, Megan, ladies. Well, the total amount may take some doing and digging. Ballpark numbers:

ME:
l)Capital One credit card: Was a "transfer" of a big-debt cc to this with lower interest: about $4300. It was upward of about $8K when I did the transfer (can't remember exact month, but about Dec.'05). Why so large? Last of the hospital bill of 8 months dickering with ins. company, etc. was on it, and some other out-of-state charges (medical).
2) Discover. $1400.
3) Gas cards. Paid in full each month.
4) NO other cards. All cancelled, closed, cut-up. Been that way for awhile.

DH:
1)AT& T universal card. About $800
2) AMEX--varies. Usually paid in full each month
3) Discover--paid off.
4) Gas cards--paid in full each month. That should shrink considerably now that DH isnt driving a lot to work.
5) CC name eludes me, but this is down to about $1200.
6) Other cards? Paid off. $17K in bank. Mortgage: Chase (original loan sold to them by the company we refi'd with): About $345K at a FIXED rate now (no more ARM). Paid by DH.

Medical ins. (me) About $100/month.
Medical ins. (DH)--not selected yet, so I dont know how much it will be for both of us. Personally, I dont want HMO. When he gets it, I am ditching mine.

SHould I get rid of credit union? Not sure. They offer attractive rates, lots of people at work use them instead of a bank. Dont know much about it.
Things I'm considering doing: Getting second job (have talked about this forever) where there are better benefits and getting something better than the 2% rate of return that the 401K at work has. Projected expenses. More medical (me). Breast biopsy, possible surgery. DH (knee) Recurring dermatology appts. Am using the credit union thing for this, so instead of a great $1500, I have $200 in it (again) as I take $$ out to pay medical as I go. That's about it. Whiz.

iVillage Member
Registered: 05-09-2005
Wed, 06-07-2006 - 3:19am

Hi whiz,

You list about $7700.00 in credit cards: Cap 1, $4300.00 Discover, $1400.00 AT&T $800.00
and "name eludes me" card $1200.00

Then you say:
Other cards? Paid off. $17K in bank.

Are you saying you have $17,000.00 in the bank? If you do, then my strong suggestion is to pay off the 4 credit cards you have. Dave Ramsey does not suggest saving the 6 months of monthly expenses (the BIG emergency fund) until all the credit cards are paid off.

And Whiz, what are the "attractive rates" you are getting at the credit union?????
If it is less than the ING or Emigrant Direct online banks pay -- you still might consider changing from the credit union to one of them.

If you have the cash to pay off the credit cards, and you still want to contribute as much as you can to the retirement accounts -- check with your employer to see if they offer any other 401K accounts -- 2% is awfully low.

It's probably time for you to see a financial planner really -- one that you pay for their time; one that is not going to sell you anything, and only give you advice.

Anyway, it looks like you really have things under control -- and you would be in a good place if you could pay off the credit cards and maybe start to pay extra to the mortgage.
Megan

iVillage Member
Registered: 06-23-2005
Wed, 06-07-2006 - 10:33am

Whiz- I agree with Megan in that you should really considering speaking with a professional financial counselor (not a broker, salesperson, etc) and have them advise you on your setup. With the accounts you have and the amount you are pouring into them, you really don't want to be going in the wrong direction or in too many different directions with them. There's something to be said about being "diversified", but you want to be "diversified correctly", right :)?

I think your bills could be wrapped up very soon if you were to cut back on the savings and maybe a few of the retirement investments for a short period. DH & I have taken Dave Ramsey's advice and stopped all retirement contributions until our credit cards & a HELOC are paid in full. Then we will start up again and eventually reach the 15-20% goal he recommends for retirement savings.

I think you're doing great keeping track of all these given your DH changing jobs and all the medical billing issues you've had lately. I do think that someone on the outside looking in could possibly give you a very clear picture of where you stand and where you're headed for the future.

Hope we've helped with your question :).

iVillage Member
Registered: 05-10-2006
Wed, 06-07-2006 - 12:36pm

Whiz,

I understand wanting to keep an account at the credit union. If something happens you can use that money while you wait for the money to be transferred from the ING account and then you won't need to charge an emergency. I am one that hates cc so I would take a hunk of your savings and pay those off Then cancel as many as you can - I like to keep one because I will not charge a hotel room or car rental to my debit card. I had a hotel put a hold on my card years ago for not a no show charge and I was staying in their hotel at the time!! My sister had a hotel put a hold on her card and it wasn't removed for over a month. That is one thing I can't agree with Dave on, I do not want my money held hostage because someone screwed up their books!

Plus once all the cc are gone, you should be able to save a nice emergency fund fairly fast!!

I would absolutely talk to a financial planner (I got an invitation in the mail to talk to a American Express advisor for a $25 Costco gc which I am going to do) and see if the retirement and investment funds are doing the best they can for you. I think you have too much spread around but I am one that likes to keep things simple so the different funds may be doing good work for you. A professional will know more on that.

You really sound like you are doing good.

iVillage Member
Registered: 12-12-2004
Thu, 06-08-2006 - 12:16am
Thankyou ladies for your advice. I agree---(DH definitely agrees) that I am spread out all over the place with the investments. Who do I go to? An independent person? Someone affiliated with Fidelity, etc.? To answer Q's: 1) DH got the 17K after the refi. It is staying there. Why? So we (I) wont be tempted to blow it on something, or in case one of us gets laid off. SO, it is staying put. 2)Credit union. Good idea to move things over to ING. I just opened this, so am waiting to see what happens. Closed the savings acct at bank for this purpose. 3) What I wish I could do (dont know the answer) is to put more away, but the MAX you can put in 401K is 15-18K/yr. Ditto for the annuity. 4) DH is almost done paying off his credit cards. ONly thing he has left will be the car payment (his). 5) Want to save for a new kitchen, but it would take a few yrs! Anyway, we are current on everything. The bad thing is the mortgage of 350K. At least it is fixed now. Once we get things paid off, even if I pay about $5K extra, I want to make it like a 10-15 yr thing. (dreaming). Tell me where/who/what kind of person I would see for advice. Thanks. A very grateful and humble Whiz.