Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
My company has gone through some corporate changes. I was told today that I would be getting a bonus of roughly 17% of my salary (give or take) distributed on a quarterly basis. I have already banked my 2016 bonus and tax rebate for savings so I have a nest egg.
I'm basically planning to pay off my credit card debt in the next year via the bonus, and then next year, I'm thinking I will stuff the rest into one of my IRA accounts. Does this sound like a good plan?
Or should I tackle my other debts before adding to the IRA? I have a car payment and home improvement loan in addition to my mortgage. The car and the home improvement loans are low interest compared to the credit card though, and I think any investment in the IRA would out-earn that. My home also needs numerous upgrades (not frivolous - the whole thing hasn't been updated in 60 years).
Just curious how others think I should prioritize beyond getting rid of the credit card debt.
Agreed about paying off debt first. That will improve your monthly cash flow the quickest, so you can then likely use future monthly income to save more (without waiting for bonus).
From a strictly financial standpoint there is no reason to pay down say a 1% car loan when your money could be earning you 5+% somewhere else. With that said many people will argue it frees up cashflow and will help you sleep better at night, which is true. Its really to each their own, if you're paying down debt or investing it either way you being smart about using the funds. Just decide what would make you happier..
Sounds like you have a good handle on what to do.
Yes pay off the cc's and then keep then current each month.
You do not state age but I think from what you said I would do a ROTH IRA.
Then start paying off the highest interest debt.
That is a nice bonus. I understand getting rid of your credit card debt is important. However, how is your personal savings? Do you have 6 months to 1 year of living expenses?
Sounds like you have a good handle on what to do.
Yes pay off the cc's and then keep then current each month.
You do not state age but I think from what you said I would do a ROTH IRA.
Then start paying off the highest interest debt.
Already got quite a chunk in the Roth - not where I should be, but getting there. I'm 40.
That is a nice bonus. I understand getting rid of your credit card debt is important. However, how is your personal savings? Do you have 6 months to 1 year of living expenses?
I do not. However, if anything happened to my job, I could quickly slide into a freelance career (am slowly prepping to start my own business within 5 or so years and have a good handle on what I'd need to do). I can find a renter easily who will pay half the mortgage, and if necessary I can sell the house (in a very hot market) at a profit within a week if I have to (no joke). Because of that, I'm comfortable having only about 3 months' of savings in the bank. If I pay down the credit card debt as a priority, I will be able to save more money at a faster rate and accumulate a full year's worth of expenses fairly quickly. Further, I've had the same job for 10 years, with nothing but glowing reviews, not to mention a good reputation within my broader industry. The company I work for is on increasingly stable ground. I'm not THAT worried about my job. My boss already jokes that I've been there so long I know where all the bodies are buried. LOL.
The credit card is what is killing me. The idea of paying it off fills me with pure joy. I'll never put anything on one of those again once I get out from under this one. If I can pay it off, that will free up a chunk of change for savings every month.
The credit card is what is killing me. The idea of paying it off fills me with pure joy. I'll never put anything on one of those again once I get out from under this one. If I can pay it off, that will free up a chunk of change for savings every month.
Yep pay off those credit cards, and then NEVER carry a balance again, pay them off each month. Then get a cash back credit card and enjoy the 2% back.
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
