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OP, yoru auto loan really struck me. I didn't even read the rest of the post. I don't understand taking out a loan like that, when you say there wasn't anything left over after kids and tuition and rent/utilities, for savings. If you'd bought a good used car, of a brand known for reliability and longevity (hint: certain Japanese brands), you could have paid in the $3000 range, and all the rest of the money going to that loan could have launched your retirement savings. You'd have had about $10,000 now toward your retirement, and invested in the stock market with great care and selectivity, you'd have had more than that, because the amount would have grown on its own by now.
It's something to think about for the future. Or maybe you could trade in your current car for an older used one in good condition, pay off your loan, and start saving for retirement now, with the monthly income you had earmarked for your car loan. Speaking from experience, it's possible to buy a fabulously reliable family car for around $3000 (be sure to have a mechanic check it out before purchase), and have yourself a buggy that will last you 10 years or longer.
I briefly checked out the Edward Jones website earlier today and had wondered whether it seemed expensive. I believe I will check into investing on my own. I want more of my resources to be working for me instead of going into expensive commissions and fees, etc. Thanks for the tip!
Yes, I have some minor quibbles with Mr. Money Mustache's investing plan, but it's basically very sound. So you can find the investing articles on his web site.
To cut a long story short, I was in a horrible marriage for 13 years which ended in early 2008. Having to start over with 3 kids and no child support, I financed my way through school while also working 2 jobs, graduating in 2011. While a single mom, there was little money left for debt repayment or savings. I married my current husband (who is wonderful) 2 years ago. We have not combined our finances, because I am determined to not bring him down with my debt. I finally paid off my student loan this past Friday...yay! Now my only debt is < $500 credit cards, which will be paid off this month, and approx $13,600 auto loan. I have about $1500 in Savings, which will help me to not turn to credit cards if something should come up unexpectedly.
I'm feeling somewhat anxious because I turned 45 about 3 weeks ago, and right now I have little savings for retirement...altogether around $45K. This is in two 401Ks and one 403B. (One 401K is from a job not worked since 2008, and the other 401K and 403B are from current jobs.) I've been seriously considering contributing $5500 per year up to age 49 into a Roth IRA, then $6500 per year after that. If I budget carefully, I can contribute the first $5500 by the end of this year (been paying extra on auto loan and next payment is due October 2019.) Then I can contribute around $460 per month to equal $5500 per year. I hope to keep making extra payments to my auto loan and pay it off next year as well. (My ex absolutely loved racking up massive quantities of debt on worthless crap, and my kids and I suffered for it. Now I feel like I'm smothering by having any debt at all.) Then I hope to max my contributions to my 401K and 403B. Then I hope to somehow invest whatever else I am able toward retirement savings, perhaps around $500/month in addition to the 401K/403B and Roth IRA. At this rate, over the next 20 years or so will it be likely for me to have a fairly comfortable nest egg for retirement? My husband has a decent amount saved in his 401K for his age so far, but I want to feel like a good contributor at that time.
BTW, since my part-time job is variable with how many hours are available, I plan my budget around my full-time job. My goal with the part-time job for now is to increase my Savings to at least 6 months expenses. Then I'll probably use that income for some projects I'd like to do around the house sometime, or something of that nature.
My 401K is at least 10 fold of what it was when I was 45 15 years ago....just takes discipline and living below your means provided your income is good.
If you work until 65, then you have plenty of time to save. If you can, a job with a solid 401k will help you save way more than the $5500 in an IRA, but if you can't do that, well $5500X 20 = $110k just by yourself, your husband matching is $220k.
The problem with this is OP will probably not work till she is 65. Not that she doesn't want to but her employer will want to go with someone cheaper and younger and let her go in her 50's. This may sound harsh but it's the truth. That's why people should start to save when they are young and right out of college so that when they get to the 40's, you are set in life.
OMG I can't believe you are feeling anxious? Look at all you accomplished!! Please do not discount fighting for your happiness and the well being of your kids and it sounds like you have not become bitter and I'm betting you are a fantastic mom. Believe me I know women who couldn't get their act together because of living in the past.
So kudos to you. I have no doubt that you will hit your goals, cut yourself some slack, lol enjoy your new honey-bunny. You've got a well thought out plan.
The only advice I would say is remember that financial "plans" are not made out of cement, they are made to be fluid. I know I'm close to retiring and still tweak mines.
Best of luck.
The problem with this is OP will probably not work till she is 65. Not that she doesn't want to but her employer will want to go with someone cheaper and younger and let her go in her 50's. This may sound harsh but it's the truth. That's why people should start to save when they are young and right out of college so that when they get to the 40's, you are set in life.
???? what? I'm 57 and many of my coworkers are in our 50's and 60's. where do you get that from?
The problem with this is OP will probably not work till she is 65. Not that she doesn't want to but her employer will want to go with someone cheaper and younger and let her go in her 50's. This may sound harsh but it's the truth. That's why people should start to save when they are young and right out of college so that when they get to the 40's, you are set in life.
Perhaps in your field but most of my colleagues are professionals (M.D, PhD, JD) so they don't get a decent paycheck until their 30s and aren't established in their field until 40s. They certainly don't get let go when they are 60.
I briefly checked out the Edward Jones website earlier today and had wondered whether it seemed expensive. I believe I will check into investing on my own. I want more of my resources to be working for me instead of going into expensive commissions and fees, etc. Thanks for the tip!
These books would be a good place to start your education:
The problem with this is OP will probably not work till she is 65. Not that she doesn't want to but her employer will want to go with someone cheaper and younger and let her go in her 50's. This may sound harsh but it's the truth. That's why people should start to save when they are young and right out of college so that when they get to the 40's, you are set in life.
Yes, this is a very good point. I say it all the time on CD myself.
Yet at the same time, it looks like our OP is giving it her best shot. So at least she won't be totally destitute if she loses her job in her 50s.
We didn't start saving for retirement until age 40, but have been very aggressive since. We made a budget that included retirement saving and stuck to it.
There are two ways to do it. Make more money (not always possible) and spend less (always possible). We drive older cars and use cheap cell phones on low monthly plans. In fact, my cell is 7 or 8 years old and a dumb phone, no tunes, no web surfing, nothing but phone and text and only $25/month. No cable. No lavish vacation trips. Grow 30% of our food supply in the back yard.
After saving for IRA investing, try to put something extra away into dividend-paying stocks. That will build up a passive stream of income apart from IRA withdrawals.
You can do it.
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