hehe - I almost wrote "spend" and imagined the choking that would happen among MMM readers.
But seriously - I have a surplus problem and, not being a financial professional, find the multitude of options for "saving" highly confusing and stressful. I have a great fear/hatred of debt and thus, for the past few years, threw everything into getting rid of all debt as soon as possible. Having emerged blinking into the debt-free sunlight, I am now wondering what the next "goal" is.
Some background. I'm a single woman in my early 30's. My risk tolerance is VERY low and tend to avoid anything that has significant (or perceived) risk. My long-term plans are uncertain, but tend to stability. In 10 years I'll either be married with kids, a nun, or single and at risk of being eaten by my cat. My "dream" is to buy a plot of land and build a super-efficient house with a great yard (thus being able to finally get a pit bull puppy) with potentially rentable separate units.
I make about 50K/year (40K take home). Apart from the nunnery I don't foresee any change in career or significant change in income. I love my job and will NOT slave away at a job I hate for more money (my mom keeps trying to convince me to move to the MeTrocity). Lord knows when I'll be called home and I'd rather be working in a job I love now than earning lots of money for the "benefit" of retiring early that I might not get to enjoy.
Last year my "extra" income went to paying off my student loans and buying a "new" car (a total of about $10,000). In June I will be downgrading my rent and freeing up about an extra $1,000 a month (long story). Thus, at the end of this year, with no other reduction in spending, I will have $16,000 extra. Next year it will be closer to $22,000.
I have a 401K plan through my company into which I've been putting rather minimal amounts (last year was about $6,000 total (me + co). It's not a match - no matter how much I put in the company puts in 5%. I have my contrabutions split 5% pre-tax and 1% post-tax in a Roth (seemed to hedge bets on future tax situation). Having seen my parents' 401K get gutted in the crash this gives me the heebie jeebies.
I'm looking for suggestions for proportions to save for retirement -vs- save for down payment, tax reducing options, or in general.