Hello fellow forum readers. I am new to Mustachianism, and am wondering what direction to take. I currently have about $2,000-$3000 extra income each month. I am curious if I should pay off debts, save, or invest.
I have a pension that is matched by my employer, as does my spouse.
Here is my outlook
Category Monthly Comments Annual
Salary/Wages for earner #1 $4,500 $54,000
Salary/Wages for earner #2 $3,800 $45,600
FICA base salary/wages $8,300.00 $99,600
pension contribution $500 $6,000
Life/LTD Insurance $65 $780
Subtotal 2 $7,735 $92,820
Other ordinary income (e.g., tIRA distribution) $3,000 $36,000
Rental income $1,375 $16,500
Rental taxable income $1,375 $16,500
Federal Total Income (for IRS tax) $12,575.00 $150,900
Federal tax $2,693 2017 rates, S, stand. ded., 1 exempt. $32,322
Soc. Sec. tax $508.40 Assumes 2 earners paying $6,101
Medicare tax $118.90 $1,427
Total income taxes $3,321 $39,849.35
Monthly Average Expenses:
Mortgage $2,609 Input to Itemized Deductions $31,308
Cable TV $45 $540
Car Insurance $125 $1,500
Car Maintenance, Registration, etc. $15 $180
Childcare $500 Input to Child and Dependent Care credit $6,000
Dining (Lunch/Dinner/Etc.) $100 $1,200
Electricity $150 $1,800
Fuel/Public Transport $100 $1,200
Gas/Oil for heating $50 $600
Groceries $200 $2,400
Hair Care $20 $240
Internet $50 $600
Pets $20 $240
Phone (cell) $80 $960
Phone (landline) $60 $720
Non-mortgage total $1,515 $18,180
Loans:
Student Loan $200 $2,400
student loan $379 $4,548
car loan $430 $5,160
car loan $477 $5,724
0 0
Total Expense $5,610 $67,320
Total to invest $3,179 $38,151
Summary:
"Gross" income $12,675.00 $152,100
Income taxes $3,321 $39,849
After-tax income $9,354 $112,251
our debts are as follows.
Home/business mortgage $380,000 4% 20 year
Car loan 1.99% $12,000
Car Loan 3.29% $19,000
student loan 6.5% $4,300 (I plan on paying off this first as it is small and easy to do)
student loan 6.5% $25,000
We just paid off our credit card debt and are looking to move forward. Should we save up an emergency fund? I think we should take care of the student loans, then work on the car loans, while keeping a credit card as an emergency fund. On the plus side, our business may be paying out more soon and we will have a large windfall of 10-20k. I am just looking for some advice on what steps to take. Save or pay off debt would seem to me the first options. when debt is down, then work on investments. Or do I invest now, to lower taxable income.