Hello,
Been reading MMM for about 4-5 months, and have been turning my situation around...this is my first post... Thank you for all the information on the site and forum so far!
I'll pose my questions first, then give my situation/info:
Question 1:
I believe I could pay remainder of my consumer debt except school loan and mortgage by April 1st if not earlier. Am I better off just paying monthly amount till paid off seeing as though the interest that would accumulate would be minimal and start my investment building (ideally would like to buy a multi-family property at some point, but open to other options as well)
The amount of debt is not psychologically paralyzing as it was before I started paying them down as I see the end very very near, but what is paralyzing to me now is my lack of savings/retirement/investments.
Question 2:
I'm an Internet Marketing Director and I make base of $90k plus guaranteed monthly bonus minimum of $4,500 (bonus taxed at ~40% since its bonus) - so my actual take home is right around $7-$8k. I actually love my job, and enjoy doing it everyday (love the people I work with too and come and go and telecommute as I please so it has a lot of freedom ) so I don't have any intent on leaving it voluntarily anytime soon. 10% pretax goes to my 401k (no company match). Earn too much for Roth IRA (however I do have money in Roth from previous years, but not a lot)
Does it make sense to put money in 401k when there is no company match? For me, it was just a way to guarantee that I save (pay myself first). If the answer is no, where should I think about placing it.
Monthly Consumer Debt Owed
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1) Car - owe $3,700, down from $18k in October 2012 ($375 minimum monthly payment)
2) Exec Line of Credit - $600, down from $9k in December 2012 ($305 minimum monthly payment)
3) Engagement Ring - $4k remaining ( 0% interest until Nov 2013) (divided up total owed by due date to pay off before 0% interest expires)
4) School Loan $9k ($105 monthly payment 5% rate)
5) Mortgage - $144k ($1179 monthly including taxes and insurance, plus $300 condo fees, 3.5% interest rate)
So my current outgoing is about $3500 per month, Once I get the car, line of credit, and ring paid off it will be down to about $2400 (probably even cut out more from that - working on that part now).
Both the line of credit and car, instead of paying lump sum, I divided up what i was sending in by 10 months and sent in 10 payments with their monthly coupons - so technically I don't have to pay again until Nov 2013, although will pay off before, but both credited to account now so it acted like a lump sum payment)
I could pay off the car today from savings, but that's about all I have in liquid savings.
Thanks in advance for any advice or suggestions.