Welcome to my pants. As an introvert it is somewhat terrifying and strange to drop my financial drawers to everyone, especially in front of such an enlightened community, and yet I find myself somewhat paralyzed by options here and I think this community will have a lot of good input.
If you have read my profile and initial posts, you know that I am a 29 year old homeless guy just embarking on a continent wide road trip with my long term girlfriend. We have detached from employment and home ownership. For purposes of this analysis, we can keep in mind that between the two of us we expect to make about $125K a year starting mid 2014.
I just completed rolling over my old 401K into an IRA and I am trying to decide what to buy with it. While I am at it I am reviewing what I should do with funds in my money market and Roth IRA accounts, along with the rest of my cash. Here is how it breaks down:
• Assets:
o Road Trip budget: $30K (enough for 9-12 months if we stick to budget) – should be $0 unless we get sick of traveling early
o Other Cash: BOA $10K ETrade: $42.5K
o Money Market:
ED $2.8K +38.4%
GE $1.6K -36.3%
JNJ $3.4K +40.6%
SIRI $.4K -7.9%
SWTSX $14K +48.3%
o Rollover IRA:
Cash $116K
o Roth IRA
V $8.4K +121%
VIG $11.6K +18.5%
NAESX $6.8K +40.1%
VFIFX $8.0K +30.3%
Cash $6K
o Truck – 2008 F250 $15K
o Camper – 2004 Okanagan 80W $10K
• Liabilities
o Student loans at 2% - $14K
• Expected future household income: ~$125K / Year
So – what are your thoughts on what I should purchase with my retirement accounts and/or cash? I was thinking I wanted to keep it simple with a Vanguard target date retirement fund for the IRA but could also see breaking it up into a dividend appreciation fund or other vehicle. Should I consolidate investments from my post tax account? Most of that motley mix of equities is from when I thought I was a badass stock picker right after college (and prior to the financial collapse…doh!).
Some might advise that I pay off the student loan – I could do this, but at this point in my life I like the idea of the cash and the $2% seems trivial….just in case something happens on this trip, you know? Also, although we are planning to rent for a year or so after the end of the trip, I would like to keep a healthy cash cushion for a house down payment in case our dream property presents itself.
Thoughts?