Author Topic: Saving goals- Roth IRA or ER, or both?  (Read 321 times)

MyCircus, MyMonkeys

  • 5 O'Clock Shadow
  • *
  • Posts: 43
Saving goals- Roth IRA or ER, or both?
« on: December 03, 2018, 07:09:22 AM »
Hi,
We're tracking our money using YNAB, and are both finally maxing our 401k's. I understand the standard investment order is emergency fund (EF), 401k, HSA, Roth IRA, then taxable; but have a question anyway!

Our emergency fund is at $7k- for three months expenses, I think we should have $12k (or more). I'm currently saving $100 per paycheck to our EF.

We have one Roth IRA, at $2300. I currently contribute $50 per paycheck here.

We can't use an HSA (medical issues).

Should I change our savings allocations, to put $100 per pay period into Roth IRAs (start a second, and put $50 per, or just keep the one and put $100 per in?)? Or focus on saving our EF until it hits $12k? We both have pretty stable jobs, and our current EF could last for three months, if we had to (cut everything except food, insurance and mortgage).

Thanks for any help.

terran

  • Handlebar Stache
  • *****
  • Posts: 1942
Re: Saving goals- Roth IRA or ER, or both?
« Reply #1 on: December 03, 2018, 09:41:43 AM »

ditheca

  • Stubble
  • **
  • Posts: 219
  • Age: 35
  • Location: ST GEORGE, UT
Re: Saving goals- Roth IRA or ER, or both?
« Reply #2 on: December 03, 2018, 09:55:57 AM »
I use our Roth IRAs as the emergency fund.  My employment seems pretty stable, so there isn't a high chance I'll actually need to access those funds.

I've been doing this for three years, and this strategy increased my net worth by about $9000 in tax-free growth.  I'm glad I didn't have that money sitting in a savings account!