Nonostash: Some thoughts & questions...
-Congrats on your progress so far!!
-Dave Ramsey is great for getting out debt, not so great for his advice on investing.
-Do you have a mortgage or are you renting? Do you have any plans to buy a home at some point in the future?
-Do either of your employers offer a match for retirement contributions?
-Normally, I'd ask about your income to see if your student loan interest is deductible, but after 2012, if nothing changes, it will only be deductible for 5 years after graduation. Even so, that student loan interest rate is insanely low. Is it fixed or variable?
-Why don't you calculate the two extremes. Use a paycheck calculator (I like the one from ADP) to see if you put the absolute max into your retirement funds to just have enough to live off of, how much would you be contributing? On the flip side, how much can you put towards loans if you put nothing into retirement? Probably, if your interest rates are fixed, you're best off just paying the minimum, but some people are averse to debt, so that's a pretty personal decision. At least looking at the two sides would let you see trade off in black and white.
Thanks! We're pretty excited about it! I've been the one dragging hubby along with all this, but he's coming around little by little and motivated by how much we've paid off so far.
- I'm glad to have found MMM because I feel DR was a great starting place for us, but we don't really want to baby step our way through our entire financial lives.
- We rent. No immediate plan to own, due to the debt we're paying off, no down payment, enjoy having the apartment complex come replace the dryer when it breaks (a couple months ago), and not working in careers/locations that we see ourselves settling down in.
- No match for either of us. My husband is essentially self-employed, works as a massage therapist at several locations (1099's) and private clients (need to look into how this is documented, actually - we just track what they pay him and claim as income on Schedule C, I think... I'm wanting to learn more about this so I can do our taxes. We currently have a tax guy since I have had a home-based side biz for last few years).
- - I work in public sector so my mandatory 7% is put away into PERS, but I don't really consider this system as a guaranteed source of retirement income for us, as I only have about 1.5 of the 5 years to be "vested" and don't see myself retiring from this line of work to get their "2% at 55" carrot they dangle. Most likely I would end up rolling my contributions into an IRA after I move on to what I want to be doing. For now, I'm grateful that I have this job and the health insurance with it.
- I'm not sure our exact income as it varies with my husband's work, but for 2011 we grossed $78k, I think this year will be a little more. The SL's are through the government... I guess they're variable as they've fluctuated between 2-3% since I've had them (going on 9 years now... ugh!).
- I guess I'm debt adverse in the sense that it makes me sick to have it. Mostly the CC's & cars though. The low interest rate SL doesn't make me that sick, other than the fact that I didn't really need SLs to get through school, only in order to avoid the "starving student" lifestyle because I thought I "deserved" luxuries I couldn't afford because I was "working so hard in school". What a brat! LOL
- Right now we are putting about $2500 toward debt. The minimum payment on the SL is $137/mo. I'm not sure exactly what you're suggesting I calculate and compare... the amount we could make on investments if we saved the ~$2363/mo vs. pay off SL as fast as possible (~Oct 2014) then invest the entire $2500/mo going forward?? Just trying to wrap my head around what numbers I'm looking for...
Thanks for the cheers and questions! Would love to hear more advice! :)