Author Topic: Where should we put our extra $14,000?  (Read 1864 times)

BriArrange

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Where should we put our extra $14,000?
« on: May 13, 2015, 02:13:16 PM »
I need some much needed advice! We recently just sold our gas guzzling over priced dodge truck...woohoo! Now, we have an extra $14,000, but we don't know how we should use it in the best way....

Our scenerio:

Loans
$5,800 @ 2.8% in student loans
$20,000 Agriculture Line of Credit (Husband's a farmer and needed it for repairs, etc.)

Plus, we are expecting our first child! :) We are so excited! But, we do not have much saved up for this. I plan to become a stay at home mom once the baby arrives in September. We will not have any medical expenses, if everything goes smoothly, as they all paid for already. But we only have a $500 in our baby fund.

EDITED : I guess I should include all our assets in this as well. Sorry!

We have a house. 117,000 left on a ten year mortgage at 3.9%.
The 20,000 line of credit is at 4%.
Husband rents land for farming so we do not own any farm land. (Would like to eventually down the road.)
Our other car is paid for in full and is worth about $3,000.
DH is putting 10% into his 401K (is a mechanical engineer full time as well and just started.) Want to put more into 401K, but don't want to stretch ourselves too thin as we are trying to pay off our loans

So, what is the best way to disperse this extra cash that we have? Any advice is greatly appreciated! Thanks.
« Last Edit: May 13, 2015, 02:25:11 PM by BriArrange »

RexualChocolate

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Re: Where should we put our extra $14,000?
« Reply #1 on: May 13, 2015, 02:16:15 PM »
You have no other debts, or assets? (Farm, House)

You are otherwise cashflow neutral (ie, spending what you take in, savings rate 0%)?

I'd leave it in cash for upcoming expenses.

FrugalFan

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Re: Where should we put our extra $14,000?
« Reply #2 on: May 13, 2015, 02:16:52 PM »
Congrats on the baby! I wouldn't feel comfortable with just $500 in the baby account, as there can be a lot of unexpected expenses. I would divert a bit of the $14000 K to that and pay down your higher interest loan first (you didn't say what the rate was on the line of credit). If you don't need the extra baby money, you can divert it a bit later.

MDM

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Re: Where should we put our extra $14,000?
« Reply #3 on: May 13, 2015, 04:42:42 PM »
So, what is the best way to disperse this extra cash that we have? Any advice is greatly appreciated! Thanks.
As others have already suggested, knowing more about your current/projected cash flow would help responders.  See http://forum.mrmoneymustache.com/ask-a-mustachian/how-to-write-a-%27case-study%27-topic/.

E.g., even as parents of 5 we aren't completely sure what you mean by "baby fund"...?  E.g., is that a college fund?  ...newborn clothes/diapers fund?  We could guess, but better to know.