Author Topic: Should I make my 2016 Roth contribution ASAP?  (Read 1277 times)

free_fries

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Should I make my 2016 Roth contribution ASAP?
« on: January 20, 2016, 09:49:20 PM »
Hello my title pretty much says it all but wanted to get people's thoughts on my situation.

My particulars - mid-30s, single, US west coast HCOL city renter.  I was recently laid-off from a 95k (gross) job that wrapped at the end of the year.  Upon notice, I decided to finish out my term, travel in Q1 2016, and return to cube life in late March/early April.  I had planned to make my 2016 Roth IRA contribution post-travel once I had secured a job but with VTHRX being down Iím contemplating doing it now.  I hate shopping but love a sale!

Letís do the numbers-
2015 average monthly take home pay - $4,755
2015 average monthly expenses - $2,400 (cringe! down from 2014 average, continuing to trim)
Jan 2016 income - $2250 take home (unemployment +a couple hundred missed on final paycheck)
Jan 2016 expenses Ė$1,900 (projected)
Cash on hand $21.9k (started hoarding cash a few months back in preparation)
Retirement accounts - $126.5k
Debt- $0

I am about to start traveling for 6 weeks during which I will not file for unemployment so income will be $0. My projected expenses for those 6 weeks are $3,600. 

Funding my Roth now would drop my cash on hand to $16.4k and then post-trip cash would be ~$12.8k.  However once Iím back, Iíll have a (small) surplus since job searching means Iíll be receiving unemployment payments.   They would end in August so I shouldnít need to touch my cash until then.

Typing this all out I think Iíve convinced myself to buy now, should I reconsider?  Maybe stocks will be even cheaper in 6-7 weeks? 

Thanks for reading!


Heckler

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Re: Should I make my 2016 Roth contribution ASAP?
« Reply #1 on: January 20, 2016, 09:57:46 PM »
Maybe stocks will be even cheaper in 6-7 weeks? 

Thanks for reading!

TL:DR. (I just learned what that stands for ). ;)

Maybe stocks will be even more expensive in 6-7 weeks. How will that change your long term plan?