Intro
My large credit card debt is all at 0% APR interest. Please see my posts on taking advantage of no fee 0% APR balance transfers for more information. In short, I’m borrowing the money for “free” and keeping it in safe investments while earning me interest. I received another $10,000 this month from one of my two new credit cards.
Thoughts
Lots of money moving around this month. In addition to the $10,000 coming in from balance transfers mentioned above, my wife and I also maxed out our Roth IRAs for 2006. It’s almost like we funded our IRAs with credit cards. Of course, this moved cash into retirement accounts, which leaves us farther away from our Mid-Term goal of $100,000 in non-retirement funds.
Although we are saving steadily each month, I’m not really satisfied with the pace at which we are going. I feel much of it has to deal with inadequate time-management on my part. There is much I want to do, and it’s already February!
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Your Roth IRA increase is very impressive,ok,I know you did your contribution of $4,000 last month,your target fund where you have your Roth IRA did great last month. I think you have a Vanguard Target Fund if I remember correctly.
Hey, any chance you can share with us how you made the progress bars in the upper right corner?
thanks
I have a questions: My wife and I are beyond the roth IRA limit and we have maxed out the 401(k)s, do you think it is worth saving $4,000 each as a non-tax-deductible regular IRA ? I would rather buy I bonds or pay down my mortgage at 4.75% even though I know the IRA account could appreciate more. I want to keep the option open of taking out money from the IRA. Does the 10% penalty apply only for the amount you take out over the 4000 that you put in ? ( since I did not take a tax break when I put it in ?)
thanks
Probably a dumb question, but I’m curious about the equation up there for figuring the value of your car.
(KBB/PP-$500)
Pretty precise too, as we’re seeing the value go down gradually in your monthly updates.
I get that KBB is the blue book value. What’s PP? Why minus $500? And I assume there’s a website you’re using to update the blue book value each month?
Thanks in advance!
Sid:
It depends on how much you have already contributed to your retirement. If you’re ahead of the game (that means you’re relatively heavy on equities already), you should find some safe investment vehicles that give you a return of more than your mortgage rate (4.75%), say bonds or CDs.
Al – wife and I both maxed out Roth, so that’s $8,000. The rest is Vanguard Target 2035 + 2045 mutual funds, yes.
Anon – Microsoft Paint. I wish it were some JavaScript, another project I want to do.
Sid – It’s hard to say without knowing the rest of your situation. If you make an early withdrawal from a non-deductible IRA that is not qualified (disability, etc), then you will be penalized 10% + pay income taxes on your *earnings* only. As far as I’ve read your original contributions can be taken out tax-free.
Anon – I just go to Kelley Blue Book (KBB.com) and type my info in and get a price for free. PP = Private Party value. And then I subtract $500 to make it more conservative. I could just pick the wholesale value, but that’s how I started out so I just stuck with it.
I also have an entire other older car that is not included in the calculations. I just like to track the value of this car because I might sell it soon.
Jon,
Why don’t you break out your CC float savings from your regular savings accounts? Wouldn’t that give you (and us) a more accurate view of your financial situation?
TT
I don’t understand. What’s not accurate? Money I borrow on credit card is listed as a liability, and also in the cash savings. ALL the credit card debt is at 0% APR. Subtraction leads to the correct net worth, no?
I think doing it any other way would actually confuse me more.
Personal finance bloggers net worth data (chart and graph) has been posted.
Neo
Anonymouse:
As a retirement account you will pay a 10% penality and income tax on ANY non-qualified distribution. You would be better off just putting additional money into brokerage account.