| Advice on finances and retirement. |
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birdtrax
New Member
Cash: $ 1.25
Posts: 6
Joined: 04 Jul 2011
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| Advice on finances and retirement. |
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Hello, I am 46 years old, married with a 4 year old. My wife and I together make around $37000 a year. I have a house payment of $967 (includes insurance, taxes, etc) at 5%. I owe $125,000 on a house that I might be able to sell for $115,000.
I also have 90 shares of Walmart stock and 50 shares of Caribou Stock. I work for a non-profit and owe $19,000 on student loans.
My wife wants to buy a car that we need for around $12,000 and I don't know how we are gonna swing it.
I invest $100 a month into TROWE (Capital Apprciation and New Horizons), $75 into a bank and $75 into walmart stocks. I owe $1500 in credit cards.
My questions or concerns are:
1) Am in the right investments, trying to be balanced?
2) Anything I can do on the house payments to lower besides re-finance (did in 2009).
3) Will I ever be able to retire?
4) What would you do different and why?
5( I feel I am never gonna be able to retire.
6) Want to start my MASTERS degree but cannot afford it and am afraid to choose wrong field again (currently have my teaching credentials B.S.)
I also invest $25 in a 529
Life Term Insurance $105 a month
Capital Appreciation - Joint Tenant PRWCX $723.13
New Horizons - Joint Tenant PRNHX $2,573.74
Prime Reserve - Joint Tenant PRRXX $600.37
U.S. Bond Enh Index - Joint Tenant PBDIX $8,949.06
Capital Appreciation - Roth IRA PRWCX $36,779.05
Capital Appreciation - Traditional IRA PRWCX $7,192.20
U.S. Bond Enh Index - Traditional IRA PBDIX $4,023.39
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Mon Jul 04, 2011 6:21 pm |
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oldguy
Senior Member
Cash: $ 751.85
Posts: 3656
Joined: 21 May 2006
Location: arizona
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quote:
Want to start my MASTERS degree but cannot afford it and am afraid to choose wrong field again (currently have my teaching credentials B.S.)
The household average income is about $60k in the US - higher for couples with an education. So the non-profit is big a drag on your family's financial well-being (you obviously knew thsi when you selected it, most non-profit workers aren't in it for the money, LOL).
As for adding to your $19k loan to get a Masters Degree - it won't be much help, probably a negative when you consider that your retirement is only about 19 yrs away.
You've done very well with what you earn - $75,000 in investments, a modest house payment, as well as the skills to manage a $37k income.
I would want to get rid of the WMT and Caribou. The overall market (PRWCX) gives an average return of about 11%/yr. And so does any one of the individual blue ribbon stocks (WMT) that make up the market. So - the expected return is abut the same - but the individual company carries the added risk of a sector failure or even a company failure (GM, etc). That is uncompensated risk, the worst kind.
You have quite a few bonds, maybe $15k counting the ones in PRWCX - but probably OK at age 46.
But overall - the income is the limitation. Can you change that? - teachers average about $45,000 in most parts of the US, add your wife's income to that - it could be quite a boost.
Cars, for most couples, are a major cost - we spend too much. Modern cars provide about 200,000 miles of troublefree service, we've been getting that for yrs (we mostly stick with japanese makes). Most road failures - the ones that affect reliability & safety - are tires, brakes, batteries. You can replace all 3 for <$1000. But ironocally, people will spend $20,000 to trade cars to avoid spending $1000 on the car that they own.
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Mon Jul 04, 2011 8:34 pm |
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littleroc02us
Moderator
Cash: $ 384.35
Posts: 1891
Joined: 09 Feb 2009
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IMO, I don't think you'll be able to retire in 19 years with a lot of money and No I wouldn't go back to school and spend more money. I strongly believe your main problem is your income. If you want to clean up your debt you need more. Is there any public or private job you could take where you'd earn much more? How about your wife?
Here is how I'd answer your questions:
1. I think you shouldn't be investing in Walmart and other single stocks. Why not try Roth IRA's through Vanguard. You and your wife can max them out each year at 5k a piece. In 25 years making 10% on your money both you and wife would have a combined 1.3 million tax free for retirement. If you invest for 20 years both of your will have 700k.
2. As for the house payment, I would pay off the school loans first and then concentrate on the house next by adding additional principle payments to expire the mortgage early.
3. refer to #1
4.Again, establish an emergency fund first of 1k, then pay off your school loan, then invest in mutual funds for 20 to 25 years, then pay off the mortgage
5.20 or 25 years
6.Forget about it and find more income.
Risk comes from not knowing what you're doing. (Warren Buffet)
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Tue Jul 05, 2011 1:38 pm |
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jaden
New Member
Cash: $ 1.70
Posts: 8
Joined: 29 Jun 2011
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| property investment loans |
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Hello,
Some people have the idea that investing is risky. Movies such as “Wall Street”, no doubt, lead people to think that. But the fact is that investing is only as risky as you want it to be. Do you want to take huge risks? You can invest in international stocks. Want to play it safe? Go with bonds. The risk level is up to you and only you.
Thanks..
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Thu Jul 07, 2011 9:06 am |
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jaden
New Member
Cash: $ 1.70
Posts: 8
Joined: 29 Jun 2011
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| property investment loans |
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Hello,
Great post, what you said is really helpful to me. I agree with you anymore. I have been talking with my friend about, he though it is really interesting as well. Keep up with your good work, I would come back to you.
Thanks..
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Fri Jul 08, 2011 8:49 am |
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debedwards
Preferred Member
Cash: $ 21.70
Posts: 106
Joined: 19 Aug 2011
Location: Connecticut
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You're 47, married, with a kid and you only have life term insurance. Well, that's the only thing I see wrong in the picture. Once your coverage expires why not switch to long term care insurance or get a final expense insurance. In that way you can protect your little one and your wife if ever something happens to you and your assets will be safe too. As for the final expense, it can be used to pay off debts, mortgages and other expenses. If you're still quite confused better ask for the help of your relatives or friends.
elder care specialist | long term care insurance costs | life line screenings
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Fri Aug 19, 2011 8:43 am |
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keshavmish
Full Member
Cash: $ 11.00
Posts: 50
Joined: 16 Aug 2011
Location: india
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One way to make sure that you will be able to handle your retirement income well is by getting recommendations and suggestions from skilled individuals on how you should go about with your finances. Here is some retirement planning advice that you might encounter:
1. Start investing your money, not just spending them. Try to make your money work for you, not the other way around. Wouldn't it be nice to just sit still at home and watch as your investments bring in more income for you? It's time to study mutual funds and try your luck at it. And once you've gotten the knack at it, you can try venturing into stocks trading.
2. Never ever withdraw from your 401k loans or pension unless you really have to. Kick off the temptation to cash it off just to buy that new car. Because if you do, you might be putting yourself in some trouble as withdrawing such funds may cause you to extend your working years just to compensate for the withdrawn amount.
3. Know the ins and outs of the finance market. It is very unwise for you to put all your savings to a single investment. Try experimenting and dividing your funds into several pursuits. That way, there is minimal risk of getting bankrupt just because your investment choice went down the drain.
4. Patience is a virtue. If you really want to make the most out of your retirement savings, then you really have to wait for a while. Always try to resist the temptation of slacking down on your savings just because the future doesn't seem to near. Eventually, all those sacrifices and savings will pay off.
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Sat Aug 20, 2011 1:05 pm |
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