Personal Finance Weekend Discussion and Victory Thread for the week of October 29, 2021 |
- Weekend Discussion and Victory Thread for the week of October 29, 2021
- Grandpa is losing his license and likely won't live much longer, is underwater on his car, truck, motorcycle, and motorhome. Help me understand how to protect Grandma. Washington state.
- I think I’ve ruined my financial future by buying a house
- I financed a car with the rate of 24% APR almost 2 years ago and now i am having trouble.
- My parents are destroying my credit
- Leaving my job. What if they fire me before my two weeks is over?
- Where to put 60k
- Confused about term life insurance, considering a no-exam term policy.
- Offered a job but still waiting to hear from the place I really want
- I want to buy a car.
- Self-employment Tax Report Less than $10k
- All of the student loan questions
- Traditional or Roth 401K? (Walmart 401K Plan)
- Seeking Debt Payoff Strategy Advice
- I just got a phantom medical bill in the mail from a service that was allegedly performed 6 months ago
- Am I spending too much on rent?
- Would you pay for surgery with saved up cash or loan?
- Turn 26 next year, have a question on HSA
- How 401k rollover works?
- Receiving a $12.5k signing bonus, how should I spend it? More details in comments.
- Mortgage pre-approval is more than double what we expected. How is the loan size calculated? Surely we can't afford this, so why would they offer it?
- Is the prospect of buying a home in Southern California unrealistic for me?
- Investing or Emergency Savings?
- Fidelity Roth IRA investment help [24 years old]
- Wife defaulted on Credit Card and was taken to court
| Weekend Discussion and Victory Thread for the week of October 29, 2021 Posted: 29 Oct 2021 02:00 PM PDT If you need help, please check the PF Wiki to see if your question might be answered there.This thread is for personal finance questions, discussions, and sharing your success stories:
A big thank you to the many PFers who take time to answer other people's questions! [link] [comments]  |
| Posted: 29 Oct 2021 02:22 AM PDT Ok all, Grandpa is a finance nightmare. He has been for his entire adult life. Right now he is at the hospital stressed because he can't be at home rebuilding transmissions to pay the bills. He and Grandma live behind my parents house and do not have to pay rent. I really want him to be able to enjoy retirement at least a little bit, so I suggested we get rid of the car since he ain't going to be driving for Uber anymore, he doesn't drive it, and the payment on the car is a big part of his stress. I had no idea how upside-down he was. They offered $9,500 on his Prius and he owes $17,500 on it. I'd like to better understand the options. Voluntary repossession on the car seems ABSOLUTELY required. EDIT: I worked all night and I am finally going to bed, thank you everyone for all the help! I cannot wait to read through all of this with my parents this evening. Thank you thank you thank you for taking the time. You have no idea what it means to me. [link] [comments]  |
| I think I’ve ruined my financial future by buying a house Posted: 29 Oct 2021 11:08 AM PDT I'm in my mid 30's, gross 145k, net 75k. Married but my wife has an erratic income, net 30k now, possibly 15k to 0 in the future. We're in a high tax area and I'm forced to pay a lot into benefits because of forced retirement. We've been living frugally and saving up for a cross country move for several years now and have managed to get 175k together. Work dictated our move, so unfortunately the timing with the housing market wasn't great. To spare too many details, we bought something pretty quickly without getting a great feel for the market. Found a house in a great neighborhood, fairly renovated, had everything we wanted except it was way at the top of our budget. But we needed a place to live, so we put in an aggressive offer and got it. 4br 2ba 2200 sq ft, list 400k, appraised 410k, paid 420k. We put down over 100k. This all seemed fine to us considering the state of the housing market, we can afford it ok, and we figure if we're feeling squeezed in a few years we can sell and downgrade, that is until some details of our new reality started coming out. First of all, big property tax increase coming next next year. I accounted for an increase but not to this degree, from 6k per year to over 10k. My monthly payment will be about 2200, and at my stable income of 6200, this does not feel like it's leaving much to live on or save with. Especially considering everything is getting more expensive, we'll need to buy a car soon, maybe my wife is deciding now she may want to have kids, and onto the next issue… The house is old, which we were of course aware of, but we've already had issues that weren't made apparent by the inspection, namely old electrical. It isn't something that needs to be replaced now, but as it ages it's likely to cost us 20k at some point whether we repair it ourselves or knock it off a sale price. Additionally, the water heater, garage roof, roof, and hvac are all probably halfway or more through their life. I think realistically we could be spending 75-100k in maintenance alone if we stay in the house for 5-10 years. None of this felt like a death sentence until I really started digging into the market in this city. I've been keeping an eye on houses since we bought and every day it becomes more apparent how badly we overpaid. Our location is fantastic and walkable, plus the school district is the best in the area, but otherwise, 400k gets you a lot more in other areas. Our house is not laid out practically, there's no bathroom or closet on the first floor, the basement has areas where you can hit your head, the bedrooms are small and the closets are tiny, no master bath. It works fine for a child free couple but it makes no sense for anyone else. I must add also, this was a really cheap city to live in just 2 years ago. It is a far cry from anything like Chicago or New York or California. 420k is a ton of money here. It is still easy to find nice houses in the suburbs for 325k or less. Essentially we paid for location and bad market timing. I feel like I'm totally trapped now. If we stay in the house, we're only saving money while nothing is going wrong. It's only a matter of time something big happens and my wife's income dries up, and there goes all of our savings. I think if we sold this house right now we'd be lucky to get more than 350k considering what's been selling lately. So I'd be losing all or more of my 100k down payment. If we were to rent anything other than an apartment, we'd only be saving maybe 100-200/mo plus whatever we're spared in maintenance. If we go look for another much cheaper house to buy, we'll have very little for a down payment, so the payment difference between that and our current house wouldn't be all that much, could take 10+ years to get past break even. I don't know what to do at this point. I've completely set myself up for failure and I'm not seeing any way out. I need some wisdom and advice [link] [comments]  |
| I financed a car with the rate of 24% APR almost 2 years ago and now i am having trouble. Posted: 29 Oct 2021 04:14 PM PDT I financed a car, Honda Accord 2015 by February 2019 with 24% interest. The value of the car was like $15.000 at the time. For 6 years, $500 a month, i will ended up paying $36.000. It was horrible deal. I know. But i was so desperate because i was paying around $40-50 daily to Uber 5-6 times a week. That was a like $1000 a month. I thought instead of paying that. I would just pay $500 a month. The reason my interest rate was so high was because of my credit history and income proof. At the time i just started to work and i was getting paid with cash. They started to pay me check after for a while. So there was not enough proof to show them that i would pay besides my bank statements. My credit score was around 700 but i had only 2 credit cards with the limit of $500 each. So they told me i can get a car loan but the interest would be so high. So i accepted it. I was ok because i was able to pay. I did pay for almost 2 years. Until september. I missed 2 payments. I recieved a letter from them if i don't make a payment after last week of October, they will repossess my car. I called them and made some payment arrangements. So right now, i am trying to catch up my payments again and most likely i will be ok. But i am so disappointed that i have such a bad deal and i will end up paying $36.000 for a car that it will be less than $10.000 at the time it will be paid off. I don't think i can refinance with any bank because i already missed 2 payments. My credit score is 570 and it is going down every month because i already have few credit cards with full balance. I pay them minimum but still. I can't pay them off now. I don't know what to do. Is there anything i could do about this? Thanks in advance. [link] [comments]  |
| My parents are destroying my credit Posted: 29 Oct 2021 02:50 PM PDT My parents have me added to two credit cards, and they have decided to go over the limit on both of them this month. I've asked and asked to be taken off of their cards because I feel that even though it gives me 12 years of history, their constant high balance is throwing my score off when all my other cards have a less than $5 balance on them. They refuse to take me off (they say it's better for me in the long run cause of the 12 years of history). How do I take myself off? Is there any way I can do this without having the physical card? Thank you in advance. [link] [comments]  |
| Leaving my job. What if they fire me before my two weeks is over? Posted: 29 Oct 2021 07:08 AM PDT I plan on giving my two weeks on Monday, but I am worried that they may fire me and ask me to leave without pay for those last two weeks. For context I am in a temp-to-hire position with no minimum assignment length, therefore I feel like I am at high risk for being let go immediately. Would I be able to collect unemployment for those two weeks? Any advice would be helpful. Edit: Thank you for everyone's immediate responses. You gave me a few things to consider over the weekend. As it sits right now, I believe I will give a 1 week notice. I'll do this because I know the position will not be difficult to fill for them, I can comfortably cover not having 1 week of pay, and it is at least some professional courtesy because I don't want to burn bridges with the company. [link] [comments]  |
| Posted: 29 Oct 2021 04:52 PM PDT I have 60K sitting in my bank account and I know that's not the best place for it. I'm looking at purchasing a house within a year hopefully so I don't want to have it tied up in long term investments, and I know it sitting in my checking account is stupid. Crypto is too risky for me. Any suggestions? All of my monthly spend goes on whichever CC I am hitting the SUB for and paid in full every month. I have a leased auto at .9% interest and second auto loan at 1.89% with making some minor repairs to the second auto and then selling it. Other than that I have no debt. If this post isn't allowed/wrong I apologize. Thank you. [link] [comments]  |
| Confused about term life insurance, considering a no-exam term policy. Posted: 29 Oct 2021 06:02 PM PDT We decided to look into Term life insurance, decided against whole life insurance based on many posts I've read here. I'm thinking 20-30 year policy (we have a 1yo and a 30y mortgage) maybe even multiple policies with different terms. We already have a very sizeable chunk of cash in retirement and non retirement investments so we likely don't need as large a policy. My biggest concern right now is the medical. I'm worried that we will get stuck with higher rates than if we go with a policy that doesn't require the medical. Wishing we had done it a couple of years ago when we were both in better shape. Also not sure just how much family medical history is taken into account. I (F32) have always been borderline overweight, but no other health issues, well some joint paint but its always brushed off. Since I had our 1st child I cannot shift the baby weight, and I fluctuate between overweight and obese. My husband (M37) has had high blood pressure and been taking meds for it since his early 20s, his weight fluctuates between top end healthy and bottom end of overweight (usually top end of healthy). Had issues with acid, not much else. Neither of us are very active, unless you count carrying and chasing around a 30lb toddler. I'm also hella confused about some of the terminologies: riders, conversions, disability waivers, cashback. We have until the end of the year to get a policy in place since we just opted out of our employer policies starting Jan 2022 so we could put funds towards our term life policies instead (perhaps we should have started this process sooner....). [link] [comments]  |
| Offered a job but still waiting to hear from the place I really want Posted: 29 Oct 2021 06:42 PM PDT Hey pf! I'm in a bit of a dilemma here. Earlier this year I resigned from my job for multiple personal reasons and took the opportunity to enjoy a summer off which had been amazing. In the last couple of weeks of serious job hunting the offers have begun pouring in but most of them were refused due too low of salary / lack of negotiating or no room for advancement. Yesterday I did a video interview with company A that has an open position in my city as a department head of my areas second largest employer. It has insane benefits, excellent hours, and offers plenty of room for advancement and relocation (which is very attractive to me). The salary is about double what I initially made at my previous job. The interviewer expressed his interest in my talking points and my perspective skills that I could bring with me to this position. He said that he would need a few more days to fulfill the length of the ad before he can submit the final candidates for the next phase and that I should expect a call in the next 14 days. Today I had an interview with company B which was solely a contingency plan as a low level manager. The job is at a place that is a household name and has a very friendly atmosphere to it. There is room for advancement but its at a slower pace than if like and this particular line of work is slightly off the beaten path for me. I expected to interview, wait a few days, schedule a second interview, and hopefully by then have heard back from company A to make my determination. To my surprise the interviewer put me in touch with hiring manager directly afterwards and the second interview took place right then and there. By the time I got home and began to discuss with my gf I had a phone call from company B eagerly offering me the position. I was offered the exact salary as my previous job, pretty decent benefits, and very good hours Monday through Friday. I was offered the weekend to consider the offer. So now I'm in a bit of position. Accepting company B's offer would be acceptable to me and I like the schedule flexibility and the better work / life balance that it offers over my previous position, I also wouldn't need to make any major financial cutbacks. However with the potential for company A to request a follow up or even offer me the position all together in the coming week / weeks I'm not sure how to go about this especially with a deadline placed on this offer. Do I accept the offer and stall my start date hoping to hear from company A and then reneg my acceptance knowing it'll burn a bridge? Should I be straight forward with company B and explain that I have a pending final interview and potentially have them rescind the offer? Financially I'm ok in the short term but a positive cash flow would be very helpful especially if I make the wrong decision and lose the opportunity with both. Any advice would be extremely helpful! [link] [comments]  |
| Posted: 29 Oct 2021 07:30 PM PDT Hi all, I'm late twenties, unmarried, no dependents. 85.2k gross, 52.8k take home (after tax, insurance, 401k and HSA contribution) salary. I don't have a car. I have been waiting for a while now to get a car and live in a place without good transportation. I want to buy a car. Since the used market is pretty hot right now, I'm looking at a new car. I intend to keep the car for as long as possible. I'm looking at a Hyundai Elantra 2022 SE, OTD price of 24890. As such I want to get a reliable car. I have the money to buy this outright, but it would be a good chunk of my savings, and I also want to take the loan to build credit history. I am an immigrant and my credit history is thin, also am a first time car buyer - I have only one credit card with a credit limit of 2500 - I'm getting charged an APR of 6.9%. That means with 8k down I'm looking at a monthly payment of $404, for 48 months. I did the monthly expenses budgeting, and am looking at 29% savings with rent (900), utilities, and all other monthly expenses considered. I will likely be getting a raise this year though I don't know how much. At least 6%. That brings my savings up a little with the same expenses, to 32%. Of this I plan to make some contributions to a Roth IRA and to a S&P investment. I don't have any other debt (except for the potential upcoming car loan). The balance after all that will be about $500 per month assuming no raise. Wanted to get an idea if I'm spending too much on the car. I've heard of the 20/4/10 rule. My monthly gross income is 7100. That means with a 6.9% rate of interest and 20% down payment, I'll be paying 476 per month for a 48 month period. Adding 200 for insurance and 150 for gas, that brings me to 826, which is 11.6% of my monthly gross income. This is my first big-ticket item so I'm feeling nervous. [link] [comments]  |
| Self-employment Tax Report Less than $10k Posted: 29 Oct 2021 06:51 PM PDT Do I need to report taxes if I and my friend do a side job in which we earn $10k per year together (we will split it even)? We work by ourselves and aren't under an agency. We're both under 14. We live in Texas. The jobs we will be doing include washing cars, mowing lawns, and raking leaves. [link] [comments]  |
| All of the student loan questions Posted: 29 Oct 2021 02:56 PM PDT I am in my mid 40s, married filing jointly. We have a joint AGI of approximately $110K. I also have $155K in student loans. I have been paying on them on and off for, oh, almost 20 years, I think. For the past eight to ten years, the spouse and I have been aggressively trying to eliminate debt. However, spouse was also adamant that we buy a house five years ago because we were almost completely debt free (except for student loans, which I had already paid down to less than $90K). He purchased a money pit, and we are now back in considerable debt with frequent emergency repairs (electrical wiring caught fire, central heating died, basement flooded, leaking roof, etc.). So - student loans. I've been making payments before and after the passage of IBR. Since we purchased the house, and the wiring almost immediately caught fire, I applied for IBR (2016) and have been paying less than monthly interest, and thanks to the magic of capitalization, that's how the principal ballooned by over 150%. I owe about $90,000 in principal, and $65,000 in capitalized interest. During the moratorium, I took the opportunity to pay off several home repair debts. Then our boiler died, and both of our cars needed emergency repairs. $20,000 later, it's as if I accomplished nothing during the moratorium. With the moratorium ending, I'm trying to get back into IBR, or REPAYE, or something. Every single option seems to require consolidation, and my loans do not qualify this year. (I've already tried.) I have a 401(k), and I contribute up to the employer match percentage. Spouse has a pension (vested). We are rebuilding our emergency fund (currently at $1,000 after the recent boiler implosion and car repairs). My current options, starting 2/1/2022, are 50% of my monthly take-home pay (interest only), or 75% of my monthly take-home pay (standard repayment) due to my tax filing status. My income currently covers our food and servicing the debt for car and home repairs, and spouse's income pays the mortgage and utilities, and also debt from emergency home repairs. These two options are not economically feasible. My questions: Anyone else in the same boat? (Paying loans over the course of changing laws) Did you apply for IBR? Have you applied for some sort of extended repayment this year? Does the process seem different to you? Anyone else having issues with extended repayment options this year specifically? At what point does someone qualify for forgiveness? How do you ask for it? Do you have any recommendations? (Other than "make a budget." We have one. Thanks.) Notes: we do not eat out. We do not have a "daily latte" spending habit to cut (coffee is made at home). I'm actively looking for part time income, but due to my degree (legal), employers generally don't want me around. Bankruptcy would kill my career and prevent me from maintaining certain professional licenses. [link] [comments]  |
| Traditional or Roth 401K? (Walmart 401K Plan) Posted: 29 Oct 2021 03:37 PM PDT Hello my fine redditors! long time lurker here and I just recently started working at Walmart. It's the only place where it pays the most being $17/hr and for the first time I feel like I may stick around here for a few years (unless I win the lottery or get terminated lol) so I wanna enroll in the Walmart 401K plan. I'm 21 and started working here in late August. I want your advice/help to see in which basket(s) I should put my eggs in. Traditional or Roth 401K?? After being here for 2 months, on average I'm currently making $1,340+ a month but do plan on going full-time probably in Jan. The plan states "Walmart matches what you contribute dollar for dollar, up to 6% of your eligible pay!" so when I went on the site to enroll it automatically puts me at 6% (Which you can increase up to 50% btw) for the 'Pre-Tax Contribution' and there's another option for a 'Roth Contribution'. Now this is why I'm here, I need your help cause I'm a complete noob when it comes to this kind of stuff and I don't wanna screw anything up. I'm looking forward for what you guys have to say and if you have any questions, I'll answer right away! Thanks in advance! 👍 [link] [comments]  |
| Seeking Debt Payoff Strategy Advice Posted: 29 Oct 2021 06:03 PM PDT Over the past several years, my wife and I racked up a lot of debt through reckless spending and not paying off my student loans on time. This year, we've resolved to finally get serious and start paying off our debt before saving up for a new car, house, baby, and future vacations. We've basically been living our lives as two fun-loving young couple spending extravagantly on things and making up the difference with credit card debt. We are so sick and tired of carrying this debt around and we want clean up our act and really going through a couple years of austerity to become financially healthier. We have no savings and our investments consist of my small 401K which we won't touch at all. Of the listed expenses, I'll be paying my personal trainer for two more months per our contract. The MacBook gifts are a monthly payment for 11 more months for a pair of MacBooks I got for my siblings as a gift (very stupid financial decision, but I wanted to give them the best for their birthdays). I'm the sole breadwinner and my wife will be in college for 3.5 more years. QUESTIONS:
Thank you so much for your interest. Credit Score: 608 Monthly Income: $8,200 (post-tax) Monthly Expenses: • Gym: $120 • Personal Trainer: $390 • MacBook Gifts: $450 • CC Minimums: $1,685 • Rent + Utils: $2,200 • Gas: $55 Loan Details: ACC. APR BALANCE PayPal 23.99% $600.00 Chase 22.24% $5,240.00 Apple 21.99% $2,690.00 Discover 20.99% $14,300.00 B of A 20.24% $3,700.00 Discover 17.99% $3,679.00 Wells F 15.15% $4,160.00 Perkins 5.00% $3,117.86 102 DL 6.55% $1,433.93 106 DL 4.41% $4,444.82 108 DL 4.04% $6,451.06 103 DL 3.61% $7,971.95 101 DL 3.15% $2,972.44 Boot 0.00% $12,513.10 CareCred 0.00% $4,900.00 Total Student Loans: $38,905.16 Total Credit Cards: $39,269.00 Total All Loans: $78,174.16 [link] [comments]  |
| Posted: 29 Oct 2021 06:02 PM PDT I wasn't even aware that I owed money to this place until I got a notice from Credit Collection Services. I've never been to the place to the place billing me and it isn't where my PCP sends labs usually so I'm honestly stumped as to why I have a bill for over $300 from them. I have a few questions. Will this negatively impact my credit? Secondly, would it be too late for me to refer them to my insurance? Since someone likely missed something for me to be getting a bill for this much. [link] [comments]  |
| Am I spending too much on rent? Posted: 29 Oct 2021 05:45 PM PDT Hi! I'm getting an apartment soon, and the search for something nice has taken some time. I ended up stretching my budget a bit, and sprung for an apartment that costs about $2100 per month. Parking is another $200, utilities are on average $70-$150 (without internet). Assuming the worst case scenario, I'd be paying about $2500 per month. My income recently went up to the point where my take-home pay is roughly $6200 a month. I tried to do some budgeting - put in all of my fun activities, cooking, and other monthly expenses - and it came out that I'd have $2000 left over per month after all expenses to do whatever I want with. Including more to savings (currently don't have a major budget for saving). My company has no 401K yet. With all that said, I've seen people say numbers like that might be irresponsible. I wanted to get a sense for if I'm being crazy or not. Thoughts? Also, I'm single, no kids, etc. Car is paid off, student loans are paid ahead and accounted for in the monthly expenses I mentioned above. [link] [comments]  |
| Would you pay for surgery with saved up cash or loan? Posted: 29 Oct 2021 05:30 PM PDT I have $10,000 in cash that I made hustling door dash and also picking up a night janitorial job. I am living rent free at the moment... not for long. All my credit cards are paid off. I use them for small purchase and pay them off every month. I have $20k in savings that I am not touching. I have a drop shipping business netting $1,500 a month that is steady for now. I plan to move to Texas and to launch a store there. I'm building out my business credit as well. In the meantime I need a gum lift procedure done and braces. It costs around $7,500. My credit union approved me for the loan. However, I don't know if I should use it or pay with cash? Or should I save my cash and just get the loan $186 per month. (which I will be paying double to get it paid off quick). What's best? [link] [comments]  |
| Turn 26 next year, have a question on HSA Posted: 29 Oct 2021 09:18 AM PDT Hi All! Hoping you can help with a couple questions I have. I'm currently 25 years old, turning 26 at the end of April, which is when I'll have to get my own health insurance. Today is the last day to entropy in my employers benefits program for the year of 2022. I have a couple of questions regarding HSA & HDHP in general as that's the plan I would be choosing. 1) Is it worth paying for health insurance for the months of January - April when I'll still be insured through my parents? Is it easier to get health insurance independently once I turn 26? (not through employer) 2) If I apply for my own health plan, am I even allowed to have an HSA since I still am under my parents plan? 3) When X amount comes out of my check, does that amount automatically go into my HSA or is an HSA a separate account that I have to fund separately? I think it may be a dumb question, but just want to make sure it's not like I X amount from every check then have to put more into the HSA separately. Thank you all in advance! [link] [comments]  |
| Posted: 29 Oct 2021 04:30 PM PDT Hi all, I am thinking to combine a few 401k into the same account, and wondering if there will be tax included? I want to know how it works basically. So I know as long as I do not sell then convert the cash, then I won't be taxed. But for example, account A & account B do not have the same stocks/funds, then after rollover, how will my portfolio look like? Since there are some funds that are only available to specific companies. Or my assumption is wrong here, please suggest. [link] [comments]  |
| Receiving a $12.5k signing bonus, how should I spend it? More details in comments. Posted: 29 Oct 2021 03:42 PM PDT Title says it, I am receiving a singing bonus of $12,500 that will be split up as $5000 upon hiring and $7500 after my training (about 6 months). I have $65,000 in student loans, and my first year annual income is $43,000 and second year is $47000 (base salaries, there are opportunities to make more). Year 5 salaries are posted now at $72,000, so you can tell the funds increase each year by a good jump each time. I am graduating college this semester, no savings, and 6 months before I have to start paying my loans back. Since the US didnt apply interest to student loans because of Covid, I only accrued $40 in interest on all of the loans (accelerated program) so I basically only owe the capital. I dont know if using the sign on money to pay down my loans is a great idea, because the payments will be manageable, and they are something I was prepared to tackle even without the signing bonus. I want to invest the money into something that will benefit me long term. The job will require me to relocate, so I was thinking of using the cash as a downpayment on a home, but I dont know if I will qualify for anything really worth buying. I also considered putting it in an IRA or 401(k) or some kind of retirement/longterm investing. I just dont want to do anything stupid with it... Also, the numbers here are pretty much rounded off numbers, for the sake of any math. [link] [comments]  |
| Posted: 29 Oct 2021 09:06 AM PDT Just trying to better understand this. For some context, I grew up in a household where Dave Ramsey was preached on the daily. As an adult, I recognize that I don't really fall into the demographic that Dave is best for. So I say this to clarify that I recognize that I have some views on money that are healthy, but I also have some that are a bit out of context and perhaps unnecessary at this point. I'm just not entirely sure which is which. Husband and I are trying to buy our first house in a few months. Our combined income is about 160k/yr and doing the "3 times your gross salary thing" means we'd be looking for houses in about the 500k range. We qualify for a VA loan, so no mortgage insurance (although there are one-time fees depending on the size of your down payment), and we have good credit scores (both are around 790). We've got about 60k ready for a down payment, but because we don't have to deal with mortgage insurance, we'd prefer to do a smaller down payment and have the cash in hand for any repairs/upgrades we want to do immediately. No other debt to speak of and 20k in a separate emergency fund. All in all, we expected to be approved for something like 600k, so you can imagine our surprise when we were pre-approved for 1.2 million. My brain still can't even wrap around that number. A 1.2 million dollar house, even with just a 30k down payment and 2.5% interest works out to something like $5700/mo after taxes, home insurance and everything. That's nearly 45% of our gross take-home pay each month. Is the lender just assuming that because we've made good financial decisions this far, they can safely approve us for a huge loan, assuming that either 1) we obviously won't take them up on it or 2) if we do, we're financially literate enough to know we'll be able to pay it? The third option I suppose is that I'm just hung up on my frugal upbringing? This is just so much money, the potential consequences of a misstep here feel dire. [link] [comments]  |
| Is the prospect of buying a home in Southern California unrealistic for me? Posted: 29 Oct 2021 02:15 PM PDT Hi PF! After growing up and attending college in MN/WI and starting my career for 2 years in DC, I finally moved to Southern California in 2019. It's been a dream come true. I've lived in a few parts of SoCal but am currently in Orange County, renting a 2-bedroom apartment about a 15-minute drive from the beach for $2215/mo. I'm at the point in my life where I need to seriously think about the next steps, and jumping off the renting train in favor of buying a place to call my own. In an ideal world I'd do this in Southern California. I'm alright with an apartment-style condo or a normal home with a yard; I'd prefer 1400-ish sq ft but I realize I can't be too picky about size. The market in Orange County and coastal San Diego County just seems beyond the pale right now. I'm not opposed to going inland a bit, but housing there is also looking increasingly bleak (read: a crappy value). Inland OC or SD County would work, but even a cursory glance via Zillow indicates I may be priced out of those areas entirely ($500k-$700k for a starter home). One thing I do have in my favor is an incoming $100,000 windfall I'd like to dedicate almost entirely to the purchase of a home. That should be enough for me to avoid PMI for any home I can realistically afford. So I'd like a reality check here to see if I should defer my Southern California dream until a later stage of my life. I'm not opposed to buying a home elsewhere -- most likely closer to my family, e.g. Chicago or Milwaukee -- but if it's at all possible to make California work with my situation, I'd like to explore it. I work fully remotely and thus don't need to be within commuting distance of a major job center. Some other possibly relevant metrics:
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| Investing or Emergency Savings? Posted: 29 Oct 2021 07:13 PM PDT Hi All, I wanted to get some advice on whether I should be put more into emergency savings/big purchases savings or investing. I'm 29 years old and currently my situation is as described Recently Married Income: $120k per year Debt: $0 I paid my car off over the summer and have vowed never to take on anymore debt outside of a mortgage Emergency Savings: $10k now, I'm currently putting $2k per month towards emergency savings. (My wife has $70K saved but we are planning on using that as a down payment for our first home) Big Purchases Savings: $0 – Something I want to fund once we have our house as I would like to have a fund for maintenance/repairs 401k: $60k at the moment, currently putting $800 per month towards it Roth IRA - $400, just opened one and would like to be consistent in funding it HAS - $1500, currently putting $40 per month into the HAS. HSA is fully invested. My question is should I focus more on emergency savings or investing? I'm currently putting $2k into my savings account but feel I can be putting more into my 401k/IRA/HSA, especially since my wife is saving the majority of her income. The only thing is after the pandemic last year I want to be able to feel secure in knowing we have enough in savings to pull through any future downturns. [link] [comments]  |
| Fidelity Roth IRA investment help [24 years old] Posted: 29 Oct 2021 06:53 PM PDT I just opened a Fidelity Roth IRA and I'm not sure how to invest. [link] [comments]  |
| Wife defaulted on Credit Card and was taken to court Posted: 29 Oct 2021 04:15 PM PDT This all happened before we were married, or even met. My wife had a credit card when she lived with her parents. Before she moved out of state, she claims she called the credit card company and asked if she had an outstanding balance, and they said no. This was about 2013/2014. Apparently, she did have a balance. That racked up late charges, fees, etc. and got to about $5,000. Apparently, the court served, or attempted to serve, her at her parents address. She had no idea as she didn't live there. It went to court, and obviously, she was found guilty. (sometime in 2016 from what we can tell) Her grandfather lived in the house at the time and has some mental problems. My wife thinks he was likely served the papers and probably just threw them away. Her parents are odd, and we only found out about all this last year when we went to home to visit her parents for a week and her dad gave us a stack of letters addressed to her. One of which was from a lawyer trying to collect. This is in Maine, and my wife and I now live in Maryland. We really do not need her credit for anything, as I purchased the home before we were married, and make enough that she no longer has to work. I want to ask for proof of debt as the next step. Wonder if anyone has any advice on how to handle this or what our next steps should be. Being there was actually a judgement in court against her, I think that changes my options. Perhaps I should ask in legaladvice? [link] [comments]  |
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