Looking for some personal finance advice

Does mandatory monthly expenditures average include rent? If so, how much is the rent/mo?
Does mandatory monthly expenditures average include the ~300 for student loans then, as well?

Edit, and yea, i'd get a new bank account. Doesn't hurt you at all, and there are hundreds of no limit savings/checking accounts out there.

Quote from hAvAAck : Hi All. I feel kind of weird laying out personal details like this, but here goes - single 27 male; monthly income before tax - 5K; mandatory monthly expenditures average ~2600 Student loan 33K @ 3.29% IRA (0 contributed this year) = ~5100 on SPQAX long term dividend reinvest 403b offered - no match, nothing contributed retirement account mandatory ~5K will go into IRA when I leave this job No auto loan, no home owned Liquid ~13K, BOA required 10K minimum for .05% (need I switch banks?) Mandatory payment on my loan is $288 but I usually throw 300 at it, don't know if that is wise. I put all expenditures on Discover and pay it off fully, never carried a balance but I get the rewards. I don't churn credit cards or anything, haven't quite figured it out. My credit score is "excellent". I'm looking for advice into what I should be doing. I feel like I'm not managing what I have very well. I probably need to look into a new bank if I'm going to put any of my liquid assets into CDs or Roth IRA to get TVM. According to my net income I should really have more liquid, but I don't. Poor spending I suppose. I don't know how I feel about trying to do my investing myself because honestly I've never really been interested in learning about investment strategies and with no interest comes poor decisions. I have a 1998 car, if it were to break down or something I have enough to get another used car, no interest in a new car. Do I want to buy a home anytime soon? Yes I do, but I have no plan for that because I don't know if I want to stay in this area. What would you do if you were in my position? I appreciate any and all recommendations.

This is a good start with information. Your tastes are adverse to mine, but I think the underlying process in your mind is good.

I'd focus on budgetting first. Take a look at where your money is going and where is has been going over the past year. Know what you spend money on and what categories stick out as non-necessity. (personally, all the $20-50 dinner nights out seem cheap, but then I look at my overall spending on dining in a month and all of that missed savings is tough to swallow).

Get a different savings account - honestly, it doesn't really matter if you do though. Until your balance is something substantial ($25k is a good start, I personally see $75k as substantial), you won't really earn any interest. You can deposit to one of the higher interest rate accounts seen here on SD all the time. I would say do this just to put the cash at an inconvenience for you - if it takes 2-4 days to get the cash to your checking account, you're less likely to use it.

Save 6mo of living expenses (Say about $20k according to your $2600/mo), then start thinking of investing. If you don't want to worry about it, meet with someone and make a plan. All investing has a price. If you're working with an advisor, you might spend a small amount more, but hopefully you'll find someone you trust that will watch for your best interest. A good advisor will call you in the event he forecasts a market downturn, etc.

have you got health care,inflation is killing your savings get it out of the bank you would be better paying off some student loan your making 3.29% versus 05%
could you buy a place and have 3 roomates,

Quote from hAvAAck : Hi All. I feel kind of weird laying out personal details like this, but here goes - single 27 male; monthly income before tax - 5K; mandatory monthly expenditures average ~2600 Student loan 33K @ 3.29% IRA (0 contributed this year) = ~5100 on SPQAX long term dividend reinvest 403b offered - no match, nothing contributed retirement account mandatory ~5K will go into IRA when I leave this job No auto loan, no home owned Liquid ~13K, BOA required 10K minimum for .05% (need I switch banks?) Mandatory payment on my loan is $288 but I usually throw 300 at it, don't know if that is wise. I put all expenditures on Discover and pay it off fully, never carried a balance but I get the rewards. I don't churn credit cards or anything, haven't quite figured it out. My credit score is "excellent". I'm looking for advice into what I should be doing. I feel like I'm not managing what I have very well. I probably need to look into a new bank if I'm going to put any of my liquid assets into CDs or Roth IRA to get TVM. According to my net income I should really have more liquid, but I don't. Poor spending I suppose. I don't know how I feel about trying to do my investing myself because honestly I've never really been interested in learning about investment strategies and with no interest comes poor decisions. I have a 1998 car, if it were to break down or something I have enough to get another used car, no interest in a new car. Do I want to buy a home anytime soon? Yes I do, but I have no plan for that because I don't know if I want to stay in this area. What would you do if you were in my position? I appreciate any and all recommendations.

Based on what I see, I'm going to guess you have about $1,000 per month to save or invest.

First, I have a bias towards credit unions so, yes, I'd join a credit union and dump Bank of America.

Second, I'd open a Roth IRA at Vanguard and max it out here going forward. You could even take some of that $13,000 you have and use it to max out your Roth for this year. Since you have no interest in learning about investing (and this is perfectly OK), there is an option within a Roth IRA that is tailor made just for you: a target retirement fund. Simply choose the fund that most closely matches the year you plan on retiring and put all of your money into that fund. The fund will automatically adjust, becoming more conservative over time as you move closer and closer to retirement. It is truly a set-it-and-forget-it option.

Concerning seeking out a financial planner or adviser, you don't need one. Save your money and simply go with a target retirement fund. You'll make more money in the long haul going this route.

Regarding a dedicated rainy day fund, don't be overly concerned about this. You can withdraw your contributions to your Roth IRA at any time for any reason tax and penalty free. Simply open a Roth IRA, max it out year after year, and if you ever need to tap into your rainy day fund, you can withdraw it from your Roth tax and penalty free.

If you still have money left over every month after maxing out your Roth IRA (which, if my calculations are correct, you will), consider putting that money into the 403(b) available to you, but only if it's with TIAA-CREF. If it's not, then, more than likely, it's a rip off to put your money into it as it will be plagued with massive, hidden fees.

Regarding your student loans, are they federal or private or a mix of both?

With financial advice, some things are objective and others are subjective. You'll receive advice in multiple directions which will usually clash. All options usually have merit, so consider both and make your own decision within them.

Personally recommend to stay as far away from target date funds as possible.

Every single TDF I've seen over the last two years has been a clear-cut long-term loser.

Also, to clarify, do not find a financial planner. You should not be paying any kind of consulting fee or cost simply to have a conversation. Do, however, sit with an adviser who will turn your goals into a plan for free. A good adviser will save you money on your investing rather than charge you extra costs. If you're not familiar with investments, it is good to know that sometimes the products which appear to be free (No-Load Mutual Funds, for example) are sometimes the most expensive choice for a long-term investment.

I'm also an anti-credit union guy. They're great people and usually have one or two great benefits, but they're small and difficult to use in my opinion. I have accounts with two credit unions and three banks. There is no comparison between their overall offerings. Also, I only keep a negligible amount liquid, so interest rates don't matter to me. My money goes to my brokerage account as soon as possible.

Quote from zarfus : Does mandatory monthly expenditures average include rent? If so, how much is the rent/mo? Does mandatory monthly expenditures average include the ~300 for student loans then, as well? Edit, and yea, i'd get a new bank account. Doesn't hurt you at all, and there are hundreds of no limit savings/checking accounts out there.

yes, yes. Rent is 1085 right now, been looking to move and reduce that cost as it's way too high and has been for too long.

Quote from Formless : This is a good start with information. Your tastes are adverse to mine, but I think the underlying process in your mind is good. I'd focus on budgetting first. Take a look at where your money is going and where is has been going over the past year. Know what you spend money on and what categories stick out as non-necessity. (personally, all the $20-50 dinner nights out seem cheap, but then I look at my overall spending on dining in a month and all of that missed savings is tough to swallow). Get a different savings account - honestly, it doesn't really matter if you do though. Until your balance is something substantial ($25k is a good start, I personally see $75k as substantial), you won't really earn any interest. You can deposit to one of the higher interest rate accounts seen here on SD all the time. I would say do this just to put the cash at an inconvenience for you - if it takes 2-4 days to get the cash to your checking account, you're less likely to use it. Save 6mo of living expenses (Say about $20k according to your $2600/mo), then start thinking of investing. If you don't want to worry about it, meet with someone and make a plan. All investing has a price. If you're working with an advisor, you might spend a small amount more, but hopefully you'll find someone you trust that will watch for your best interest. A good advisor will call you in the event he forecasts a market downturn, etc.

I'm guessing you're right about the budgeting, sometimes I have no idea where my money went, but then I see this $30 or that $40 and apparently that adds up pretty quickly. I don't really waste money, but I could use it more wisely. I'll use mint.com to get a breakdown and see what categories are killing me.

Right now I have an "adviser" at my IRA through Ameriprise, I'll have to check with him about consolidating or managing whatever it is I should be doing

Quote from Brian1 : Based on what I see, I'm going to guess you have about $1,000 per month to save or invest. First, I have a bias towards credit unions so, yes, I'd join a credit union and dump Bank of America. Second, I'd open a Roth IRA at Vanguard and max it out here going forward. You could even take some of that $13,000 you have and use it to max out your Roth for this year. Since you have no interest in learning about investing (and this is perfectly OK), there is an option within a Roth IRA that is tailor made just for you: a target retirement fund. Simply choose the fund that most closely matches the year you plan on retiring and put all of your money into that fund. The fund will automatically adjust, becoming more conservative over time as you move closer and closer to retirement. It is truly a set-it-and-forget-it option. Concerning seeking out a financial planner or adviser, you don't need one. Save your money and simply go with a target retirement fund. You'll make more money in the long haul going this route. Regarding a dedicated rainy day fund, don't be overly concerned about this. You can withdraw your contributions to your Roth IRA at any time for any reason tax and penalty free. Simply open a Roth IRA, max it out year after year, and if you ever need to tap into your rainy day fund, you can withdraw it from your Roth tax and penalty free. If you still have money left over every month after maxing out your Roth IRA (which, if my calculations are correct, you will), consider putting that money into the 403(b) available to you, but only if it's with TIAA-CREF. If it's not, then, more than likely, it's a rip off to put your money into it as it will be plagued with massive, hidden fees. Regarding your student loans, are they federal or private or a mix of both?

I've been thinking about doing that with a ROTH IRA but then I also have the questions about an emergency fund. You put it out nicely and it makes sense.

My student loan is private (or 3x private and I calculated the combined rate), I paid off all of my federal loans already simply for peace of mind - it was about 15-20K spread around.

Quote from Formless : With financial advice, some things are objective and others are subjective. You'll receive advice in multiple directions which will usually clash. All options usually have merit, so consider both and make your own decision within them. Personally recommend to stay as far away from target date funds as possible. Every single TDF I've seen over the last two years has been a clear-cut long-term loser. Also, to clarify, do not find a financial planner. You should not be paying any kind of consulting fee or cost simply to have a conversation. Do, however, sit with an adviser who will turn your goals into a plan for free. A good adviser will save you money on your investing rather than charge you extra costs. If you're not familiar with investments, it is good to know that sometimes the products which appear to be free (No-Load Mutual Funds, for example) are sometimes the most expensive choice for a long-term investment. I'm also an anti-credit union guy. They're great people and usually have one or two great benefits, but they're small and difficult to use in my opinion. I have accounts with two credit unions and three banks. There is no comparison between their overall offerings. Also, I only keep a negligible amount liquid, so interest rates don't matter to me. My money goes to my brokerage account as soon as possible.

This is interesting to me, specifically your last point. How do you pay for things you buy when the majority of your money isn't immediately "liquid". I'm young and so perhaps the percentage of liquid for you equates to a lot more cash than the same percentage as me, but I always worry you know, what if my car breaks or what if there's an emergency. I never want to carry on the cc.

Quote from hAvAAck : This is interesting to me, specifically your last point. How do you pay for things you buy when the majority of your money isn't immediately "liquid". I'm young and so perhaps the percentage of liquid for you equates to a lot more cash than the same percentage as me, but I always worry you know, what if my car breaks or what if there's an emergency. I never want to carry on the cc.

I keep $5000 in savings. Typically, I never need to touch it for anything. I'm younger than you are, my employment income is lower, I have more student loan debt than you do, and I'm planning to buy a house later this year. Our discretionary income is almost the same, though, so I'm assuming your cost of living is higher.

My personal outlay:
5% of income to traditional 401(k) for company match
15% of income to Roth 401(k) (since there is a $17k cap on 401(k) instead of $5k cap on regular Roth IRA)
I pay off all revolving debt monthly.
I haven't been paying extra on my student loans over the last few months in an effort to save for buying a home. These funds are currently in my brokerage.
When I do pay extra, I only pay additional on those loans with a rate above 5%.
I keep $1000 min in checking and $5000 in savings at all times.
I have an individual brokerage account for short-term investments (day-trades, etc). My "savings" is here and regular contributions go towards dollar-cost-averaging.
I have an individual Roth IRA which I have contributed the max to and will for 2012 depending on house purchase. Funds would move here from the regular brokerage during tax season.
I have a traditional IRA which includes previous employer 401(k) rollovers.

If something happened with my car, the insurance would cover it. Or the warranty would cover it. Honestly, if it wasn't covered by either of these things and the repair cost $2k or more, I'd sell it and but another car. (Remember in my initial post where I said out tastes differ? I prefer newer cars and happily pay for them).

In other situations, when would I have an immediate (need the money in 5 days or less) for cash greater than $5k? I haven't experienced this need and cannot think of a situation where I would. If I can wait 3-5 days, I can liquidate something and transfer it over to my checking account. I can use a credit card for any large expense that comes up and have it paid off before the billing cycle ends.

Quote from Formless : Personally recommend to stay as far away from target date funds as possible. Every single TDF I've seen over the last two years has been a clear-cut long-term loser.

Two years is far too short a period of time to make a long-term evaluation.

Quote from hAvAAck : My student loan is private (or 3x private and I calculated the combined rate), I paid off all of my federal loans already simply for peace of mind - it was about 15-20K spread around.

Keep every statement showing your new, updated balance for each private loan you have as well as the final statement showing you've paid the loan off in full (when that time comes) for the rest of your life. Private student loan companies are notorious for getting amnesia years after you've paid off your loan and coming back to eat you up for supposedly not paying. Without proper evidence of having paid the loan off, you'd be a sitting duck for them to wreak havoc (or perhaps hAvAAck) in your life.

Quote from Brian1 : Two years is far too short a period of time to make a long-term evaluation.

In semantics, I agree with you.

In reality, I should have said that every comparison I've completed over the last two years has shown that compared to almost every other fund type, the TDFs are of low quality and sub-par returns.

Quote from Formless : In semantics, I agree with you. In reality, I should have said that every comparison I've completed over the last two years has shown that compared to almost every other fund type, the TDFs are of low quality and sub-par returns.

But for somebody who states that "never really been interested in learning about investment strategies" TDF's are a good choice. At least for a majority of their retirement portfolio.

I'd keep chipping away at the student loans, not overpaying it, 3.3% is effectively free money these days. My biggest advice would be to try your hardest to get ~5k/year into your IRA if you can, since you're not funding the 403b. One way to do it is to take 200 bucks every pay check and put it in, rather than putting in large sums.

I would try to save as much as you can, while living a life-style you enjoy, for a future house someday...but since you don't even know if you want to live in that area within the next 5yrs, I wouldn't buy a house.

I don't know about your area, so 1k may be a lot for rent...but if the location is important to you, that may not be something you want to fix. I'm paying more than 1k for rent