newly debt free and need advice

[knockknoc]

After struggling all through my 20s and early 30s, I am finally debt free and able to save. It feels awesome, but I'm a bit overwhelmed.

I have $1,000 in a savings account that I plan on making monthly contributions of $100 to. I also contribute 6% (my company's match) to my 401K.

My questions are: 1) once I hit $2K in my savings, should I transfer it to a Roth IRA? 2) should I also invest in a low-cost index fund, buying shares on a regular basis?

By way of background, I'm 34 and make $50K per year. Any advice would be much appreciated.

Thanks

[maat55]

You need to build your emergency fund to 3 to 6 months expenses. Then, you could open a Roth account with T.Rowe Price to invest monthly with a minimum of 50 dollars per account.

[knockknoc]

Thanks for the reply. Guess I'll keep my head down and keep adding to the savings until the emergency fund amount is reached.

[disneysteve]

I agree with maat55. First build the EF while continuing to get the full company match on the 401k. Once the EF is funded, opening the Roth is a good idea. Also, though, you need to be saving some money outside of retirement accounts for other needs like car/home repairs, next car purchase, vacations, etc. You don't want to lock up everything in retirement accounts.

[MrPolarZero]

Well, it looks like that you are on the right track. Your choice of investments are actually rather good, and I would definitely encourage you to pursue the index funds.

[MrPolarZero]

Originally Posted by knockknoc

After struggling all through my 20s and early 30s, I am finally debt free and able to save. It feels awesome, but I'm a bit overwhelmed.

I have $1,000 in a savings account that I plan on making monthly contributions of $100 to. I also contribute 6% (my company's match) to my 401K.

My questions are: 1) once I hit $2K in my savings, should I transfer it to a Roth IRA? 2) should I also invest in a low-cost index fund, buying shares on a regular basis?

By way of background, I'm 34 and make $50K per year. Any advice would be much appreciated.

Thanks

I think opening a Roth account would be a good idea. Since it is the simplest and most effective way of having a sheltered account, you can be assure that you can save a higher amount of money in the future