Paid off CC... what now?

billybob · #1 (**permalink**) 03-06-2006, 01:56 PM

Hi
So i finished paying off my CC (finally), and I am trying to figure out what to do with my money. Currently I am putting 10% of my pay into my 401k. This leaves me with roughly 800/month to "save". I opened up an ING account and an Emigrant account, and am currently putting money in those, and I am trying to keep about 500 in my bank's savings account for quick-access needs.

As far as goals, other than retirement, I am really just saving to maybe someday have a downpayment on a house; as well as any other things I may "need" along the way.. (computer, TV, car/repair, vacations, etc).

So I guess my question is, should I be investing in anything other than these High-yield savings accounts, or is that good for my needs?
Thanks

JoyJoy · #2 (**permalink**) 03-06-2006, 02:05 PM

Congratulations!!! You must be on Cloud 9 with no credit card debt!

When it comes to investing, you have to have objectives like when do you plan to buy your house? Do you have an emergency fund set up of atleast 3-6 months monthly income?

Your savings portfolio looks really good!

billybob · #3 (**permalink**) 03-06-2006, 02:08 PM

Well, I'm not sure when I would want to buy a house. I guess when I have enough money saved! (3-6 years?)

I suppose that yes, I do need to build up the ol' emergency fund. But once that's in place, then what?

Thanks

JoyJoy · #4 (**permalink**) 03-06-2006, 02:35 PM

Quote:

Originally Posted by billybob

Well, I'm not sure when I would want to buy a house. I guess when I have enough money saved! (3-6 years?)

I suppose that yes, I do need to build up the ol' emergency fund. But once that's in place, then what?

Thanks

I have a few months to go (Nov., 2006) and I too will be credit card free, but in the meantime I have opened an account with HSBC and Emigrant Direct and have a longstanding savings account with my credit union. I am just sitting back savoring the victory that will soon be mine and reading books on investing too. The advice I have gleaned from some articles is to first build up an emergency fund, know your objectives like when are you going to buy your home, how much do you plan to spend for the house so you can make a decent down payment. Look into the type of mortgage you want to procure, etc. Your goals, according to your post, are to buy a house and fund for retirement. I would be reading material that will help you achieve those goals. Sit back and relax and make notes! You're doing the right thing by saving. Read up on short and long term goals. Go to an investment board and pick up copies of Smart Money and Money Magazine. Glance at websites like www.wall-street.com/directlist.html for direct-purchase of stocks and companies who pay strong dividends www.dividendachievers.com and get a feel of investing! Hope this helps as I am a "newbie" at all of this too!

Ima saver · #5 (**permalink**) 03-06-2006, 03:04 PM

I would definately advise you to get into some mutual funds. It is a good way to get into the stock market and let the company do the stock picking for you. I don't know if you can have a roth IRA but that would be something you should look into. Defiantly subscribe to a magazine like Money, it will give you lots of advice over mutual funds.

PRICEPLUS · #6 (**permalink**) 03-06-2006, 03:32 PM

Congratulations! Next stop emergency fund and then the wonderful world of investing. You need to do your homework and also determine what typpe of investor you are. Remember that if something sounds too good to be true it probably is too good to be true. Again good luck and congrats!

billybob · #7 (**permalink**) 03-06-2006, 04:22 PM

well, it will probably take me a year or 2 just to build up an adequate emergency fund. That should give me plenty of time to read up on investing.

Another question- say I build up an emergency fund of 15K (6 months of living). Do I need to then save my downpayment amount ON TOP of that 15K? In other words, I should not dip into the emergency fund for the downpayment? That would set back my house-owning plan at least a year. Thoughts?

CJsoccerchic · #8 (**permalink**) 03-06-2006, 06:36 PM

Start looking for a house - it'll take you a while to find the one that you'll like and be able to afford. Meanwhile - if you can, start saving like a maniac - my friend who bought a house recently lived off ramen and rice for 3 months just to save as much as she could, then when the house was finalzed, she came back to the world of eating right.. So cut back on the unnessities, save like a maniac, and start browing the net and maybe get a realtor. That's what I'd do.. I'm so far away from buying a house though.. I think I'm too young...

Firefly · #9 (**permalink**) 03-06-2006, 08:47 PM

It is wonderful to be CC debt free.

Firefly · #10 (**permalink**) 03-06-2006, 08:51 PM

I would start looking at mutual funds and a retirement account.