New here, looking for savings advice

[Hot dog]

I also wanted to say don't stop the overtime just cause it isn't necessary now. Put all overtime into an emergency fund and then start on those bills. It will make the process much faster. Also read Dave Ramsey's book The Total Money Makeover.

[geojen]

Originally Posted by maat55

If you read many of these threads and the advice given, you will notice that there is a few basic fundimentals:

low debt load.
Having an EF.
Investing 10% or more.

If you follow these basic fundamentals, you will be prepaired for emergencies and retirement. Good luck.

Not the hijack the thread, but I have a question. Should people be saving 10% of their total income or each income. For example, I and DH each put 5% of our pay into our 401Ks at work. Does this equal the 10% rule for investing? Or do each of us need to do this for it to count as 10%. I realize that we should both count on doing the 10% or more eventually, but right now we are still working our snowball.

[jimstolz76]

Originally Posted by Hot dog

I also wanted to say don't stop the overtime just cause it isn't necessary now. Put all overtime into an emergency fund and then start on those bills. It will make the process much faster. Also read Dave Ramsey's book The Total Money Makeover.

The overtime isn't really up to me... supposedly we are at only 40 hour weeks, but I still sneak at least a few hours in there - as much as I can. I also still do some contracting work outside of my day job, but I'm trying to get away from that as it just takes too much time & effort away from the family. (unless I'm making like $500 for a morning's work......)

I also still have my wife's income, which isn't much, but she has GREAT benefits at her job. We switched from the family benefits at my job to just individual for me (which is covered 100% by the company) and put her and her daughter on her benefits for about half what we were paying... and we have much, much better coverage for them than we did before.

So, the 10% of my net income isn't 10% of our total income. Once we get used to this, I'm going to shoot for more than 10% of our total. We can definitely live on it if we just get serious about our finances.

[ea1776]

Originally Posted by geojen

Not the hijack the thread, but I have a question. Should people be saving 10% of their total income or each income. For example, I and DH each put 5% of our pay into our 401Ks at work. Does this equal the 10% rule for investing? Or do each of us need to do this for it to count as 10%. I realize that we should both count on doing the 10% or more eventually, but right now we are still working our snowball.

IMO, you should take the total combined gross income between you and your DH, then multiply by 0.1 (10%). This will give you your savings target for 10% (note that I recommend saving more than that, but that's the concept anyway).

[jIM_Ohio]

Originally Posted by geojen

Not the hijack the thread, but I have a question. Should people be saving 10% of their total income or each income. For example, I and DH each put 5% of our pay into our 401Ks at work. Does this equal the 10% rule for investing? Or do each of us need to do this for it to count as 10%. I realize that we should both count on doing the 10% or more eventually, but right now we are still working our snowball.

5% of x+5% of y=5% (x+y). You are only saving 5% of your income.

10% is a good foundation, I think most planners these days suggest 15% (which could include match). T Rowe Price recomends 15% from all sources be set aside for retirement.

[ea1776]

Removed.

[toptaxguy]

I wouldn't put the long term savings in an ING or any savings account. You'd be better off investing in equity mutual funds or stocks.