Making advanced payment towards debt payoff (or invest instead?)

[doxie]

I'm not trying to make waves, but I think a couple who makes $245K a year can afford to spend $500 a month on groceries and eating out. I'm not sure why spending money on food is so frowned upon in this forum.

I understand if someone is deep in debts and/or low on income that they need to trim the expenses down as much as possible, and doesn't need to be eating out and shopping at Whole Foods. In this case, the OP makes plenty of money, has a reasonable debt to income ratio, and can afford to pay off the debt in a reasonable amount of time. There's nothing wrong with enjoying a nice meal every now and again. For me, it's kind of a hobby.

Sorry to stray off topic, I guess I needed to get that off my chest

[disneysteve]

I'm not trying to make waves, but I think a couple who makes $245K a year can afford to spend $500 a month on groceries and eating out. I'm not sure why spending money on food is so frowned upon in this forum.

doxie, I'd tend to agree with you if they were debt-free except their mortgage, but they aren't. They have $86,000 in debt. From what has been said, it also appears that they are not yet saving 15% for retirement and do not have a fully funded emergency fund in place.

I've got no problem at all with people who love to cook and love to dine out. My wife and I are very much like that. We spent $70 for dinner out with friends last Sunday nite and we are meeting people for brunch next Sunday morning that will run us about $40. And that doesn't count any dining out we do on our own as a family (went out for pizza Wednesday night for about $20). The difference is that we are debt-free except for a very modest mortgage and we are saving/investing upwards of 25% of our gross income.

When we were just starting out and I had 102K in student loans and we were both paying off our cars, we live much more frugally, cooked most meals at home from scratch, did a lot of comparison shopping and directed our efforts at paying down debt. I'm just suggesting that OP and his wife do the same. Make getting out of debt and building an EF priorities above going out for nice meals. The nice meals can come later when the debt is gone.

[Eric80]

I think that debt is such a burden so if you can then maybe consider doing this - or even maybe consider consolidating your debts to make it more manageable for you and then you will have spare cash to invest or do whatever you wish with.

[charlieh]

In this economy being liquid is a huge asset. So while it is nice to pay off most of your debts at least 6 months of an emergency fund but more reasonably a year would be smart. Fortunately you are diversified just by having both you and your wife with substantial income streams, so a move to pay down your debt should be both possible and smart. Just remember though that in this economy borrowing becomes near impossible without income streams, and many people in similar situations to yours have now lost their income streams, and been unable to tap whatever equity they have built up because of borrowing restraints. That's why while it is nice to have everything paid off, when it comes down to it access to cash can be equally as or even more important.