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    #16
    I like your plan, but one thing I would suggest:

    In addition to the 5% to the 401k, open a RothIRA and put in the max...if you do this until you are 30 and stop, you will be at a HUGE advantage! I am 27 now and just maxed for the first time in 2011. I REALLY wish I had started earlier...and even with the crazy stock market, the time to buy is when it's down...and then sit on it for another 40 years.

    So here's what you should do, I think:

    5% to 401k (it's not really 5% of your pay, since it's pretax, yay!)
    $400 a month to Roth (this will almost max it out, add $200 more in Dec)
    3 months in EF (whatever that is for you, expenses only, bare bones)
    Pay off SL
    3 more months EF (so 6 total)
    bump up 401k to 10%, keep going on the Roth
    save for your house

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      #17
      I wouldn't pass up free money (employer match) so I like your plan.

      I'd ease up on your no-mortgage philosophy, though, personally :-) There's nothing terribly wrong about a reasonable and appropriate mortgage. But to each his own, of course!

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        #18
        Originally posted by artwest
        Get that paid off THEN start funding the 401k.
        If the debt were credit card, most of us would probably agree. However, employer-match combined with compound interest on a 401(k) would be foolish to pass up. Most people don't understand the concept of how that compound interest really builds wealth.



        The more closely you stick to Dave's plan, the more successful you will be.
        I'd never even heard of Dave Ramsey until I watched the documentary film Maxed Out, and it looks like he has done a great job of climbing out of debt and becoming financially wealthy. However, he isn't a god, and although his plan, whatever it is, may be good for several people, it shouldn't be viewed as the only way to build wealth. As with most ideas in life, you listen, apply what is useful to your life, and ultimately make your own decisions.

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          #19
          How long have you had your student loan for? And how old are you. I presume you are quite far away from retirement age and therefore being prudent about saving for the future, very sound plan. The student debt is quite minor, seeing it is your only debt you plan to have. I think your current plan is good but if you are unsure visit a financial advisor and they will give you all you need to know.

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            #20
            I would personally pay off the student loans as quickly as possible. This is what I am doing. I will not take out any personal loans or debt for the rest of my life, after the horrible, lingering experience of trying to pay off student loan debt. Unfortunately, for most people who are married, if one spouse wants to get a house and take out a mortgage, you don't have an option of paying 100% for a house...if you are single, maybe you can decide! Lol.

            I do not know anyone, wealthy or not, who paid for their house in full. And I have friends of the family who are millionaires, and they did not even put down that much. We put down around 20%, and actually I think it was slightly over that. It was a tremendous sacrifice even for that much, and wiped out our savings over the past year, but at least we could put down that much. I think if you were able to put down even 50%, you might really feel it hurt your general living budget for at least that first year after buying. We bought our first house ten months ago, and we have still not recovered financially, and it will take years to build up our savings again to anywhere near what we had when renting. That being said, it was something we had to do, because rent was higher than a house payment and going up a LOT.

            If you make enough to put 100% down on a house, more power to you! Don't think we will ever be able to, or most of our friends/family...

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              #21
              Debt free by 27? Good for you! Itís awesome to see young people who have their finances sorted, and live beyond the typical moment to moment, instant gratification trend.

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                #22
                Just a quick up date: I've built up my emergency fund to $2,000, am setting money aside for retirement, have Christmas money saved, and am now planning in my budget to put a bit towards my loans too. I'm attacking multiple things at the same time. At the rate I am moving, I will be debt free by 27, have a fully funded emergency fund, and a healthy retirment savings. Let the good times roll!
                Check out my new website at www.payczech.com !

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