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

[littleroc02us]

Check out Vangaurd's mutual funds. It usually takes around $3k to start a fund, then setup auto withdrawls from your checking account to max out 5k each year.

[snshijuptr]

You might want to first establish an emergency fund so you don't end up in debt again of 3-6 months of expenses. Then start the Roth IRA.

[watsoninc]

Since you have freed up some of your cash flow with the elimination of your debt, are you able to bump up savings a little bit so that you can hit the EF goal quicker?

[bjl584]

You might want to first establish an emergency fund so you don't end up in debt again of 3-6 months of expenses. Then start the Roth IRA.

I second this. Build up an EF BEFORE opening up an IRA. You should strive to save up 6 months worth of living expenses in cash as your first financial goal.

[littleroc02us]

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

EF fund is important, get 3-6 months worth and then look at Vanguard funds.

[knockknoc]

I appreciate everyone's advice. Thank you.

How long do you think it should take me to reach my 3 to 6 month EF?

[Robert742]

I appreciate everyone's advice. Thank you.

How long do you think it should take me to reach my 3 to 6 month EF?

It depends on how much your monthly expenses are. An EF should be 3 to 6 months of your monthly expenses. If your income or employment varies or is unstable, you may want to have 12 months of expenses.

I recommend reviewing your budget to see if you can increase your savings rate.

[littleroc02us]

I appreciate everyone's advice. Thank you.

How long do you think it should take me to reach my 3 to 6 month EF?

Shouldn't take very long at all if you've already paid off your debt.

[wonderfulpittance]

I appreciate everyone's advice. Thank you.

How long do you think it should take me to reach my 3 to 6 month EF?

It depends on your spending. I suggest look at your lifestyle right now and see where you can cut some expenses. Live below your means FOR NOW until you reach 6 months of EF. Aggressively build up that EF. Why am I suggesting that you AGGRESSIVELY build it up? Because it requires you to trim down your spending. If you've done this (trimming expenses) while building up your EF, you'll realize that you can really live frugally. Once you've built up your EF, you've already adjusted your life to being frugal. It's hitting two birds with one stone.

Good luck.

[Demetrius]

I am happy for you that at last you have paid your debt and it really a freedom and the feelings is is very relieved person.And now you are even able to save....thats better sign...i have been also indebted to debt fews years back and it has been a very bad period of my life.

[knockknoc]

Thanks again, everyone. This is helpful. And, yes, it is an amazing feeling of relief to be out of debt and able to save.