how am i doing, what should i be doin

[rbusch]

I'm 31 wife is 29 we bring in a combined 75 k yearly, we have 20k in savings, 15k in a cd, 30k in an espp plan, 2 k cash in my etrade,. I have an ESOP account currently at 40k and 7k in a 401k (company does not match but funds the ESOP 100% free) wife has a pension fund as she's a teacher(not sure on that amount). We have no debt, own two 2012 low mile vehicles (paid cash) and currently rent a house. We are interested buying (that's why we haven't locked up our savings) but really want to build. Either way were in no hury to leave our rental. currently we spend ball park 2k monthly rent, daycare, utilities. This is spending her check and saving mine each month. How are we doing and what could we be doing better. Thanks

[LivingAlmostLarge]

It's great you are living off 1 income. Nice work. Nothing else to say except good luck!

[snafu]

Since there is such variation in housing costs in different regions, I wonder if you would outline differences in housing values from December 2013 to current costs. How large a lot? How large a house {square footage}? In my view, it's important to have a 20% downpayment because of the high cost of mortgage insurance. It's important to review the details of any mortgage as some require the purchasers to retain PMI for the entire term of the mortgage.

How much of a mortgage do you feel comfortable carrying? What interest rate are you tracking at various lender categories?

Does your background include knowledge of the various segments helpful in the stressful undertaking of having a custom home built?

Since you asked...
I would be uncomfortable with the imbalance of a retirement plan $ 40K @ ESOP, $7K @ 401K. I presume you have considerable contribution space which also gives you a larger income tax rebate. This is important in the early years of employment because retirement sums benefit significantly from compounding over time.

I suggest you track DW's pension plan on Excel or program of choice, noting contributions which are deducted from pay and it's annual value.

[Fishindude77]

You are miles ahead of most folks your age.
Keep up the good work.

[Jluke]

we have 20k in savings, 15k in a cd, 30k in an espp plan, 2 k cash in my etrade,.

You're doing well; esp living off of one pay check and banking yours.

suggestions: what rate are you getting on the savings? the cd(s)? Hopefully you at least have a Capital One Account where you can get 0.75%. I'm sure other people know of higher earning accounts that they could suggest.

Owning a home really comes down to math and understanding the amortization schedule of the mortgage.

since you are not in a hurry, play around with an amortization schedule - mainly looking at the differences between a 30-year, 20-year and 15-year mortgage. Figure out where your comfort level is with interest amounts and debt duration.

Educate yourself on Dollar Cost Averaging (DCA) investing.

You may also want to open a ROTH IRA for DCA investing - now really is the time to save as much as you can for retirement.

Finding the right balance with debt, expenses (short/long term), EF savings, and retirement savings should be your goal.

[rbusch]

We would at 100k in savings but over the last 2 years we have bought 2 low mileage vehicles, wife had her last car for 6 years with over 150k miles I had my previous vehicle for 10 years at around 140 k miles. Wife drives 90 miles daily so a reliable vehicle for her was necessary, my vehicle was needing some work and well I was wanting something different. I guest I'm saying were expecting to be major expense free for multiple years

As far as a home. If we would build were expecting ground to run 15 to 30 k and a home with basement 1600 to 1700 sq Ft I'm looking 200k plus price of ground

If we would buy we would likely be looking at a home with considerable mat of remodel. Purchase in the 120 to 140s


We are prepared for the stress and decisions building a home brings

I'm guessing if we could save another 40k over the next 2 years. Bring savings to 60k and see my espp plan at 40k keeping the 15k cd as an large emergency fund then we will be in good shape?

[snafu]

For figures offered I'd suggest $ 50K which includes downpayment and 1% for unexpected costs, appliances and window coverings. Wife's employment is more stable than many so if you likewise have better than average employment stability, 6 months of your basic living expenses is a reasonable EF.

Jluke's suggestion to review amotorization tables is terrific. It helps you fully understand how monthly payments allocate to interest and principal as well as the difference a few points on interest matter.

As a first time buyer, you're exceptionally brave to seek a custom build.