Ok Here is my Budget.

[Savingmommyof3]

I guess, I need help!! . My husband brings home 5817.00 a month.. getting ready to be 5950 when he gets his raise next month, and then he will be deploying, I wont count that income, because it will be allotted out

Mortgage 1048.00
Car Payemnt 608.00
Car&insurance and life insurance 120.00
DPP(credit Car) 240.00 balance 5500
Usaa 25.00 a month balance 2000.00
Chase 35.00 balance 1500.00
Water bill, 35.00
Grocery 400.00
electric 180.00
Tithes 580.00
family Gym 52.00
gas 200 a month for husband for work

2789.00

husband is getting ready to deploy, Im a stay at home mom, I dont use much gas and less I go shopping in which i do alot of, I am trying to cut back and save more, we recently just started putting the 300 a month, We have a decent amount in a couple of CDS.. I suppose.

[disneysteve]

I guess, I need help!! . My husband brings home 5817.00 a month.. getting ready to be 5950 when he gets his raise next month, and then he will be deploying, I wont count that income, because it will be allotted out

Mortgage 1048.00
Car Payemnt 608.00
Car&insurance and life insurance 120.00
DPP(credit Car) 240.00 balance 5500
Usaa 25.00 a month balance 2000.00
Chase 35.00 balance 1500.00
Water bill, 35.00
Grocery 400.00
electric 180.00
Tithes 580.00
family Gym 52.00
gas 200 a month for husband for work

Your expenses total $3,493 which is $2,324 less than your income. That's great! What exactly are you looking for help with?

Given that surplus, I'd love to see you guys knock out some of the debt before he deploys. In about 4 months, you could pay off the DPP, USAA and Chase bills and be debt-free except the mortgage which would decrease your monthly expenses by $310. Of course, you also want to make sure you have a nice big emergency fund in place.

[Savingmommyof3]

Is there any particular type of account we should be putting this money into, we have over 20,000 in a a couple of CDs which dont really draw much interest, and I was just planning to try to put money away in a regular savings account.My husband leaves in about 3 months, im just going to start paying off these credit cards, and cut my shopping habit out,, I had all the credit cards paid off except dpp back in January,

[snafu]

Interest rates are very low at present so [in my opinion] there are no 'savings' vehicles that are currently keeping up with inflation. There is danger in long term Bond funds which react inversely to interest rates by going down in value when interest rates increase.

Investments, even CDs come with a level of risk and you need to decide your 'sleep at night' factor before seeking any investment. Your plan to pay off CC debt is right-on! Keep telling us about your successes and we'll cheer you on!

[Savingmommyof3]

whoaaaaa CDs have risks? That I didn't know. Please tell me about this

[jpg7n16]

Car Payemnt 608.00
DPP(credit Car) 240.00 balance 5500
Usaa 25.00 a month balance 2000.00
Chase 35.00 balance 1500.00

we have over 20,000 in a a couple of CDs which dont really draw much interest

What other assets do you have? Savings account? Checking account? TSP/457 plan? IRAs?

How much is the car worth? How much do you still owe? At what interest rate?

How much life coverage do you have on him?


Depending on what you have in the checking/savings account, I would consider closing out the CDs, paying any fee to do so, and paying it all towards debts (CCs, and car balance). You likely aren't making anything really on the CD, and you're paying a LOT on CC interest. I don't think the fees are that high to close them early, maybe a couple percent. But you could easily save double-digit interest rates on your CC debts.

I would like to see you guys keep like $10k in cash (about 3 months expenses) and pay off the debts. Then when they're gone, I'd build the EF up to 6 months expenses (approx $20k).


Are you doing any retirement savings? Have you done any retirement planning?

And mother of 3 means likely some college for the kiddos on the horizon. Is helping them through college a goal of yours?

[disneysteve]

whoaaaaa CDs have risks? That I didn't know. Please tell me about this

Everything has risks. There is liquidity risk - Can you get to the money when you need to? There is principal risk - Could your investment lose money? There is inflation risk - Will your investment earn enough to keep up with inflation? There is interest rate risk - If interest rates rise, will that affect your investment?

For CDs, you have inflation risk since the inflation rate is higher than the return on the investment. If your CD earns 1.5% and inflation is 3%, you are really losing 1.5%/year in buying power.

You also have liquidity risk. If you cash out earlier, you will pay a penalty of several months worth of interest (although I think Ally Bank has a no-penalty CD).

You also have interest rate risk. If you buy a 2 year CD but 6 months from now, the interest rates are higher than today, your money is stuck in the lower-yielding CD until the term is up.

[kork13]

Just to chime in quickly... If you have the opportunity to do so, I would strongly recommend using the Savings Deposit Plan (SDP) if his deployed location is eligible for it (combat zone). You can save up to $10k in it, and earn 10% interest on the money for as long as he's deployed (plus 3 months after he comes back). Even if it takes you a few months to max it out, the interest there is significant, especially if it's a 6-month or longer deployment.

Take care.

[NuggetBrain]

Just to chime in quickly... If you have the opportunity to do so, I would strongly recommend using the Savings Deposit Plan (SDP) if his deployed location is eligible for it (combat zone). You can save up to $10k in it, and earn 10% interest on the money for as long as he's deployed (plus 3 months after he comes back). Even if it takes you a few months to max it out, the interest there is significant, especially if it's a 6-month or longer deployment.

Take care.

Was just going to suggest that. Fantastic idea.

[Savingmommyof3]

we have about 25000 in cds and 1000 in a reg saving account, I have over 800,000 of life insurance on my husband, I guess I should take out 5000 and pay off the dpp that would give us and xtra 200 a month to stash away. My husband is going use Gi bill for the kids, well one of them,, We plan to help them out a little bit we hope,, I just want to save save save,

[JoeP]

I'd pay off as much non-mortgage debt as possible: cars, credit cards, etc. Then put aside some money into an emergency fund (3-6 months of expenses), which it sounds like you may already have.

I'd also look into a financial adviser who can help guide you so that you never have to get a car loan, or use credit cards.

[jpg7n16]

we have about 25000 in cds and 1000 in a reg saving account, I have over 800,000 of life insurance on my husband, I guess I should take out 5000 and pay off the dpp that would give us and xtra 200 a month to stash away. My husband is going use Gi bill for the kids, well one of them,, We plan to help them out a little bit we hope,, I just want to save save save,

In that case, I would likely cash out $15k from the CD (if they make you do it all, just do it all). Pay off all the CC debts, and use any remaining funds (of the $15k) to pay down car loan.

I'm not concerned about the monthly cashflow as much as that you are happily keeping balances on cards that charge you double-digit interest rates, when you have the money in the bank to pay them off, and it's earning maybe 3% max. And that's a stretch these days.


What is the situation around your car payment?