How does one get credit?

[Jewish Rabbi]

Originally Posted by The God Hypothesis

My base is just under $200k with some bonus potential.

My debt consists of wives daily driver which is 18 months from payoff, but at 0% why pay early? I also owe about $200K on my house that has a 30 year mortgage at 3%, and has about $100K of equity.

Credit rating is around 800, I use my Chase to buy everything and reap the rewards at the end of the year in cash back, but I guarantee the wife and I spend money we wouldn't otherwise if cash based. I pay it off in full; every month without fail.

My question to the CP gurus is what to do next, pay off the 0% car just to get it over with, start paying off the mortgage, or start heavy investing in IRA's, mutual funds, etc...

My 401K is low six figures, have about $60K in stocks, and $75K in my online checking/money-market account.

I'm mid 30's, so I obviously need to get my retirement rolling, but I am at a total loss what to do next due to my low cost of money borrowed. Start heavy debt elimination, or heavy investing? The money in the bank is just losing value, although inflation is non-existent and the feds are taking steps to avoid deflation I hear.

It's a personal preference. With your mortgage rate right at inflation, I wouldn't feel like you need to pay that off. Same goes with the car, no need to pay it off early. Some people just don't feel comfortable holding debt, however.

I would make sure your company match is met in 401(k), then max out a Roth IRA for both you and your wife, max out your 401(k), then put whatever remaining in index funds, in that order.

[Kidd Lex]

Originally Posted by Jewish Rabbi

It's a personal preference. With your mortgage rate right at inflation, I wouldn't feel like you need to pay that off. Same goes with the car, no need to pay it off early. Some people just don't feel comfortable holding debt, however.

I would make sure your company match is met in 401(k), then max out a Roth IRA for both you and your wife, max out your 401(k), then put whatever remaining in index funds, in that order.

Can you do Roth catch up all at once? Also would you suggest hiring a financial adviser, or use a site like Vanguard and do all this yourself. I read on these topics all the time but at the end of the day I get total paralysis by analysis, so I turn to CP, where everyone has their financial phd's.

[lewdog]

Originally Posted by The God Hypothesis

Can you do Roth catch up all at once? Also would you suggest hiring a financial adviser, or use a site like Vanguard and do all this yourself. I read on these topics all the time but at the end of the day I get total paralysis by analysis, so I turn to CP, where everyone has their financial phd's.

Originally Posted by Jewish Rabbi

It's a personal preference. With your mortgage rate right at inflation, I wouldn't feel like you need to pay that off. Same goes with the car, no need to pay it off early. Some people just don't feel comfortable holding debt, however.

I would make sure your company match is met in 401(k), then max out a Roth IRA for both you and your wife, max out your 401(k), then put whatever remaining in index funds, in that order.

I agree with all of this as well. You make quite a bit of money so no reason you shouldn't be maxing our your 401k and contribuiting the max to your Roth but if you can't do both, make sure you contribute enough to your 401k to get the highest match from your company as you can. Then contribute rest of money earmarked for retirement into a Roth. Calculate what you think you'll need in retirement per month, how long you might live in retirement and determine if you savings amount will meet your needs. There are many online calculators to help you with this.

If you feel like you are going to be into mostly low cost mutual funds or ETFs with investing, I'd just manage that yourself and re-balance maybe twice a year to keep within whatever risk you are comfortable with. If you plan to mix in quite a bit of individual stocks or make quite a bit of moves, a financial planner might be an option but I'm not sold that they get you ahead since you have to pay them a percentage of what you are making. If you plan to work quite a bit longer I'd manage much of that myself and get a financial planner later is your feel uncomfortable with how large your assets become over time.

[lewdog]

Originally Posted by The God Hypothesis

Can you do Roth catch up all at once? Also would you suggest hiring a financial adviser, or use a site like Vanguard and do all this yourself. I read on these topics all the time but at the end of the day I get total paralysis by analysis, so I turn to CP, where everyone has their financial phd's.

Sorry missed this but no, only 1k extra per year into Roth as catch up and must be put in before the due date of your tax return.