Debt Dumpers 2022

[Cynt]

@Cynt, do you have a company match on either program? If so, I’d go for that one.

Also, for anyone trying to eat healthier, I was introduced to Whole 30 last year by my niece and highly recommend it. Its challenging, but for me, it is a great way to reset my eating habits. I‘ve restarted the program this week after getting off track over the holidays the past couple of months.

Yes, I have company match at 6%. I have been doing that for years.

 

[barkley]

Priced out the cost of replacing our windows, as well as part of our siding (masonite) and repainting the house. Extra $ will be split between goal 1 and this.

remember to research any rebates your local utility company offers on windows as well as potential tax credits for energy efficient windows.

 

[ruadisneyfan2]

@Cynt
I beleive the general advice is to max out your 401k before investing in a Roth IRA. The 401k lowers your taxable income.
YMMV.

 

[barkley]

got notified by our insurance company that they've implemented some kind of program this year that provides each of us with $50 per quarter/use it or lose it up to $200 per year in funds to purchase otc drugs and other items from some company online. i looked it over and found all of the stuff we tend to get so i'm glad i did'nt stock up the last time i went to costco. i'm doubtful the stuff we use totals our household's eligibility to $600 per year but i'm going to clue my oldest in and explain that if i'm provided with a list of otc meds i'll bundle it in when i order so it can save both households some $$$.

 

[princesscinderella]

Yes, I have company match at 6%. I have been doing that for years.

You should do the 6% to the 401(k) to get the company match and then max out the Roth IRAs, first before contributing more to the 401(k). Roth’s have much more flexibility if you need to withdraw early and there’s no guarantee that tax rates will be lower in retirement so it good to have a balance of both a Roth and 401(k). Never leave corporate match on the table, so always contribute enough to get the max match it’s free money!

 

[dina444444]

@Cynt
I beleive the general advice is to max out your 401k before investing in a Roth IRA. The 401k lowers your taxable income.
YMMV.

The going advice I’ve been seeing lately is to contribute to your match for the 401(k), then contribute the full amount to a Roth Ira, and then if you have extra that you can contribute then go back to the 401(k) and contribute up to the max.

 

[slightly_obsessed]

remember to research any rebates your local utility company offers on windows as well as potential tax credits for energy efficient windows.

Thank you for the reminder! I haven’t researched either yet.

 

[ruadisneyfan2]

Well, do what you feel comfortable with, but after my elderly father started needing help managing his bills and doing his taxes, I was really surprised to see how small his taxable income is now. He did very well while working but now while retired, his needs are small, despite paying property taxes on 2 single homes in NJ. His annual income is now <$40k/year. $20k goes to property taxes. Earlier in his retirement, when my mom was alive, they withdrew more for travel for the first 8-9 years after they first retired, but now that he has slowed down, he doesn't need much. That amount would probably be higher if my mom was still alive (more food, water, medical copays) but then again she would be collecting Social Security too.
I will still vote for maxing out our 403Bs to help lower our taxable income now, while dh and I are both at the top end of income for our careers.

What to Do After Maxing out Your 401(k) Plan (investopedia.com)

 

[jen7233]

I max out our Roth IRAs, but haven't been paying good attention to the 401k type plan. I'm only doing 5% in my TSP, if I stick around in the same job field I have about 10 years I can contribute to. DH is not invested in one he could have done (TSP) but he's retiring in under two years so he's not opening one at this point. Consequently, do to our choices over the years with saving, we have a huge non-retirement taxable account invested compared to our retirement accounts. I think we did a fairly good job with our Roths over the years, I ran some numbers and there were years we didn't max, I think overall it was about 50k shy of potential investments we could have put in the Roths from the point we started.

 

[potterfanatic]

I’ve been doing debt dumpers with you guys for a couple years now. I don’t say too much but I try to keep up reading along. But today was a VERY big day here. My husbands law school loans were forgiven for reaching 120 payments on the public service loan forgiveness program.

 

[disney-inspired]

I’ve been doing debt dumpers with you guys for a couple years now. I don’t say too much but I try to keep up reading along. But today was a VERY big day here. My husbands law school loans were forgiven for reaching 120 payments on the public service loan forgiveness program.

That is awesome! Does it feel like a huge weight lifted?

 

[DisneyMandC]

I’ve been doing debt dumpers with you guys for a couple years now. I don’t say too much but I try to keep up reading along. But today was a VERY big day here. My husbands law school loans were forgiven for reaching 120 payments on the public service loan forgiveness program.

Congratulations!! I'm 40 payments away

 

[potterfanatic]

That is awesome! Does it feel like a huge weight lifted?

Yes! I even cried I was so happy. He hit the 120 payments but they said he only had 55 because the automatic deposit was 1 penny shy of being a full payment. It’s been a long road.

 

[ruadisneyfan2]

Yes! I even cried I was so happy. He hit the 120 payments but they said he only had 55 because the automatic deposit was 1 penny shy of being a full payment. It’s been a long road.

Sheesh, that's awful. And the world wonders why Americans don't trust the government.

 

[slightly_obsessed]

I’ve been doing debt dumpers with you guys for a couple years now. I don’t say too much but I try to keep up reading along. But today was a VERY big day here. My husbands law school loans were forgiven for reaching 120 payments on the public service loan forgiveness program.

Congratulations!! Such a huge deal!

 

[nat8199]

You should do the 6% to t
he 401(k) to get the company match and then max out the Roth IRAs, first before contributing more to the 401(k). Roth’s have much more flexibility if you need to withdraw early and there’s no guarantee that tax rates will be lower in retirement so it good to have a balance of both a Roth and 401(k). Never leave corporate match on the table, so always contribute enough to get the max match it’s free money!

This depends entirely on what tax bracket you are in and what tax bracket you are likely to be in in the future. We are currently in a higher tax bracket than we will be in when we retire, so we max 401k and HSA before going to ROTH.

 

[princesscinderella]

This depends entirely on what tax bracket you are in and what tax bracket you are likely to be in in the future. We are currently in a higher tax bracket than we will be in when we retire, so we max 401k and HSA before going to ROTH.

Correct but if you are in a high enough bracket then you aren’t even eligible for a Roth and would need to do a taxed IRA contribution (since you would be over the deductible limit here too) and then do a Roth conversion. If you do need to do it as a Roth conversion it’s best to do two years at once between Jan-April when you can contribute to the past year and current year before filing taxes. Contribute to the taxed traditional IRA and then immediately have it converted to the Roth so there’s no gain on the money and therefore no tax consequences. You need to contribute it all in a lump sum so you could set up a savings account to contribute monthly if needed until you get to the contribution limit. A financial advisor can help set this up.

 

[Woth2982]

Hello all! Long time lurker, first time poster! I followed the entire 2021 thread and am ready to tackle some goals in 2022.

Goals:
Pay off Amazon Credit Card ~$7k
Pay off personal loan ~$2K
Pay off final Student loan ~$4K
Pay off medical debt (to be incurred in March) ~$6k
Save about $2k for Disney Spending money for October

We put our propane deliveries on the Amazon card, and well cost of everything is up, so that card got a little out of control. I have been dragging my feet on the other two because the interest rates and payments are low, but I am kinda tired of paying for them.

I am due with baby number 2 (and final) in March, and the out of pocket max is $6,000 on my insurance policy. The delivery/hospital stay will max that out. My husband is planning on getting a vasectomy after the baby is born, so I said make any and ALL medical appointments you can between now and the end of 2022 because they will all be covered with no additional out of pocket expense. I thankfully get a great maternity leave with my company, 2 weeks per-partum 100% pay, 16 weeks maternity leave 100% pay, and 4 weeks at $850/week. So I am trying to build up my savings to cover the difference between my salary and the $850. I am almost there and should be fine by the time I leave work.

We are going to Disney in October with some friends, we have about $2k in Disney gift cards already, but I would like to save another $2k as this year I will be able to drink around the world. Last visit in November I could not do so!

 

[pblack]

Hello all! Long time lurker, first time poster! I followed the entire 2021 thread and am ready to tackle some goals in 2022.

Goals:
Pay off Amazon Credit Card ~$7k
Pay off personal loan ~$2K
Pay off final Student loan ~$4K
Pay off medical debt (to be incurred in March) ~$6k
Save about $2k for Disney Spending money for October

We put our propane deliveries on the Amazon card, and well cost of everything is up, so that card got a little out of control. I have been dragging my feet on the other two because the interest rates and payments are low, but I am kinda tired of paying for them.

I am due with baby number 2 (and final) in March, and the out of pocket max is $6,000 on my insurance policy. The delivery/hospital stay will max that out. My husband is planning on getting a vasectomy after the baby is born, so I said make any and ALL medical appointments you can between now and the end of 2022 because they will all be covered with no additional out of pocket expense. I thankfully get a great maternity leave with my company, 2 weeks per-partum 100% pay, 16 weeks maternity leave 100% pay, and 4 weeks at $850/week. So I am trying to build up my savings to cover the difference between my salary and the $850. I am almost there and should be fine by the time I leave work.

We are going to Disney in October with some friends, we have about $2k in Disney gift cards already, but I would like to save another $2k as this year I will be able to drink around the world. Last visit in November I could not do so!

and congratulations on baby #2!

 

[EilonwyWanderer]

Been a long time since I posted in this thread and a lot of things have changed (for the better!) but that darn credit card is still hanging over my head so:

Goals:
-Pay down the one credit card we have that right now is hovering around 14k. We paid off a disturbingly large amount on it last year, however since we were in a new house a LOT of those were just expenses fixing and furnishing things but this year we should get it down and keep it down.
-Stick to a budget. I've started using YNAB and while I think the learning curve is steep, I clearly need something that can show me where the money goes!
-Actually use the things we've bought like the exercise bike that's been sitting downstairs forever.
-Eat out less. An embarrassing amount of our debt is due to eating out.

Does anyone have any recommendations on saving for college? I am hesitant to start up one of those...are they 529s? I'm nervous about contributing to something that will ONLY allow them to pull the money for college if they eventually decide (oh please no) not to go, etc.