Monthly budget

[Nick87]

Bumpkng this thread. So I admit it took me like 3 years and getting a new/better job. We have been saving more and contributing to retirement since this threwd more But we are truly budgeting now. (literally just our first month or so) and its has been eye opening. One question for all the people saying don't ever have a vehichle loan. Can I challenge that? We only have one vehichle payment and I could technically pay it off tomorrow if I wanted. But with the interest rate on the loan being the same as the rate I get on that money in a cd. Why would I want to not have that liquid available to me especially in a line of work that is more volatile than most? Just seems safer to me to have that money at my disposal instead of paying it off and slashing that cushion down until I get it built back up, but I admit I could totally be missing something....

 

[Jbotto]

Bumpkng this thread. So I admit it took me like 3 years and getting a new/better job. We have been saving more and contributing to retirement since this threwd more But we are truly budgeting now. (literally just our first month or so) and its has been eye opening. One question for all the people saying don't ever have a vehichle loan. Can I challenge that? We only have one vehichle payment and I could technically pay it off tomorrow if I wanted. But with the interest rate on the loan being the same as the rate I get on that money in a cd. Why would I want to not have that liquid available to me especially in a line of work that is more volatile than most? Just seems safer to me to have that money at my disposal instead of paying it off and slashing that cushion down until I get it built back up, but I admit I could totally be missing something....

Not going back 9 pages to reread everything. As long as you have an emergency fund to cover the volatility from your job, I’d pay it off. But make payments until that emergency fund is there for you guys. That emergency fund number seems a lot higher for our wives than it does for us guys, just something I’ve learned.

 

[Nick87]

Not going back 9 pages to reread everything. As long as you have an emergency fund to cover the volatility from your job, I’d pay it off. But make payments until that emergency fund is there for you guys. That emergency fund number seems a lot higher for our wives than it does for us guys, just something I’ve learned.

I get that but if im making it in a cd or other account I dont understand the value in paying it off. Having that accessible is like an extension on the emergency fund imo. I dont see how paying that off gives me an edge really unless rates dropped to where the cd was less?

 

[Redmt]

I'll just guess that today's payoff number is much less than letting it run full term. I'll also guess that the CD interest accumulation is less than the total full term payoff. I'd check my math again.

 

[Nick87]

I'll just guess that today's payoff number is much less than letting it run full term. I'll also guess that the CD interest accumulation is less than the total full term payoff. I'd check my math again.

I thought it would be the opposite because I'm rolling the interest from each cd back into it creating more compounding interest?

 

[SAJ-99]

I get that but if im making it in a cd or other account I dont understand the value in paying it off. Having that accessible is like an extension on the emergency fund imo. I dont see how paying that off gives me an edge really unless rates dropped to where the cd was less?

The only difference is you pay taxes on the interest from the CD.

 

[Nick87]

The only difference is you pay taxes on the interest from the CD.

Hadn't thought about that.

 

[Redmt]

Unless I'm wrong, CD interest is paid at maturity of the CD. One thing that got me was that say they are offering 4% yearly interest on your CD except the CD is actually 6 months to maturity. Your Interest gains will be 2% and not 4. Find someone who knows more than a bunch of guys on a hunting forum

 

[Nick87]

Unless I'm wrong, CD interest is paid at maturity of the CD. One thing that got me was that say they are offering 4% yearly interest on your CD except the CD is actually 6 months to maturity. Your Interest gains will be 2% and not 4. Find someone who knows more than a bunch of guys on a hunting forum

There's plenty of people here who know more about money than they do hunting.

 

[Nick87]

@brymoore No new cds I think mine have 3 to 6 months until maturity I'll re evaluate then.

 

[mevertsen]

I have my daughter's money in a 6 month, auto renewal CD at the local credit union.

it pays monthly dividend at a rate of 3.75 percent annual return.

We have our house plus one other debt (which is in hardship, so we closed it and it locked in a 1 percent interest rate).

If we suddenly had $9500 in cash tomorrow, we'd pay off that debt.

We also havent had a car loan in 8 years. So I cant offer much in advice there.

It could be because of my life circumstances, but, I'm taking no debt if at all possible over doing the math on how much I could be making here or there compared to what we pay in interest on a debt every month.


We also refinanced our mortgage (30 year FHA, 4.75, 6.5 yesrs in) in 2020 to a 10 year, local credit union loan, rate of 5.0. Thw amount we're paying off is staggering.

Come on Sept 28 for the first debt and March 2030 for the house.

 

[TN2shot07]

There's plenty of people here who know more about money than they do hunting.

First, congrats on the progress! It really is eye opening as you see it happen with your money. I agree, I lIke reading a good hunting story as much as anybody but I think I’ve learned way more non hunting stuff on here. I didn’t read all the posts but make sure you have an emergency fund (at least 3 months) completely set aside from any of this money. This is all personal opinion, not an expert here! As far as the car loan, you are making the math work in your favor but those are not about math for me. The first time I bought something with a check I started looking at vehicles differently. I don’t like payments on anything constantly dropping in value. Keeping the loan makes you comfortable with the habit and any study on money shows people spend more when it’s borrowed. If you have the cash in the bank there’s nothing wrong with keeping the loan. It will definitely hurt to part with

 

[Nick87]

at least 3 months)

I shoot for 6 months minimum. Probably unnecessary. But it helps me sleep. I need sleep lol.

 

[TN2shot07]

I shoot for 6 months minimum. Probably unnecessary. But it helps me sleep. I need sleep lol.

Amen!

 

[Treeshark]

Just seems safer to me to have that money at my disposal instead of paying it off and slashing that cushion down until I get it built back up, but I admit I could totally be missing something....

You’re right, it’s the better play assuming the CD nets more than the truck payment interest costs.

Where this breaks down for many (most) people is this does not stay binary- a third variable of pissing that money away pops up. That third variable is why Dave Ramsey is so anti-debt.

 

[Nick87]

You’re right, it’s the better play assuming the CD nets more than the truck payment interest costs.

Where this breaks down for many (most) people is this does not stay binary- a third variable of pissing that money away pops up. That third variable is why Dave Ramsey is so anti-debt.

Yah totally get that. We try to be disciplined and get a little better at it every year

 

[Jbotto]

There's plenty of people here who know more about money than they do hunting.

Ha! I suck at both!

 

[thomas89]

As someone with tens of dollars to his name, just pay the car off and be done.

Heaven forbid something happen and you lose your employment, at least you’ll have a payed off car. You lose employment and burn through your emergency fund, you still need to figure out that car situation.

The worst part of budgeting is realizing how much money you’ve pissed away over the years. I tell you the best part of budgeting is not having to fight with your spouse about finances. Such a stress reliever to be done with that.

 

[CPAjeff]

But it helps me sleep. I need sleep lol.

This ^^^^!

Congrats on the budget! Like anything else which is consistently followed/applied, the changes and benefits will be immense - plus it gets easier over time.

 

[thomas89]

Another note: as you go forward beware of keeping your emergency fund in a CD, or really any money you may need "short term". From when I was researching CD's vs a high yield saving's account, the penalty for pulling money from a CD before maturity was often well above the difference in interest rates in CD vs. HYSA.