Reading another debt blog I was inspired to make goals for the year 2010. Some I will make and some I will probably not make but here is to making goals!!
1. Become debt free - Depending on if I get my work bonus and a tax return it may be soon or later. Goal is to be debt free at the latest by June 2010. I can do it!!!!
2. Increase retirement savings – I have a 403b and 401a at work. The 401a is how my job matches my retirement savings. Right now I am saving 8% of my pay towards retirement. I want to increase this but don’t know how much yet. I will probably increase once debt free this year.
3. Open an Roth IRA – I don’t really understand a lot about IRA’s but want to open one.
4. Start saving for a down payment for a house.
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A Roth is taxed now but not later. An IRA is not taxed now but it is once you’re eligible to withdraw. A Roth can also be accessed penalty free after five years, and before retirement age. This is generalizing, so ask a financial expert. A Roth is recommended by many experts (Dave Ramsey is one) as being preferable to a 401k, except for the match. Always take the match first, and whatever percentage you put aside on top of the match should go in a Roth. A Roth can be a good investment tool for saving for a house as well.
Nothing beats getting out of debt, though! You are automatically “giving” yourself the interest your debt would otherwise be charging.
Kudos to you for thinking about these things so young! You’re way ahead of the game!
Sounds like you have a solid set of goals for 2010! I opened my Roth IRA through Fidelty a few years ago, and didn’t have to pay account fees because I had a monthly automatic withdrawal set-up.