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Saving for retirement

November 5th, 2017 at 01:29 am

Focused on beefing up my Roth IRA for this year as my next mini goal. My default contribution is $100/month, which doesn’t come close to the $5500 yearly contribution limit. I don’t have any retirement matching or benefits at work. While I would ideally love to get to at least $3000 for this year, this may be a stretch after sending any extra money to that student loan for so many months.

Recently got a check for $200 from a one-time side project, so I sent that in. I thought about holding off because the market is so high right now, but I’m not planning to touch my retirement for 30 years, so ultimately trying to “time” investments at this point probably doesn’t make sense. Also expecting about $160 or so after tax from some overtime earlier this month, but these payments can be slow, so I’ll wait until it shows up in my direct deposit before counting it.

It’s funny how much more emotionally satisfying it is for me to see debt drop than retirement contributions go up, but that’s why managing money requires discipline!

6 Responses to “Saving for retirement”

  1. PatientSaver Says:
    1509887884

    Probably because letting debt stick around hurts you in the here and now, while retirement for many people is still a distant future event.

    How much more do you have left of the student debt?

  2. greenleaf Says:
    1509888547

    Hi PatientSaver,

    I have a mortgage worth of student loan debt (from grad school), currently in IBR, which is why it's not a good idea to put retirement savings on hold until it is gone. One of my loans was relatively small and had the highest interest rate, which is why I tackled that first. The income trajectory for my career is that salaries usually double to triple after you become more experienced, so most people do pay off their student loans successsfully- I believe the default rate is less than 1%.

  3. LivingAlmostLarge Says:
    1509898895

    Debt and retirement are probably going hand in hand. You shouldn't have debt when you retire and you do need it to go away.

  4. snafu Says:
    1509899194

    With SL and IBR Grad loans it's not realistic to set full out $ 5,500. ROTH contribution goal just now. I think it's wonderful to target $ 100.; possibly an extra sum on those months with 3 pays. It may be more efficient to create a hard copy spreadsheet to visually track grad school IBR loan for the focus it can provide on how interest is added to the initial loan. I wonder if it deserves 'gazelle' intensity and more effectively be recipient of any snowflakes of cash you can find.

    Possibly consider putting up SL figures on the side bar for SA responders to offer suggestions that might help.

  5. Dido Says:
    1509905258

    It's good that you are starting out with the Roth even while whittling away at the debt. With a 30-year time horizon, those $100/month contributions will add up to over 100K at a 6% return, and of course, as your income grows and time passes, you'll pay off that student debt and increase the retirement contributions. Right now you have the advantage of a long time horizon, so it's good to be starting to take advantage of it even if tackling the debt is more satisfying. And being conscious of the debt is a good thing! It sounds like you are balancing between the debt and savings goals and at your stage of life, that is appropriate.

  6. rob62521 Says:
    1509915860

    Compound interest if your friend, even if it isn't exciting when it comes to your retirement. As many have said before, you do want to tackle your debt so you don't owe when you retire, but you also need that retirement cushion so you have something when you do retire and you don't wrack up more debt.

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