RBO answering First Gen American’s questions about #1’s finances post-mortgage

The next near term unmet savings goal seems to be DC1 and Dc2 college fund. More posts on that would be interesting to me as I also have one about the same age. Although I am about a year behind you on payoff, that is my next savings goal.

We decided to up it to $750/mo/kid, basically splitting the difference between what we’d need for a super pricey school and what we were contributing already.  That also means that is eating $500/mo of the not-paying-the-mortgage-savings we were seeing.

I guess you can also ponder some more about when to get that next car

This is a constant pondering thing.  It was in the shop again for a week because it started doing the squealing thing that it had been doing two years ago, and even though it is a cheap fix (tighten things), it takes them forever to figure it out.  Partly because it only squeals when the engine is cold and it’s cold outside.  Only $70 for that + replacing the windshield wipers (because why not), but also there was a week of us having to deal with only having one car (indeed, they didn’t completely fix the squeal because DH had to drive to the city for a meeting and needed me to have the car to do dropoff).  And since they’ve tightened everything the shocks aren’t being as nice and shock absorbent as they usually are which means my ride is more bumpy.  But each time my car needs fixing, we don’t know if it’s going to be the last repair for a while or not.  If it is, then we’re happy, but if the car has to go in again, it’s a pain.  So I don’t know.  We’re still pondering.  Eventually there will be enough excess in savings that we won’t have to rebuild the emergency fund after buying a Prius or something similar.  (We’re not there yet.)  The other car seems fine for now, and the insurance company of the at-fault driver took care of our costs and our insurance company’s costs.

Do general posts on spending budgets (not the day to day expenses, But those emergency ones). I remember feeling a little overwhelmed when my TV, washer and water heater broke within months of each other, until I realized they were all old and due to be replaced… A lot does get fixed when you have a big emergency fund. You don’t really need to keep such close track of everything.

Yeah, we just have a big emergency fund that could cover a washer and water heater and heck, even a new roof (though maybe not solar panels to go on said roof, which we might do after getting a new roof).  We have two water heaters and I guess they’ll be due to be replaced in a few years– can’t remember if we got the 15 year or the 20 year kind.  (And actually, a few months after we moved into this house, shortly after we finally purchased a washer and dryer, the water heaters needed to be replaced, and our dishwasher broke and we ran through a series of broken microwaves… fortunately we’d had paychecks for a few months at that point.  But it did put off our ability to buy furniture.)

Maybe some posts on where you’d move in retirement. I guess if you earn a lot but don’t have a lot of house, a no state income tax place may be a good place to live. I think I generally prefer paying state income tax as there are limits to what low income folks are required to pay. Paying crazy property taxes with a fixed income in retirement is no fun.

We hope to maximize friends and fun things to do in retirement, so we’ll probably be moving to a high tax state!  Most people will retire in place or move closer to family.  But it is a good idea for some folks to think through the tax and cost of living implications of different geographical areas once they’re no longer tied to a job.

14 Responses to “RBO answering First Gen American’s questions about #1’s finances post-mortgage”

  1. Joe Says:

    Ugh, water heater. We replaced 2 last year and the other 2 are getting long in the tooth as well. I guess I should learn how to DIY, but I’m sure I’ll throw my back out doing it myself. Probably not worth it…
    Good luck with the new car. Our car is 7 years old and it still runs very well. Hopefully it will last another 7 years with minimal issue. The new hybrid cars look very nice, though. Have you seen the new Kia hybrid. Pretty good price.

  2. Leah Says:

    I know you don’t typically do targeted savings, but might you consider putting the excess mortgage money into an account for a new car? I too hang on to cars as long as possible, but it’s really nice to have the peace of mind that I could go out and buy a new one tomorrow with no problems. Well, okay, I don’t have that anymore, but we did buy a new car. If my old gal died, we’d just go back to one car again.

    • nicoleandmaggie Says:

      Our big emergency fund already has enough in it to buy a car. (Failing that, we could sell stocks or take out a loan… if, for example, we needed a new roof and a car in September after I hadn’t been paid for months.)

      • nicoleandmaggie Says:

        Adding: right now all of our additional money each month is just kind of accumulating in savings. If we targeted some saving, then we might feel like we needed to spend more.

  3. nicoleandmaggie Says:

    TFW it is after 5pm and while you are making dinner you get an email from preschool asking you to bring in 25 valentines tomorrow.

    • Leah Says:

      blegh. So glad our school decided not to do anything this year. One kid brought in treats to share. I think I’ll do something to celebrate/share around when our little one is born so our toddler can feel special at school.

      • nicoleandmaggie Says:

        Zie came back with so much candy (most of it red, so zie can’t eat it).

      • Leah Says:

        Holidays like this are frustrating because my kid does not need candy. We monitor treats; she gets them, but not in a huge batch. All we got yesterday were fruit snacks and a lollipop (lollipop not going to her, because toddlers don’t need a choking hazard). huzzah.

        I will have to figure out a Halloween strategy going forward. I love Halloween (the costumes, the time of year, the fun of playing outdoors) but don’t love the candy aspect. I wonder if we can become like neighbors I had growing up that hosted hot apple cider and hot dogs as a stop in trick or treating instead of doing candy. Hmm . . .

        Can DC2 eat fruit snacks then? Or does it really depend on the brand and dye used? I don’t understand either why we insist on using dyes and such in the US that we know people are allergic to and that are banned in other countries. Okay, I do know why — profit — but am frustrated by that.

      • nicoleandmaggie Says:

        We don’t know. There is no test for red food dye, but bubblegum toothpaste gives hir hives and zie becomes extremely emotionally fragile after eating sprinkles or nutrigrain bars with red dye. The allergist said that of the ingredients on the toothpaste, the dye is the most likely culprit. So we’re checking labels, and lots of froot snacks use red dye 40.

  4. J Liedl Says:

    Spouse & I have picked a city we’d like to move to when I retire. It’s in a warmer part of the country than where we currently live (yay!) but also about as affordable as where we live (because our preference, the country’s largest city, is TOO DARNED EXPENSIVE). We have some friends there and we’d be able to do some interesting stuff from there (reasonable for travel and better weather for the outdoor activities we enjoy). Retiring in place would probably kill him early due to all the snow that never seems to stop. Speaking of which, it’s time to duck outside and shovel since they just plowed the street again!

  5. First Gen American Says:

    I am looking forward to kicking up the college savings soon. Honestly, aside from having other big expenses at the time, I wasn’t very inspired to save for college when my kids were in diapers. Now that I have a middle schooler who is already planning what type of toaster he will have In his college apartment, it seems just around the corner.

    I hope your car lasts long enough to be able to buy the one you want in cash. It’s a lot less hassle to buy a car when it is convenient vs an emergency.

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