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Hey J.D. I’m an avid reader and love the blog. Thanks for keeping me on the straight and narrow of trying to dig out of debt.

I do have a quick question though. I won’t overload you with tons of numbers. My husband and I currently rent. In the next 2-3 years, we’d like to buy a house. Because our credit cards and car loans will be paid off before that and we still may need to continue to build credit to get low interest on a house, what do we do? We don’t want to continue to use our one credit card. It has a low amount anyways.

Thanks for any help,
Tina

Just FYI for your savings account listing, ShoreBank was recently closed by the FDIC

I have a question about paying off student loans vs saving. I have just under $20,000 in loans at an average of 3%, which I was just informed will be cut by 1 percentage point in two months (so 2%). I am repaying in 10 years and also getting some perks from my employer in terms of loan repayment ($2,700 this year, hopefully more in the future).

I had planned to pay down the student loan as soon as possible (I think I could do it in 3-5 years), but now I’m wondering if I should actually just stick with the 10 year repayment (plus help from employer), since the interest rate is so low. Should I invest this in a Roth IRA or just stick it in a high interest savings account? As background, my husband and I are currently both employed and childless. I’d like to be able to have kids in the next few years, so it seems like saving up might be the best idea, but I’m really confused about the benefits…

We do have a relatively healthy savings ($13,000 emergency fund, plus about $7,000 in other accounts) and my husband has $34,000 in student loans, although we are paying our loans off separately.

Any advice would be great!

hey there,
long time reader, occassional commenter, love the blog.
i came across this site recently that really put the whole concept of wealth and money into perspective for me, someone living in relative comfort in north america, and i thought of you and your readers. here’s the link:
http://www.globalrichlist.com/

Dear John.

I love your blog, and have been reading it for a few years now. Thanks for all the helpful information, fun guest posts with personal experiences, resources, and practical advice.

Recently, though, I’ve become seriously discouraged with the whole concept of “getting rich slowly.” Inflation sucks away the value of every dollar I put into a savings account. I have one of those “high-interest” online accounts. It pays me 1% interest. Inflation is 6%. So I lose 5% of my wealth every year.

I’ve been doing things like buying a bit of gold & silver here and there, and I’ve moved much of my IRA into foreign stocks whose currency denominations are growing against the dollar, but as far as saving for a car, keeping a realistic emergency fund, saving for home repair, and keeping up with the growing prices of food and other stuff, it’s impossible to “get rich slowly.” I started 4 or 5 years ago getting out of debt and saving; I have no idea how what I did could even be done if I was starting today.

I may be saving “slowly,” but the economy is “extremely quickly” stealing the buying power from every dollar I save. Short of ex-patriating, I don’t know how to combat this. Maybe I can have a friend open a savings account in Australia for me.

How does the average citizen “get rich” — whether slowly or even at all! — in the face of the Federal Reserve’s pathetic interest rates, inflation of the monetary supply, bailing out its big-bank cronies on my (tax) dime, and the price of every good and service going up? It seems like frugality is no longer the way to win this game.

Thanks,
Stephanie

I have a question, I’m 26, wife 27, 6,000/mo net income after 401k/403b savings. duel income no kids with no CC Debt, one car payment (for another two months), and then all I will have is my student loans (41,460) and our Mortgage. The problem I’m having is that those 41460 in student loans are broken down into 10 seperate loans. Two of the loans totalling 10,000 are at 6.8%. My Mortgage is at 5.0% and the rest of my student loans 31,460 are at 2.4% with a payment of around 250 a month. Our income / expenses are ok, we have paid about 1500 extra on debt each month to pay off the cars and after the second car is done we will have 2,000 extra per month to put away or pay off the student loans. Our Emergency Fund is around 10,000, which I’m comfortable with as it appears our jobs are secure.

Roughly 4 months from now I will have no interest rate above 5%, and will be in a situation where if I choose to pay that money down fast I’m only seeing a 2.4% return while my 401k which i’m funding at 10% is seeing 15.8% returns so far this year. I’m tempted to stop the debt snowball after the 6.8% student loans are done. Any thoughts on my next step? Do I start fully funding my 401k and almost her 403b? or do I pay off the student loans and wait a year to start fully funding those retirement accounts? I’m leaning toward increasing our savings and slowly paying down the remaining 2.4% student loans. Any advice is helpful.

Re: the woman who calculated the cost to divorce her hubby, and debit card and credit card issues

Dear JD,

The article about 3 weeks back, that you got a lot of flak for regarding the woman who calculated the cost of the divorce and then divorced her husband was fresh and edgy.

I am not agreeing with what this woman did, but I am not her God and do not judge her. There are women out there who are in that position. This article discusses finances, obligations and happiness, which affects our relationship with money.

In our patriachal society, it is almost unforgivable for a woman to leave a man because he’s not the primary wage earner. Women who are housewives cook, clean, shop, take care of children, and make the house a home. The man this lady is talking about has given up (perhaps due to depression, and questioning his situation – regardless it is an issue between this man and his spouse).

I myself have been supporting my husband in school for the past 2 years, and it took him a while to come around with helping about the house. This is something are married couple must workd together, and deal with. If one gives up, the other spouse should help him/her, but we only have so much in our emotional bucket after work/children/being the sole wage-earner, etc.

Thank you for adding a different view with this article. I believe it was one of the best because it caused so much controversy. You’ve had so many responses, especially from people who still support the patriachal system. I thank you for censoring the ugly comments.

I mean the 80/20 spending, Dave Ramsey, Suze Orman, Jean Chatzky, were fairly parallel in their concepts. Your book analyzed and summarized all of this for us.

Thank you for listening.

I just wanted to drop you all at GRS, and especially JD, a note to say kudos for the great blog. GRS is my first foray into the ‘blogosphere’ and i have to admit that i regularly recommend it to my friends and acquaintences. my husband and i frequently share posts with each other and discuss them. we’re working on finding the balance in our lives, paying off debt and adopting many of the ideas promoted here.

I look forward to reading and continuing to involve myself in my money and in this blog. perhaps i’ll even write the reader story i’ve been meaning to write, the title of which would be something like, “Yes, we built this house ourselves!” which would tell our story of starting to read “mortgage free” one night, and finding a piece of property the very next day, which we are living on 9 years later in a 2500+ sq foot house that we created, at least 80%, with our own hands (and the help of some friends) over the course of 5 years.

Cheers and a happy and prosperous New Year to you all!

I saw a article that may interest you:
If Money Doesn’t Make You Happy Then You Probably Aren’t Spending It Right”
http://dunn.psych.ubc.ca/files/2010/12/If-Money-Doesnt-make-you-happy.Nov-12-20101.pdf

I just wanted to comment about the importance of having an emergency fund. In January one of my New years resolutions was to get my finances sorted, and one of the specific goals I set was to build a $500 emergency fund. So far scraping together the money for this hasn’t been too difficult and I have seen the fund grow and my goal be achieved quite quickly, actually.

Now comes the exciting bit. I live in New Zealand, about 3 hours drive from Christchurch which some of you may know was struck by a devastating earthquake on 22 February, leaving many people with nothing. While thinking about what I could do to help I thought ‘I know it isn’t directly my emergency, but it is someones”, and so I donated $200 of my emergency fund to Red Cross (I still need something in case I have an emergency!).

This is a very real example of why having even $500 you can lay your hands on is so important. It probably won’t be an earthquake, but you can be guaranteed you will hit some event in your life that will make you wish you had that emergency fund if you don’t and thankful beyond belief if you do.

Do you have any comment on http://www.endofamerica2011.com
I am curious.

For Sierra Black .. I read your article “what to do with an old 401 (k). You might consider a mirror article .. “What to do when your ex-employer transfers the 401 (k) you left behind to an IRA rollover specialist firm?”

If you have any interest in it, I would love to see two topics explored further:

1) low income – saving, debt repayment, etc. Crystal from Penny Saver’s story about funding her college education as an adult mentioned IDAs. This is the first I’ve heard of such things and wish there was more literature out there about help for low income families and individuals. I don’t need this type of information personally, but I do find it interesting. I also feel that while many of the topics in PF blogs are helpful for lower income folks (frugality, couponing, getting the most out of your stuff, etc), there are few articles that are explicitly geared towards low income families.

2) What happens after you retire. I’m 33 and I have this nebulous idea that after you’ve saved for retirement and actually stop working, that you’re now in spending mode. You still have to save for say, yearly property taxes, but other than that you’re just spending. I know this isn’t necessarily true, but I would love to see some articles here about life after retirement. Robert Brokamp’s article about how living below your means is saving for retirement twice – I’ve had this thought that I’m saving so my retirement income will be the same as my entire yearly now, not the amount I’m living on after savings. So that is what started me thinking on what exactly you spend/save in retirement.

Thanks!

Hi JD,

I’m not sure if you’re still in the market for the Sunday reader story series, but I have one about how I recently acted as my own contractor for the installation of a fence in my yard and saved myself over $2k. Here’s a link to the post on my blog: http://savingbucksfast.blogspot.com/2011/04/fence-project-is-finished-way-under.html

I have several posts on the project as I went through the process and can definitely expand the post to fit more within your character count.

Please let me know if you’re interested.

Indio

Sorry, JD, quick comment.

Some of your old archived stories with comments are showing up as a fairly intense green (we’re talking comments from 2007). Example here: http://www.getrichslowly.org/blog/2007/06/27/you-are-your-own-worst-enemy/comment-page-3/#comments

Not sure if this is deliberate, but that particular green is a bit hard to read continuously. Perhaps if it was the faded color of the old comments in recent posts?

Long-time fan of the site, you’ve inspired me to start publishing my thoughts on money saving, I’ve decided to focus on saving by not spending on certain things, not really for money but just to get it “out there”. I’ve become especially frustrated whenever I’ve talked to people about these ideas in person so maybe some random person will come by the ideas and it will make a difference to them!

Hi JD! Long-time reader, first-time commenter here – Thanks for all your great advice and hard work on this site!

I have a question, or maybe a suggestion for a future post I guess. My husband and I (almost 27 years old) are doing okay for ourselves: he’s a med student with a pile of debt building up (but 0% interest as its being loaned by a family member) and I just got signed on at a full-time job. Ignoring his student loans (until he graduates and starts earning $$), we’ll be able to make ends meet with a little left over for a 401k, some shorter-term savings, and paying down my low-interest student loans.

I feel like our current lifestyle is comfortable, within our means but just barely. We’re both at a place where neither of us will really say “No” if the other suggests going out for dinner, but our budget can handle a little of that.

But I’ve always been a little enamored of the minimalist lifestyle, living in smaller spaces, constantly cutting clutter, always shrinking your budget, and enjoying life instead of absorbing it. Problem is that as we are growing to fill whatever space we can: when the income grows, it seems our spending does too. When the space grows, our clutter expands with it. And every time I turn around, I see something else that I want or need. New place? Furniture! Closet space? Why would we ever need to get rid of anything?? We want to be frugal people, and we mostly are, but I think our ideals sometimes get lost.

I’d like to focus on the reverse: cutting the budget down until it has a little more breathing space and we’re saving more for a rainy day, and cutting our clutter down to be less of a psychological drain. I’d like to try and make these less of a chore and a little more of a challenge or a game. Something like: “Can we go for a whole month without eating out?” “Can we get rid of 100 items each this month?” Things that would be tough, but good goals that have a clear end in sight.

I’m trying to brainstorm ideas to come up with 6-8 monthly challenges that we could “play” on repeat. Any suggestions?

I’ve noticed both of my checking accounts are being changes to accounts with less features / significantly lowered interest rates. Is it worth switching to another bank in the current environment? My brother who interns for a regional chain says all the banks are facing a similar situation.

I’m interested in buying gold and silver also gold and silver stocks (mining etc…) How and where can I find this information. I attempted to Google it, but I found a lot of advertisements and so forth. Any help or direction would be great.

Thank you,
Sean

A friend sent me a link to this: http://www.creditsesame.com/
About keeping an eye on your credit rating.
Is this legit?

Many thanks!
J

I’d like to see an article about things people commonly forget that may cost them money or time.

For example I forgot to renew my driver’s license and it expired. I’m flying next week so if I hadn’t noticed the problem or didn’t have other forms of ID, I’d be out of luck.

A couple of other examples. My wife forgot to have her tags renewed on her car and I got pulled over while driving it. She freaked out but I thought it was funny. The police officer let us off with a warning but it could have been a pain.

I forgot to renew my membership in USA hockey. It’s essentially an insurance program for people that play hockey. Membership in USA hockey is supposed to be mandatory for anyone who wants to play in a rec league. I’m sure your buddy over at retirement extreme is a member if his rink requires it. Anyway, I got hit in the shin with a puck, it broke my pad and I needed 8 stitches. My insurance through my employer is pretty decent but I still had to use up $600 that I had in a HSA.

Even just making this as a user comments type article might be helpful.
Alan

I was recently awarded a grant to help pay off two of my student loans from Nursing school which total about $65,000. The current minimum payments are $90 (6.8% interest) for one and $300 (3.75% interest) for another. I’ll be receiving about $1000 a month for 24 months to go towards these loans. The details of the grant stipulate that this money must go towards these loans. My husband and I are a little stumped about the best way to apply the extra $600.

We have been following the Dave Ramsey model for the rest of our finances so we were thinking of applying the “debt snowball method” here and trying to pay off the smaller of the two loans but it would take the entire two years to pay it off and I hate to not touch the larger loan at all. Also the larger loan has the smaller interest rate. Any suggestions?