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Bernau picture

Question: Should I cash out a Roth IRA to pay a student loan?

Submitted by Bernau | Dec 08,2011

I'm 29, finishing a Master's program in Rangeland Ecology and Management. I'm down to thesis writing, so I haven't been a full time student for a bit and my student loan grace period is up.  I have about $40,000 in student loans, APR 6.8%.  I have no income at the moment, but I'm optimistic that I will be finished with school and have a job by May.  So I'm not worried about making minimum payments, possibly making big payments depending on the quality of the job.

Thing is, I happen to have about $17,000 just sitting in a Roth IRA.  Does it make economic sense to be sitting on this when I have a sizable debt?

The student loans are the only debt I have.

-Chris

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Justin24 picture

Question: How do I begin investing? I feel lost!

Submitted by Justin24 | Sep 16,2013

Currently I am 28, married and have a daughter who is 10. The only debt I have is my home, which I currently owe $300,000 on. We have $100,000 in equity. We do not have any investment accounts now and have $400,000 in our checking account (yep, I know it's crazy!). I want to put money away and begin compounding interest.

My 2 main questions are:
1) where should I put the money? I want to retire around 50, so 20 years from now.
2) what percent gains on average can I expect each year? I've done the compounding interest calculator and it really begins to put out large numbers once its gets over 10% a year or so.

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boehmto picture

Question: What's a good first credit card?

Submitted by boehmto | Sep 16,2013

I want to apply for a credit card and am looking for one that satisfies the following:
- no annual fee
- cash back
- at least a 20 day grace period for paying the bill

Recommendations for a first time credit card holder?

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Sarahkate picture

Question: What are some retirement options for 'the rest of us?'

Submitted by Sarahkate | Sep 11,2013

I never see this topic addressed: What are the retirement options available to the huge percentage of the working population who didn't ever make a living wage, whose daily living expenses even with roommates and scrimping very hard indeed seldom met monthly living expenses much less leave anything to save? And please do not trot out that old cliche about giving up fancy coffee drinks -- those of us who do not even make a living wage are drinking whatever is on sale at Walmart, not purveyed by Starbucks. All the experts want to do is talk to people who make a lot of money -- about their savings, investments and golden retirements. Marketplace Money's experts do need to understand that a very large percentage of working Americans simply do not have these assets but DO face the prospect of a grim retirement. Thank you!

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jdevine picture

Question: Does it help my credit if I buy a car?

Submitted by jdevine | Sep 07,2013

Hello,

My wife and I are looking to purchase a car and are curious about how taking out an auto loan might affect our credit scores.

We are both fortunate enough to have decent jobs and have been relatively aggressive savers, so it is possible for us to pay for a car in cash. In addition, we have been lucky enough to have been able to get by without incurring any debt (other than credit cards that are consistently paid off each month, no student loans).

As a result, our credit scores are based solely on credit cards and we have not had any debt involving monthly payments. At some point in the next couple years, we would like to buy a house and want to know if it would be a good idea to add an auto loan to our credit history. If so, how does the amount and duration of the loan factor into our credit rating? Are there benchmarks used by the credit rating companies? For example, would financing $10,000 dollars of the purchase be better than $5,000? Would a 24-month loan have a different effect than a 36-month loan?

Enjoy the show - any advice you might be able to offer would be greatly appreciated.

Best,
Jon

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Melzh picture

Question: How to save for retirement when starting in your 30s?

Submitted by Melzh | Sep 07,2013

I'm 33 and just started medical residency. I spent most of my 20's in school, so I don't have much at all saved for retirement or saved for anything really.

Now that I finally have a paycheck, I've figured that I can afford to save about 20 percent of it (or about $700 or so a month, so not a whole lot). Should all of that go directly towards retirement? Or should I save part of that amount for an emergency fund or potentially for a down payment for a house someday, and if so how much?

How do people manage to save for normal life events like houses, etc., while still being smart about retirement on this type of income? Thanks!

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Daryl Paranada picture

Question: Thoughts on target date retirement funds?

Submitted by Daryl Paranada | Sep 05,2013

What are your feelings on the "Target Date" retirement funds? My husband has several 401(k) accounts at multiple institutions from past jobs, and we'd like to consolidate them into one firm. We have all our other investments in Vanguard, and he has both traditional and Roth IRA accounts there he could roll the 401ks into. At the moment, both are using the Target 2045 funds. Are these types of funds generally fine, or would it be a bad idea to continue putting a bunch of money into them? Amanda, New York

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Daryl Paranada picture

Question: Is there a formula to figure out how much we need to have a moderate retirement?

Submitted by Daryl Paranada | Sep 05,2013

Is there a formula that can predict the amount needed if you're planning to have a moderate retirement? And I assume moderate because we're not planning to travel the world, buy a bigger house or two super cars. Last question, is it unrealistic to assume that expenses will decrease when you're 60-plus? I ask because I see my in-laws which don't have a mortgage, no kids in college, and their only expenses are food, utilities, gas and a few vacations during the year. - Jose, Ohio

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Daryl Paranada picture

Question: What's better: Roth after-tax account or pre-tax account?

Submitted by Daryl Paranada | Sep 05,2013

What is the difference between pre-tax and Roth after-tax retirement accounts? Will I pay less in taxes in the long run if I put all my retirement savings into a Roth account? How should I decide which type of account is best for me?  - Clarissa, Minnesota

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vecair picture

Question: Owning a home is a bad investment, right?

Submitted by vecair | Aug 25,2013

Why is it I never hear anyone talk about the full cost of owning a home and why its such a poor investment? By the time you pay all the fees, taxes, upkeep, interest, insurance and figure in lost investment value people will never make a dime. In fact, the house will cost double what you originally paid. It also ties people down to a certain area and helps keep them immobile. Why is it we never hear about the full and true costs of home ownership? Could it be that is not good for the economy?
-Great Bunndini

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