Budget Question - Efund completed, now what?

[winnied]

H and I recently reached the amount for our desired efund - huzzah! With the leftover $1,000/mo we were contributing to it, what should we do next? Here's what I'm thinking:

$250 - Car payment (Financed for 5 years with 4% interest) - $14,000 remaining
$250 - Start and contribute to Roth for H
$500 - Travel budget - contribute until at least $5,000 is saved for trip we're planning

We don't have kids and don't intend to have them or buy a house for several years. I currently contribute $13% to retirement and H contributes none (grad school.) I know travel is a bit high, but it's a priority for us at this point in our lives. I do have SLs but it's at 4% and I think I'd prefer to pay off the car and then once that's done, put more towards the SLs. 

[Susie]

I might max the Roth first, then use whatever's left ($50 or so?) toward the car. You'll do better than 4% on the Roth.

[winnied]

Oh, duh. This is why I have to write things out and ask them.

[aurora]

I agree with Susie. Roth first, then split between travel and the extra car payment.

[aspentosh]

Jun 12, 2013 12:11:49 GMT -5 Susie said:

I might max the Roth first, then use whatever's left ($50 or so?) toward the car. You'll do better than 4% on the Roth.

I like this idea a lot.

[bostonmichelle]

I agree max out roth's then pay the car loan or travel. Congratulations by the way on the efund!

[ijack]

roth

[winnied]

Thanks! Roth it is.

[sparkythelawyer]

Jun 12, 2013 12:09:46 GMT -5 winnied said:

H and I recently reached the amount for our desired efund - huzzah! With the leftover $1,000/mo we were contributing to it, what should we do next? Here's what I'm thinking:

$250 - Car payment (Financed for 5 years with 4% interest) - $14,000 remaining
$250 - Start and contribute to Roth for H
$500 - Travel budget - contribute until at least $5,000 is saved for trip we're planning

We don't have kids and don't intend to have them or buy a house for several years. I currently contribute $13% to retirement and H contributes none (grad school.) I know travel is a bit high, but it's a priority for us at this point in our lives. I do have SLs but it's at 4% and I think I'd prefer to pay off the car and then once that's done, put more towards the SLs. 

I probably would not break this up, but do it like so:

1) Max the Roth
2) Pay off the Car
3) Then split between travel and SL's.

[Deleted]

With $1000 a month left over I would do the following:

1) Contribute to Roth $500
2) Save for travel $300
3) Save for downpayment on house $200

I know you say that you don't plan on buying for a couple of years but when you do decide you will want money for a downpayment. If you decide in 3 years you want to buy a house then you will already have at least $7,200 saved for the downpayment instead of starting from 0 in 3 years and having to delay the purchase.

[Deleted]

I agree with Susie but just wanted to say CONGRATS on reaching your efund goal!

That is so, so ,so awesome!

[awkwardpenguin]

Congrats on finishing your efund! I say Roth, then travel/other savings. I fund my Roth over 11 months, so it's $500/month instead of making a lump sum contribution.