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Mommy214 05-06-2017 02:48 PM

Should I pay down debt or invest
My husband and I make roughly 80k/yr between us. We have 2 kids 2 and 6

36k in a savings account (so cash on hand)
18k in a rollover IRA
5k in a simple IRA
39k Cash life insurance policy from my mothers recent death
5k 401k Moms death (I need to do something with this soon)

10k car loan (2%) Im not sure what my interest rate is
12k student loan (4.5%)
57k home loan (6%)

I would say our current expenses/month are around 2400. The value of our home is estimated at 130k.

The bad news is my husband lost his job two weeks ago He made 50k per year. I would like to make our money work for us as I don't know how long he will be out of work.

I was thinning of refinancing the house to a 15year 3.75% boring 61k. I was not sure if this was a good idea or should we just pay it off

other thoughts were pay off the car and and the student loan?

Any help with this would be great.

emon123 06-01-2017 05:24 PM

Re: Should I pay down debt or invest
May be paying off for the house would be a good choice.But again this is just a suggestion.You have to decide your priority.But whatever you do keeping liquid idle cash in hand is not a good idea.It always ends up going away somehow.

Januar 06-17-2017 02:37 PM

Re: Should I pay down debt or invest
My suggestion: You should pay off for the house. As long as you have the debts, you need to consider which is the most priority. be wise to use the money. We hope your husband gets a new job. Good luck!

MegaMan45 07-14-2017 02:12 AM

Re: Should I pay down debt or invest
Dave Ramsey recommends using a debt snowball method where you pay off the smallest debt with the least amount of interest first, then work your way up. So you can use the life insurance money to knock out the car and student loan debt. After which, you could try refinancing on the home and then pay that off.

Thanks to your hefty amount of savings (36k) you have about 15 months of living expenses if you generally spend about 2,400 a month. However, I'm assuming you still work so you could try to reduce your expenses so that your family would solely live on your income until your husband finds another job. You can let your savings earn interest and grow and only use it when you really need it.

You could potentially invest while still paying off your home once your husband finds another job. It is better in the long run to invest as early and as often as you can. Also, budgeting software like MINT might help you find ways to live off your income until your spouse is fully employed. That is my suggestion. Of course, weigh your options carefully and I hope everything works out.

Ronsmith 08-25-2017 01:08 PM

Re: Should I pay down debt or invest
A typical circumstance individuals confront when entering the workforce or quitting any and all funny business about taking control of their cash surprisingly is settling on a choice between paying off their obligation or contributing. Both are excellent and vital. Paying off your obligation implies decreased anxiety, bring down dangers, a more prominent capacity to withstand individual crises or macroeconomics headwinds, for example, a subsidence or sadness, and expanded adaptability that can amplify individual joy.

Contributing means constructing a save that can ensure you and your family amid life's battles, creating what you trust end up being regularly expanding totals of automated revenue from profits, intrigue, and leases, providing assets to beneficial endeavors that make occupations and increment ways of life for your kindred nationals.

What would it be advisable for you to do? Hypothetically, the most shrewd strategy when settling on paying off your obligation and contributing ought to be to look at two factors:

The rate of after-charge intrigue you are paying on your obligation

The after-charge rate of return you hope to win on your ventures

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