Personal Investment Chatter

Emergency fund currently at ~$5k. Should I continue building my EF to ~$12k before opening IRA, participating in ACN ESPP, etc? Avg monthly expense is ~$4k. 25, SF, 3% 401k contribution. Base $127k.

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You should have about 3-6 months emergency funds. Get that before you start thinking about anything else.

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Would get emergency fund up to 3-6 months expenses. Then would also consider increasing 401k contribution equal to employer match (usually 4-8%). Your income puts you in an odd place for a Roth IRA since you are around the phase out. As you near the limit I’d consider looking into a Backdoor Roth. But the type of account you select should be with the thought of how much you think your tax rate in retirement will be. If your tax rate will likely be lower, contributing to your 401k beyond the match up to maxing out ($19k or around 15%) may be a better strategy. And then of course considering contributing to the ESPP as well.

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I agree with BDO1. You should put at least 6% into the 401k to get the full company match, unless you’ve been at ACN for less than a year (matching begins after first year).

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Then vesting takes another!

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6% 401k at least. 10% ESPP. You can request the funds back at any time if you have an emergency and need them. Otherwise you can sell at 6 months and get a ~12% return after taxes. Consider that your emergency fund, and maybe liquidate your first order so you can have that cash in savings.

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The 6% 401K and 10% ESPP is free moneys and part of your overall comp. make these the highest priority. I actually used ESPP to pay off credit card debt and then build my emergency savings. I’d guess I’m not alone there

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When I was clawing my way out of cc debt I would sell immediately and put towards the balance. Now that I’m out I keep it for at least a year to avoid short term gains. I’m trying to save for a house down payment now so have been selling more lately but generally try to keep 5-10% of my portfolio in ACN stock

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Your emergency fund should be 3-6 months your living expenses. But you can do half and half with an IRA now since 5k is a nice cushion. If you have time, read "Total Money Makeover" by Dave Ramsey for more information on financial goals. The read Millionaire Next Door and The Richest Man In Babylon to get into the basic savings habits. Lastly, pick up a random walk in wall street to learn more about what happens to your money and your money or your life if you are ready for the FIRE movement

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Wow thanks for the reading suggestions! Will add them to my list now. Appreciate it

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