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Hi Fishes, I recently joined Pwc AC and was informed to update my checkpoint portfolio where we update all our investments. If we have some investments and if we do not declare them, will it be a problem or can I update it as Nothing to report. Recently I joined here so I'm having some confusion regarding this.
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Are you based out of the US? If you are, a good strategy is not saving for car and rather put the money into your retirement. When you need a car ( assume you are buying a new one ), wait for low interest rate offer ( 0% - 0.9%). The money in 401k you invested 10 years ago will grow a lot faster than the 0.9% interest you are paying for the car.
Coach
In 10 years!? No. What kind of car you trying to buy - a lambo?
A normal car. My cash assets are limited to about 6 months of expenses and literally everything else is in the market, mostly in tax advantaged accounts that I can't get to. This is more of a consideration for a house I suppose
You can withdraw contributions from Roth IRA at any time so just plan to pull out from there when needed. Assuming you’re young and early in career, you should focus first here than 401k.
You’re far better off in the long run saving in Roth and withdrawing later than not maxing Roth and only using taxable.
I would suggest to max out your IRAs and contribute to get the full match for your 401k. After that if you plan on saving for a car / house, probably best to put the extra cash into a brokerage account instead of a savings account given your 10yr window. You can take a loan from your 401k for a down payment but that’s totally up to you.
Most cars can be financed with only a few thousand down and very low rates. My VW SUV was purchased at 0% last summer. It was cheaper to buy new than pay 2.49% on used. I plan to drive this car into the ground/ wasnt worried about depn.
Why not try to find other places where you can cut to save for the house and car? You need both of them, 10 years is long away… so many things can change in your life.
Makes sense, when your salary goes up, you should be able to save more. May be for now contribute small amount for car+house. You can takeout a loan (if you don’t have enough saved)
Straight out no to the car.
For a house, you could look into investing into a Roth IRA, as the principle can be withdrawn penalty free after 5 years from the first contribution in some cases. Means you still invest into your retirement, but can pull it out if you want to redirect that investment to property.