Our two oldest children are visiting their grandparents for several days. It’s amazing how much quieter the house is and how much more smoothly the evenings go. Our evenings don’t revolve around corraling children – instead, we’ve watched a movie and played some board games in the evenings.

My husband and I are recently married and we are paying down our debts, he is focusing on his credit debits and being able to pay off his balance every month. I am focusing on paying down my student loans. We also have an a (very small) emergency fund and we have a 529 for our 9 month old that we send money to every month. My husband contributes to his 401k although I don’t know the details and I will be eligiable to contribute to mine the in spring. We currently have a townhouse and we are saving money for a down payment on a bigger house (we plan to expand our family and we have out grown our townhouse). We have to options, keep the townhouse as a rental or sell and put the equity to the new house. Ok, having said all of that, my husband suffers from the “Keeping up with the Jones’ ” symdomn and maybe I do too a little bit, but I am a pretty savy and I have really turned my husbands mind on to saving and trying to prioritize spending as well as, spendng it wisely. However, I am considering a joint checking account. Right now we split the household bills and them we are responsible for our own debt. Quite a few of the successful couples we know have a joint account and they say part of what makes their marriage work well for them is the amount of communication that goes into a joint account and those communication skills slip over into the other areas of their marriage. I don’t want to police my husband on what he spends “his” money on, but I think if we both saw what comes in and what comes out it might realign our financial priorities. Also, if we do decide to do this, how does this even begin to work?
- Chandra

I’m not sure what you mean by “how does this even begin to work.” If you have a joint checking account, the money in that account pays for the bills and also provides for the “spending money” for both of you. If one of you just spends like crazy, there’s not enough money left to pay the bills.

Because of that, it often forces couples to start communicating more about their money and realizing that they really are in the same boat when it comes to their finances. It’s often a big step forward for setting goals and planning for the future.

If this feels really uncomfortable for you, you need to ask yourself why. Do you not trust yourself? Do you not trust your partner? You need to dig deep into whatever is holding you back and get it straight with yourself and your partner or else this will just cause further problems.

I am a 26 year old, newlywed, with a 1,000 house payment, no other liabilities, 90,000 total income; 15,000 emergency funds in cash. We have worked hard to save money and our spending behaviors are great. I am just unsure we are doing the right things. I have opened and funded a Roth IRA for the past 2 years (have about 10,000 in assets). As I learn more about mutual funds, I’m becoming disappointed that I chose “loaded funds” through American Funds from a financial adviser/broker. I don’t know that I feel comfortable being sold financial services; I’d rather pay for good advice. Anyway, I own AGTHX and NEWFX. I recently became a husband and am working with my wife to get some investments going. We would really like to max out our Roth IRA’s. I’ve read so much about “no-load” funds and think I want to go with Fidelity funds (“no-load”) for the both of us (either target date funds or something else). My question to you is, what do I do with the American Funds, keep investing in them, stop future contributions but keep the balance, sell them and put them in Fidelity “no-load funds”. Any advice would be great.
- Randy

If you don’t like the offerings that your current broker is giving you, you can easily move your Roth to a new custodian broker.

All you have to do is contact the investment house you want to move your money to, explain your situation, fill out the paperwork (they’ll be happy to provide it), and wait a few weeks. Your Roth money will have moved to an account at the new custodian broker and you can allocate that money as you wish. It’s typically referred to as a transfer.

I have no comment about specific investments, other than to say I have my own Roth IRA with Vanguard and I’m very happy with Vanguard in every way.

I have been reading your site now for the past few weeks and had a question about preparing for my future. I am 21 years old and going into my junior year of college, I current work full time but once school starts it will drop down to part time. I have some savings set aside and trying to find a why that would best suite by needs. What I was looking at doing was to keep my savings account I have for sort term goals and as an emergency fund, open a high yield savings account for long term goals, and a IRA account (not sure which one is the best to use) for retirement. Here is my dilemma I don’t have a lot of money so would it be worth it to go with the plan I have or is there some better alternative I could try? I make enough money to cover all of my bill and can save up to 30-40% of my income. Is it worth it to open the above accounts even though the amount of money in them would be very small?
- Geoff

I think it very much depends on your personal situation. Are you in a field of study that will lead quickly to a job after college? Is your academic and extracurricular performance building towards a good career? Do you have a significant other and post-graduation plans that involve that significant other? Can you move back in with mom and dad if you don’t find a job?

In other words, you need to be able to make some estimates of what …

I love the local flavor of an area that I’ve never been to before, even in the United States. The word choices. The accent. The local culture. The food. The selection at the grocery store. It’s all similar, but just a bit different, like a different spice hidden in a familiar dish.

My husband and I bought (what we think) is a starter home last year and we think that we’ll want to sell it in 5-7 years since the public school system isn’t great in the area (no kids yet, but trying to think ahead). Anyway, in case we sell the house for around the same price we bought it, I am thinking of ways to make our money work for us in the next 5ish years to help us with a potential larger down payment. I have about $7,000 in a couple of stocks (Johnson & Johnson and Schlumberger) and have about $3,000 in cash that I would like to put in a Vanguard account (and then plan on adding to it monthly). Since most of this is based on speculation and the future, it is tough to plan. All I know is I want to make this $9,000-$10,000 work to its full potential in the next 5-7 years and was wondering what your thoughts were on the matter.
- Krissy

Well, you have a choice. You can either take on a considerable amount of risk and put it into stocks with the potential of a good return (and the potential of returning nothing at all or losing some) or you can put it into something conservative and lock down a small return.

That’s really the investment choice we’re all faced with. There is no “best” answer. It depends on our goals and our needs and our personal risk tolerance.

The longer your timeframe, the better the stock market option is because it gives you more time to make up for the inevitable bad years (like 2008). Five to seven years is just about the perfect time to go through one bear market and one bull market, and depending on how strong the bull is and how strong the bear is, it could be a net gain or a break even or a net loss. If you can invest for longer – fifteen years or longer – you can ride multiple bears and multiple bulls and, over the history of the stock market, the average bull gains more than the average bear loses. It’s just that you can’t bet on that from individual bears and individual bulls.

If I were you, I’d probably put the money someplace conservative and focus on squeezing a few more dollars from my standard of living.

I am twenty four years old, and I just got married back in October 2009. I am by trade what you would call a “Professional Musician” or “Hired Gun” or “Artist”. I’m a drummer, and song writer. This is all I have done since I was a kid. I have had a record deal, had a national release, and some radio success. The difficulty with being a musician, outside the realm of it being a “hobby”, is that work comes then it goes, and success is not solely based in being good or even great, it comes through connections and who-you-know. Not to mention that living in a town like Nashville where there are a lot of other people doing the exact same things, it makes it even more difficult to get in the door, EVEN if you a extremely talented! My wife has been unemployed for almost a year, but is furiously looking for a new job. I have been playing music and working as a server at a restaurant since my wife and I married, but our lack of income is constantly frustrating! The problem is that if I go get a great paying job or go to school to get a better paying job and then an awesome tour comes up, I have to quit. My heart and all my passion surround playing music, but it ain’t paying the bills? We live off a budget, have some emergency savings, and are paying off the remaining 4,000 in debt we have. Do you have any suggestions?
- Caleb

You’re asking about a field that I know little about aside from some friends that have dabbled in the alternative music scene. I asked them what they knew and they gave me a few things to pass along to you.

First, they suggest that you tour, tour, tour. Play as many live shows as you possibly can, even if they’re free. When you’re there, make sure you have t-shirts and copies of your album and bumper stickers to sell to the people that are there. Gigs build a reputation and keep income coming in, so get as many as you possibly can.

Second, if you’re a drummer, seek out at least a singer and a guitarist you can partner with so that you’re in this together. You’re in Nashville – it shouldn’t be too hard to find others who are trying to find a break. Even if you eventually go your separate ways, you’ll have built a resume. Tour with these people and split the proceeds from the t-shirts and albums and bumper stickers among you.

Third, make sure you do have some sort of album recorded so that you can sell it at your shows, even if it’s recorded in your basement using a laptop and a couple cheap microphones. Learn how to use GarageBand (that was their suggestion for software). Give away some tracks online. Do some online promotion, too, like with a Facebook fan page for your band.

They seem to largely think that if your love is music, then you should be focused on that, especially if you’ve seen some degree of success with it already. Just live as lean as possible for now and see where it goes.

The thing that bothers me most is when I see famous people complaining about how hard their life is when they have everything they could ever want.
- Kathy

What you’ve got to keep in mind is that there is no life without problems. There is virtually no one who does not want something different.

People who have financial wealth have often traded other kinds of riches to acquire it. Perhaps they didn’t build a great relationship with their family. Maybe they broke off their friendships with a lot of people to get where they’re at. Maybe they had to abandon a dream. Maybe they had to work in a field that made them feel empty inside. Perhaps their career path led them to fame that they didn’t really expect which restricts their freedom to just walk down the street when they want to.

No one on this earth has the perfect life. They may have elements of their life that you wish you had in your life, but I’m willing to bet there are elements of their life that you would absolutely not want in your own. I would imagine they feel the same way about you.

It could be that the richest person in your neighborhood looks at a poor but close-knit family and thinks to himself that he would trade all of his riches for that. Meanwhile, the close-knit family looks at the rich man’s big house and the shiny car and thinks to themselves that they would give anything for that.

Everyone has riches in different ways and we all sometimes wish we had more in some areas of our life.

I’m a 27yr old married guy with a 6yr old daughter and another on the way any day now. I’ve never borrowed any money from anybody in my life – not a loan, not a credit card, not a pay day cash advance, nothing. I love it this way – my friends and family have paid thousands upon thousands of dollars over the years in interest payments, while my wife and I have lived relatively debt-free. The problem is, I’m a credit ghost. I’ve tried to get some low-limit credit cards or loans to start to raise my credit score, but no one will approve someone my age who has never had a spot of credit in their life. Apparently, being a 27yr old with no credit raises all kinds of flags in banking computer systems due to the high statistical probability of my being a faked identity trying to pull some kind of scam. I even had to bring my ID, Social Security Card, and Birth Certificate to the bank just to be added to my wife’s 15yr old pre-existing checking account! I want to try and build my credit up a bit because I’m interested in buying a house around my 30th birthday. Do you have any suggestions about what I can do to get started down that path?
- Brad

The first place I would start …

Remember my complaint about soda about a month ago? It turns out that there was a labeling error. Apparently some bottles that contained “lemon soda” were mislabeled “lemon sour.” I’ve yet to receive a written response from the company, which may contain vouchers or some similar material. I’ll keep you posted.

After following your thoughts and advice, I am proud to say that I have eliminated my personal debt. My partner has made great strides in her debt, and now has about $50,000 worth of debt (car loan, consolidation loan, and credit cards).

It’s a nice problem to have but we really are not sure where to go with this. Thanks for your reply and help.
- Kate

I’m not entirely sure I agree wholly with either idea.

The big question I would have is whether or not you have a cash emergency fund sitting there so that if something bad happens, you’re able to just deal with it. If you don’t, then go for the first option.

Now, another key question: how high interest is that debt she has? It seems like it would be fairly high interest. If it’s above even a few percent, I would put paying off that debt as a higher priority than flipping properties.

I like option one much better, with the caveat of an emergency fund.

I’m my mother’s health care proxy and executor of her estate. I finally was able to nail her feet to the ground and talk about what her wishes were, but also what her estate entails. Right now she is 56 years old, with an ok paying job. I figure she makes about $40,000 a year, give or take, and has health care through her job. My dad is passed, so it is just her. She told me she has about $20,000 in cash, about $5,000 (yeah, that’s five thousand) split between three retirement accounts, and her house. She has a small home improvement loan on the house, I believe it is $10,000. The house is not in good condition. Looking at other real estate in her area, I am guessing that it would sell for $70-$90k. That is it.

Do you know of anything that I can do to help my mother not have to move in with us? Taking on an extra job or doing more is beyond her. Do you think it is wise to plan that she is going to be moving in with us? How can I convince my husband of this, if it does indeed come to pass – which I give a much higher possibility to, after talking to her.
- Susan

This is the tough spot that parents put their children in if they don’t adequately save for retirement. I see people in my own life following this path – and what’s going to happen in fifteen or twenty years is that they’re going to become burdens on their children whether they want to be or not. Save for retirement, folks, so this doesn’t happen to you.

Right now, your mother needs to budget starkly regardless of what she winds up doing. She needs to shore up every dime she can for retirement coming down the road, period.

Most likely, one of two things will happen anyway. Either she’ll keep working until she starts sliding downhill with her health (in which case, you’ll probably have to jump in to care for her) or she’ll retire before that and need a place to live.

It really, really depends on your mother’s character. Is she going to continually hint that she should take care of you? Or will she have a stiff upper lip and attempt to find her own solutions (low income housing, etc.)? If it’s the former, you’re going to have to make a tough call.

I’m a 25 year old IT consultant living in Chicago. I’m a computer science graduate, and I have a job where I make great money, live frugally (as much as you can in a high-cost city), save heavily and invest smart (automated, low-cost index funds). I’ve maxed out my Roth IRA for the last 3 years since being in the work force, and have maxed out my Simple IRA contributions last year and this year. I’ve already got about $50k in retirement accounts, and about $25k in more liquid savings. So, financially, I’m doing very well, and I’d like to thank you for getting me off on the right foot.