Creeping up on my 2 year mark in the military and I can honestly say this is the most financially secure I've been my whole life. Just got a vehicle and going over all the budgeting now.
Paid off my Apt I was evicted from and now my credit score is high 600s. I did get a loan for my car and immediately put down 3500 towards paying that off.(16500 car, 12500 loan, 4500 for the rest, then 3500 towards the loan)
I still can't get approved for credit cards outside of Navy Fed.
I only contribute 5% into TSP so I have more money on hand. I have about 3000 in savings. I owe 8500 left on the loan, but I'm getting 7800 in November from my bonus. I'm either going to put all of it towards the loan, or maybe half just to lower the monthly payment to something more manageable.
So, as for savings what do I need to do? Bump up my TSP to 10%? Get a HYSA? I'm think Amex or Robinhood. I had Robinhood in the past but stopped using it cause it wouldn't let me move money around as much as I'd like. I also liked the fact you could buy and sell stocks with it.
Do I need an IRA Stat? Definitely want to get my emergency fund established. As for investing, is it better to save into accounts like IRA, HYSA, Money market, certificates etc?
I'm just curious on good ways like stocks I can be investing in. Or do I even need to?
Thanks for reading. I'll take a #1 with cheese and a sweet tea.
Robinhood & other options
byu/Upstairs_Zombie_745 inMilitaryFinance
Posted by Upstairs_Zombie_745
3 Comments
Idk what your car loan is, but it sounds like a high interest rate. If it’s 6% or higher, I would put absolutely everything you don’t need towards that.
After that, 7k to an IRA (I use Vanguard, but Schwab and Fidelity have good things too) would be the best next step, but just upping your TSP % would be easier and pretty close to equal. Just make sure you have 3-6 months of expenses saved up
That’s awesome news man. Good for you.
If I were in your position, I would follow some cherry picked Dave Ramsey style advice first- I would stack a small emergency fund of 1-2k, then immediately crush that loan until it’s all paid off. There is no greater emotional feeling than driving a paid off vehicle; especially when you started from the bottom like you did.
Once that loan is paid off, I would do what Ok-Republic advised and stack that E Fund in a HYSA. You’re on the right track with AMEX. I personally use Discover because I like the customer service. Because you’re military with a guaranteed source of income, I would recommend 3 months.
Once that E fund is stacked, continue to add 1-200 a month into it, and then start maxing your TSP as best as possible. Don’t worry about an IRA until you can max out that TSP and still have plenty of money left over. As you rise up in rank, keep your living expenses as low as possible. That compound interest from the TSP will start looking real nice once you hit 40-50k.
Keep up the good work!
Go read “the Simple Path to Wealth” by Collins. Best book I’ve read on the topic.