Friday, October 7, 2011

Finance Fridays: Welcome Decisions

My husband just found out he’ll be getting a 3% raise at work, and that leaves us trying to figure out what we should do with the extra money. We currently contribute 6% to his 401K, which is matched 100% by the company up to 4%. Side note – We used to just contribute up to the match, but instead of taking last year’s Payroll Tax Holiday and putting it into the economy like we were supposed to, we upped our contribution to the 401K.

So, we have several options for this extra money that I can see:
-    Increase our 401K contribution another 3%
-    Add to our Roth IRA contribution
-    Beef up our cash savings
-    Pay down our mortgage quicker
-    Blow the money on Starbucks and new clothes!

Although the last option sounds pretty tempting, I’m thinking it would probably be best to beef up our cash savings until we meet our 8-month emergency fund goal, then start adding more to the Roth. Which reminds me – I know I've posted here before about our monthly goals, but I haven't ever posted on our long term goals. Next week! Happy weekend!

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