Wednesday, July 20, 2011

To Roth or Not?

Year to date, I’ve contributed $550 into my Roth.  My 2011 goal was to contribute $2500 to it.  We shut off our IRA contributions because we wanted to save more money for the house.  I’m debating about contributing more to it now to reach my 2011 goal. 

I know that saving for retirement is very important.  However, both Y and I have awesome retirement plans at work.  His employer automatically contributes 9.12% of his pay to a pension for him.  He also participates in his work 457 plan.  I thought that he was contributing $100 per month into it because I set it up.  We just received his statement and he’s actually contributing $200 per month or $100 per paycheck.  I was happily surprised but I’m not going to switch it back. 

I just wrote a post about my 401K.  I will be getting a dollar for dollar match up to 5% so I will definitely contribute 5%. 

The big question is whether I want to contribute more to my Roth IRA.  I would also like to put money aside for a new vehicle for Y.  He’s had some problems with it and I don’t know how much longer it will be feasible to keep putting money into it compared to buying a good used vehicle. 

So many decisions…


  1. I am no expert on retirement, but it sounds like you have some good things going. I think it would be okay to wait, especially if you start saving for a car. If you're going to need to buy one soon, it would feel great to have at least a good chunk of it saved for ahead of time.

  2. I agree with LBC - it sounds like you have retirement covered and would maybe put half to the car savings and half to the house savings depending on which is your priority.

  3. Do you know the percentage of your pay that is going into retirement accounts? That might be a good way to decide. If you like the percentage you are at than use the money for other savings goals.

    You do sound like you have covered though.

  4. You do seem to be have a bit of decisions hovering around.

    I don't think any of the solutions are bad. From reading your blog I find you are a really good decision maker so I think you will come to a solution you can live with and be happy.

    Your retirement is off to a good start so I think it is ok to hold back on the roth to accomplish a few short term goals.