Hello again friends.
I'm back hoping you can help me as you did before. After my last discussions here I had a concrete plan. I felt more motivated than ever before. Alas, I forget that life is often an unpredictable factor and can throw a wrench in plans.
As I explained in my last post, my wife and I had no debt besides our mortgage. While she was out of town her water pump failed and the engine burned up forcing us to get a new car. I got my wife a newer car. I tried to buy a car that was a few years older to avoid as much depreciation as possible. She was very happy with it. I'm happy that she's happy, but I'm very upset that we had to finance. Living without a car payment was amazing and now I feel as if I have backtracked. I know she needed a car, but I can't help but feel like I made a stupid mistake.
I elected not to use my emergency fund since it would've wiped it out entirely. We didn't have enough in it regardless so I figured having the safety net was a better choice. I'm looking for advice on how to proceed.
We have a mortgage with PMI of $87.15/month. The interest rate is 4.25% and we still owe $143,000 of the $160,000 and we now have the car with a 5.64% interest rate for 60 months. I have already set up biweekly payments and increased the payment amount over the lower payment they offered just to try and get it gone as fast as possible.
My original plan was this:
1. Throw everything at the mortgage until PMI is gone.
2. Max out my wife and I's ROTH IRA accounts every year.
3. Contribute my annual 3% raise to my 403b at work.
Now I'm not so sure what to do. I know I should max out my ROTH each year, I know I should get rid of PMI and the car loan, and I also know that my emergency fund probably needs to be larger since it couldn't cover this expense without getting totally drained.
Can anyone help or offer advice? What should I prioritize? I'm more than happy to share additional information or answer questions. Thank you!
I'm back hoping you can help me as you did before. After my last discussions here I had a concrete plan. I felt more motivated than ever before. Alas, I forget that life is often an unpredictable factor and can throw a wrench in plans.
As I explained in my last post, my wife and I had no debt besides our mortgage. While she was out of town her water pump failed and the engine burned up forcing us to get a new car. I got my wife a newer car. I tried to buy a car that was a few years older to avoid as much depreciation as possible. She was very happy with it. I'm happy that she's happy, but I'm very upset that we had to finance. Living without a car payment was amazing and now I feel as if I have backtracked. I know she needed a car, but I can't help but feel like I made a stupid mistake.
I elected not to use my emergency fund since it would've wiped it out entirely. We didn't have enough in it regardless so I figured having the safety net was a better choice. I'm looking for advice on how to proceed.
We have a mortgage with PMI of $87.15/month. The interest rate is 4.25% and we still owe $143,000 of the $160,000 and we now have the car with a 5.64% interest rate for 60 months. I have already set up biweekly payments and increased the payment amount over the lower payment they offered just to try and get it gone as fast as possible.
My original plan was this:
1. Throw everything at the mortgage until PMI is gone.
2. Max out my wife and I's ROTH IRA accounts every year.
3. Contribute my annual 3% raise to my 403b at work.
Now I'm not so sure what to do. I know I should max out my ROTH each year, I know I should get rid of PMI and the car loan, and I also know that my emergency fund probably needs to be larger since it couldn't cover this expense without getting totally drained.
Can anyone help or offer advice? What should I prioritize? I'm more than happy to share additional information or answer questions. Thank you!