Investing for Dummies

[civilspouse]

I feel like I should be taking more control of our financial future but I don't really know where to start. DH and I have always been equally involved in managing our day to day expenses but DH has always been the one who is more involved with our retirement investments. Right now we have put saving for retirement on hold during residency so that I can stay home. As I've been preparing our taxes I've realized though that the 401k I rolled over to an IRA when I left my job has just been sitting there for the last six months or so not earning anything. Usually DH would deal with it, but he just doesn't have the time. Also we have Roth IRA's but when I did my rollover we were told that I could not roll it over to a Roth without paying a penalty if we used a portion of it to pay the taxes. We had been thinking that a Roth would be better for us at this point since we will most likely be in a higher tax bracket during retirement. Now we have two Roth IRAs (one for each of us) and I have the rollover traditional IRA.

I would like to figure out what I should be doing to manage our IRAs since DH doesn't have time to followup on them. We don't have spare income now, but I'd also like to try to start to figure out what our financial approach will be post training. Paying off house vs retirement vs saving for college. Any tips on where to start? Thanks.

[spotty_dog]

Actually, the book Personal Finance for Dummies isn't bad. It's a good place to start. So is White Coat Investor's book.

If you want to give more details about what your IRAs are currently invested in, and where they are held/what investments are available to you, I might be able to weigh in.

As for the money decisions after training, that might be a good place for a fee-only advisor to sit down and get you set up with a workable plan. Typically you would start with where you want to end up (retire on what income? When? Put kids in what kinds of schools?) and then work backward to figure out how much you need to be putting away to get there on a reasonable expected growth. Alternately, you could take our approach, which is SAVE ALL THE THINGS. When our mortgage was in the 5% range, we maxed out our solo 401k while paying extra toward the mortgage principal each month and putting a few grand in the kids' accounts every few months. When we refinanced to a rate around 3% and a 15-year that was already plowing through our principal nicely, we switched over our "extra" savings to my spousal Roth and a taxable investment account.

[civilspouse]

Thanks [MENTION=985]spotty_dog[/MENTION] for the info. I was really hoping you would respond. You always post great financial advice and seem to know what you are doing. I want to be like you when I grow up (I also love your parenting style/advice) .

I'll see what I can find at the library and look into the White Coat Investor's book.

[spotty_dog]

Blush!

When I am back to my laptop I could link you to my Goodreads list of finance books. I remember Suze Orman's Women and Money being a real catalyst to help me cross that threshold from "I should know more about this stuff" to having a game plan and the confidence to start wading in. (Though I don't 100% agree with her advice on actual investing.)