Personal Retirement Funds

[Dangerkitty]

I have been maxing out my 401k for a while now. If you can afford it, its great if for no other than to see the portion of your paycheck going to King George being greatly reduced. Remember, 401k contribs skim off the top, before taxes come along... so for every dollar you put into the 401k, ~70 cents or so is what comes out of your net pay.

If you are not investing in a Roth IRA then you are really screwing yourself.

While 401k monies grow tax defered, Roth 401k monies grow tax free.

Maxing out a 401k is great but if you are not investing in a Roth IRA you are pissing money away.

 

[JohnDoe]

Any recommendations on companies to use for the roth? I was about to start a vanguard, and noticed that as of Nov 1st., their minimum starting contribution went from $1000 to $3000. Not that big of a deal, just seeing if they were worth it.

 

[shamrock]

Any recommendations on companies to use for the roth? I was about to start a vanguard, and noticed that as of Nov 1st., their minimum starting contribution went from $1000 to $3000. Not that big of a deal, just seeing if they were worth it.

I've had good luck and been happy with T Rowe Price for my Roth. There's no minimum to start a Roth IRA as long as you sign up for automatic contributions of at least $50 per month. They tend to be a bit more expensive than Vanguard but back when I wanted to open a Roth I didn't have $1000, so I went with them. I may look into Vanguard again for some future investments but I'll most likely continue with TRP as well.

 

[PC800]

RockyMtn1,

You dont need Long Term Care Insurance until you hit your late 50's or early 60's.

Not necessarily. There are many people in skilled nursing facilities due to accidents, not old age-- and such people often end up staying in those facilities for decades. While accidents can happen to anybody, younger people are more prone to engage in high risk hobbies (motorcycling, skydiving, etc.), so they're especially at risk.

I wouldn't say that LTC insurance should be a high priority purchase for everyone, but for those interested in covering all the bases, it's a prudent move-- and relatively inexpensive for younger folks, even with inflation protection and no-limit payouts.

 

[smellthejeta]

Yes, that is what I am saying. I know it sucks to miss out on company matches with 401k's but use that as your motivation to get out of debt, FOREVER.

You stated that if you make obscene payments to pay down your debt it would take you 4-5 years to pay it off. Well, what if you pay half that? Then it's going to take you 10 years to pay that off. If you pay off your debt and pay it off NOW you can then use your biggest wealth building tool (your job) to start building a financial nest egg for the future.

I dont know your situation, but if you could somehow take on a second job and bring in some extra income then you could really bust your tail to get your debt paid off. Think about it. What if you paid $1,000 a month towards your debt and got another part time job bringing in another $1,000 a month.

With $2,000 a month going towards your debt you could have that loan knocked out in just over 2 years or so. You then have nothing in your way developiing a HUGE pile of cash for your future. I know it would suck for a few years trying to get all that paid off but you will be in a much much better financial position if your do so.

Most people are resolved to the fact that the will never get out of debt. Thats why people who seem rich are actually flat broke.

Being in debt is only a scam brought on by the banking industry and the credit card agencies that have been adopted by the general public. When you are deeply in debt you have no chance getting financially secure unless you break that cycle. Being in debt only means you are getting the banks wealthy.

Thanks for the thoughts. However, I already work two jobs and overtime at the first It just sucks that the cost of living in this area is so high that in any other part of the country I'd be "doing great." I'm trying to establish a house downpayment/rainy day/job pisses me off and I want to quit/emergency fund. My goals now are to have $10,000 in that account (it's interest bearing at 4.00% -- not huge, but does the trick, no fees, and can be liquidated for no penalty) and then I'll reeveluate what I'm doing with the money going into that account. Given my past financial position, nobody can convince me that I am better off putting that money against student loans and then living off of my credit cards if something were to happen with my current job. I did that once already, and it was NOT pretty. The current job is by no means a career job, but I'm doing what I can to make it work while I'm waiting for the career to roll around. Pending the successful resolution of a hairy medical issue, this career job should be rolling around this summer. The offer's on the table, so it's not an "I hope it'll happen" type of job.

But I am with you on the whole debt mentality. The car got paid off 1.5 years early, the credit cards are paid off, and the only thing left is student loans. I'm actually paying those

 

[pilotyip]

Pilots without college degrees do not have student debt, start their careers four years earlier, which gives them a higher of income and with no student loans a lower rate of outflow. Nice margin for investmet.

 

[Dangerkitty]

Not necessarily. There are many people in skilled nursing facilities due to accidents, not old age-- and such people often end up staying in those facilities for decades. While accidents can happen to anybody, younger people are more prone to engage in high risk hobbies (motorcycling, skydiving, etc.), so they're especially at risk.

I wouldn't say that LTC insurance should be a high priority purchase for everyone, but for those interested in covering all the bases, it's a prudent move-- and relatively inexpensive for younger folks, even with inflation protection and no-limit payouts.

I realize that. However, LTC insurance DOES NOT pay for skilled nursing care.

Thats what Medical Insurance is for.

 

[Dangerkitty]

Thanks for the thoughts. However, I already work two jobs and overtime at the first It just sucks that the cost of living in this area is so high that in any other part of the country I'd be "doing great." I'm trying to establish a house downpayment/rainy day/job pisses me off and I want to quit/emergency fund. My goals now are to have $10,000 in that account (it's interest bearing at 4.00% -- not huge, but does the trick, no fees, and can be liquidated for no penalty) and then I'll reeveluate what I'm doing with the money going into that account. Given my past financial position, nobody can convince me that I am better off putting that money against student loans and then living off of my credit cards if something were to happen with my current job. I did that once already, and it was NOT pretty. The current job is by no means a career job, but I'm doing what I can to make it work while I'm waiting for the career to roll around. Pending the successful resolution of a hairy medical issue, this career job should be rolling around this summer. The offer's on the table, so it's not an "I hope it'll happen" type of job.

But I am with you on the whole debt mentality. The car got paid off 1.5 years early, the credit cards are paid off, and the only thing left is student loans. I'm actually paying those

Smellthejeta,

I will send you a PM in a few hours. Read it when you get the time.

 

[Dangerkitty]

Pilots without college degrees do not have student debt, start their careers four years earlier, which gives them a higher of income and with no student loans a lower rate of outflow. Nice margin for investmet.

Pilots without degrees also box themselves into a corner and limit their job prospects.

Like it or not many pilot employers require a college degree for someone to work there.

If I had not had my college degree I wouldn't have been hired at American Airlines, Delta Airlines nor the one Fortune 500 Company I flew for and the Fortune 500 Company I fly for now.

If someone looses their medical that can have a huge impact on their earning potential in other lines of work. Because like it or not many employers require that employees have a college degree.

Finally it is possible to have a College Degree and not have sutdent loan debt.

What you have against College Degrees and pilots is beyond me. But to encourage someone to not get a college degree is irresponsible to say the least.

 

[PC800]

I realize that. However, LTC insurance DOES NOT pay for skilled nursing care.

Thats what Medical Insurance is for.

Uh, no, it's not.

I have a very comprehensive Blue Cross/Blue Shield medical policy, and it provides very limited coverage skilled nursing care coverage-- and only for those enrollees that have Medicare Part A. Their benefits brochure specifically states, "Note: If you do not have Medicare Part A, we do not provide benefits for skilled nursing facility care."

OTOH, skilled nursing care coverage is a benefit of my John Hancock LTC policy. This is quite common in LTC policies, and often required by state law. For instance, for LTC policies sold in the State of New York, "The home care benefit must cover skilled nursing care, home health care, personal care and assisted living care."

 

[pilotyip]

The way I did it

Dangercat there are many ways to skin a cat, you have your way which you feel is the only way anyone should do things. "The way I did it". I do not agree with you, if my grandson elected to pursue a pilots career, I will recommend he not go to college full time, but follow the other time tested path where I have seen too many people succeed. That is fly full time, do your degree on the side, build time, build your resume. I will not debate the fall back value of a college degree, as I have stated many times it is nearly worthless after not being used for 20 years. Here are some of the latest Air Inc hiring stats for the Kit. Percent with no 4-yr degree, AirTran 12%, CAL 9%, DHL 33%, Jet Blue 18% and SWA 7%. Are those not good jobs? In addition, to take this one step further if 95% of the pilots applying have four yr degrees and those airline hiring non 4 yr degree pilots in the 7% to 33% range. It would tend to support that the degree is not all that important in getting a good airline job.

 

[smellthejeta]

I will not debate the fall back value of a college degree, as I have stated many times it is nearly worthless after not being used for 20 years.

I actually agree with you on this. I started a BS in comp sci before I got bitten by the flying aviatoin gig. I finished the degree for no other reason than 1) I already started it, 2) a degree in and of itself is useful, and 3) It doesn't matter what I get it in. So I finished it. The sucky part is because I really didn't care, I have a GPA of 2.6. Tough to get into a good grad school, tough to get a good job without a 3.0 (nonwithstanding the fact I graduated two years ago and haven't worked in the field since).

Now, at the age of 26, I'm faced with the very real possibility of losing (or not getting) my medical. How's that for gitting shat on? My answer to "what do I do" is... go to a community college or local state school and take some refersher courses in my major? Get my A&P? I heard there's actually a bit of a market these days for that. Go do a Masters degree? Where? I got into Riddle's extended campus program, and my employer will pay for most of it.

So your point on the immediate usefulness of a long-ago-gotten four year degree is pretty valid. I won't say that you are 100% right (because I don't know the situation for every possible degree), but your opinion has a lot of merit for those that think they can walk from an airplane after a furlough, BK, or loss of a medical to a degree they haven't used or kept up with in 5, 10, or 20 years.

 

[pilotyip]

smellthejet, this assumes when you put your 10-15-20 year old degree to use you are not going after "College degree perferred" jobs like apartment complex manager, direct phone sales and plumping dept manager at home fix up store.

 

[RockyMnt1]

College Degree

Here is bit of encouragement for those of you with BA/BS degrees...

The IT market today is in such a state that all of our entry level Java programmers must have masters degrees....A BA/BS just isn't competitive anymore.

Have a great day!!

 

[Dangerkitty]

Here are some of the latest Air Inc hiring stats for the Kit. Percent with no 4-yr degree, AirTran 12%, CAL 9%, DHL 33%, Jet Blue 18% and SWA 7%. Are those not good jobs? In addition, to take this one step further if 95% of the pilots applying have four yr degrees and those airline hiring non 4 yr degree pilots in the 7% to 33% range. It would tend to support that the degree is not all that important in getting a good airline job.

Yes, those are good jobs. And you are also proving my point. If someone really wants to go and fly for SWA then they better damn well have a college degree. With 93% of the pilot group at SWA having a college degree chances are pretty slim that someone without one would get a job there.

Right now SWA is hiring less than 50% of the pilots that they interview. If one really wants a job there then they better have all the advantages that they can to land that job. Not having a college degree severly limits someones chances at getting that SWA job.

Thank you for helping me prove my point.

 

[smellthejeta]

Here is bit of encouragement for those of you with BA/BS degrees...

The IT market today is in such a state that all of our entry level Java programmers must have masters degrees....A BA/BS just isn't competitive anymore.

Have a great day!!

Who is "our"? I know the quals have gone WAY up since I started college, but the MS required is new to me.

 

[pilotyip]

Did not see point

No dangercat, you did not see my point but then again, not all college graduates have that skill. If 95% of pilots applying at SWA have college degrees and only 93% of the pilots being at SWA hired have college degrees then the non-degreed has a better chance of being that the guy with a degree. The reason most pilots being hired have degrees is that most pilots applying have degree. It almost like all pilots being hired have an ATP, it is because all pilots applying have an ATP. I meam like almost everyone has college degree, but it is not the end all in anyone's career.

 

[Dangerkitty]

No dangercat, you did not see my point but then again, not all college graduates have that skill. If 95% of pilots applying at SWA have college degrees and only 93% of the pilots being at SWA hired have college degrees then the non-degreed has a better chance of being that the guy with a degree. The reason most pilots being hired have degrees is that most pilots applying have degree. It almost like all pilots being hired have an ATP, it is because all pilots applying have an ATP. I meam like almost everyone has college degree, but it is not the end all in anyone's career.

Well if you are going to use that type of logic then why dont you push for all Passenger Carrier Part 121 Operations to be flown only by Flight Attendants. Since no Part 121 Carrier has ever crashed with a Flight Attendant at the controls then it must be much safer to have Flight Attendants as pilots.

Right?

 

[pilotyip]

Danger cat again I do not follow. What does a college degree have to do with safety at the 121 air carrier level? Are you sure you got your money's worth in getting your degree?

 

[BenderGonzales]

If you have a Roth IRA through a company like Primerica, and you want to switch financial advisors and roll it into another one.... is that even possible???