TiredX2- My mother owned the '96 wagon before giving it to me, and she was on top of maintenance and repairs-sunk a lot of $ into repairs. So, barring a major repair, I think it could keep chugging for a few years. The paint is peeling off of the roof, is scratched on the sides, and has a hole in the carpet on the driver's side, and the gas mileage is around 19 mpg I think, but it's paid for. I just have to remind myself that while I might want a newer car, there are other financial priorities before that, and it is a safe car.
I'm not sure what our timeline is for home ownership. Hopefully, I will find a school counseling position this fall, with a salary around $40,000 and DP earns around $30,000. We both have very good/excellent credit. So, I'm not sure how a bank would view us in terms of a mortgage-if they would want me to have a longer employment history, if it would bother a lender that for the past few years we have had a decent amount of credit card debt, how much $ we should have saved up for unexpected repairs, etc.
Thanks for the info re: ING accounts-I just opened one!
Originally Posted by TiredX2
Wow, you're doing great with your steps!
How much longer do you think the '96 wagon will last? If several years, you could pay off the Matrix (increasing the payment after you pay off the credit cards) and then, once that was paid off use the money you have been paying towards the car to start saving for your next car. It sounds like you will be completely done with credit card repayments after your income tax refund, so that could hypothetically accelerate your car payment quite a bit.
What is your time line on home ownership? If you have 5K to start your fund, especially if it may be many years before you purchase, you might want to consider using that money to start a Roth IRA instead. You can withdraw contributions without tax or penalty at any time and you can even withdraw earnings without penalty for a first home purchase. I'm assuming you do not have a 401(k) or 403(b) or other company sponsored retirement plan--- if you do, especially one that has matching, you should look into those before an IRA.
As for how many accounts. We have a checking and saving account at a local credit union. (my kids are older--- 11 & 14 and they each have their own savings and checking acccount at a credit union, as well as ATM cards) We do bill pay through them, so it holds the amount we need for bills plus about $500 for security and ATM withdrawals. We then have an ING account. That ING account has *many* subaccounts. For example, we (DP & I) each have an account to hold our personal spending money, we have one for major home costs, one for vacations, medical ... When we actually spend money from those categories, we then transfer it out of ING to our credit union. I cannot imagine a bank would look poorly on too many SAVINGS accounts. It sounds like you could use our method quite easily--- just open an online account with subaccounts for each major area (holidays, insurance, down payment, etc...) and keep those funds there until you actually use them (for example, transfer the holiday money into your regular account in November). CDs are a common savings vehicle for home down payment--- you just need to decide on your time frame for purchase.