Lacey and I have finally unified accounts for the most part. Just when I had figured out how to manage my own finances I am thrown the curve ball of accounting for both of our finances. Further, because I am dealing with joint finances, I am trying to get our financial house in order while giving equal weight to Lacey's ideas and goals. Fortunately, we share very similar goals.
One, very minor, difference in our savings philosophies relates to our individual interests in saving for a house and saving for retirement. I cannot help but be a huge proponent of proper retirement savings. Lacey, understandably, is more focused on purchasing a new house within a couple of years. Both of us are interested in both we just favor one a little more over the other.
We have agreed to apportion all savings in a 60/40% split. That is, we set 60% of our savings aside for the down payment of a new house. The other 40% of our savings is allocated for our IRA savings. All the money goes into a high-interest bearing savings account at E-Trade. So we have a "B & L House savings" fund and a "B & L IRA savings" fund. The initial balance of these two funds is quite lopsided because we put all of our wedding money into the house account.
My biggest hang up with the situation is my fear of failing to max out both of our IRAs each year. I know all too well the importance of time with respect to compound interest. So I can't help but cringe at the idea of failing to top off our individual IRAs. On the other hand...our time horizon for purchasing a new house is two years. Therefore, we have two years of the split savings where it will be a real grind to meet my goals for our IRA. I am confident that within two years we will be able to purchase our next house. From that point forward our savings split will be much more retirement heavy (we may even be able to get into taxable accounts at that point). So I think I need to calm myself and look at the big picture. I also need to be happy with the split we have agreed on as is and thank my lucky stars for having such a like-minded and understanding wife.
1 comments:
call my little bro. He'll give you a quality lecture on IRA's. After all, that's what he does for a living nowadays. Great posts though, keep 'em coming.
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