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Wednesday, June 16, 2010

What comes after the 401k and IRA?

If you have maxed out the 401k Match and you have Maxed out your IRA for the year.

Next you should have an Individual Taxable Account from TD Ameritrade for Saving and Investing. This should be your emergency fund. The Goal of this account is to get 6-9 months of your current income saved. This will only be used in the event you get hurt, or get fired. You would have 6-9 Months to find a job (Without tapping into your Retirement Savings) The higher income you have typically the longer it takes to find a comparable job.

  • This account can be added to and withdrawn at will, with no penalties at all. The only taxes you pay are those on interest, dividends and gains from your investing.
  • Also This account can have debit and check features
  • Also after  you have save the 6-9 months, everything saved after that should be used for saving and investing for large ticket purchases such as a house. :)
  • Also it would probably be smart for you to carry some disability insurance (You are 70% more likely to be disabled than to die before the age of 75) This way if you got into an accident that kept you from working, the Disability insurance will kick in and pay you an income if you can't work. 
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