What’s your question?

Paying multiple times vs just once doesn’t save you any money, but it keeps your utilization % down which improves your score.

I don’t schedule it, but I pay off mine like every week or 2 even though I have auto-pay.

If you can make extra payments without penalty, then once the balance is over you are done. And paying extra not only gets it over faster but even saves you money overall with less interest.

> that would make the principal AND interest owed per month lower, correct?

Monthly payments stay the same (except maybe last payment), just end sooner.

One thing to add:

With CDs the taxes on earnings are on your income tax bracket, unless bought in a retirement account like an IRA.

With stocks/funds, if you own it for more than 1 year then when you sell the taxes on earning are lower (15% for people in the ~$40k-$400k income range). Selling them in under 1yr has earnings taxed on income tax bracket just like CDs.

I use Fidelity, but others are just as good.

Index funds mostly are damn close to the index they follow. Just Google “S&P 500 price” and change the time-frames and you can see the performance. Besides S&P 500 there is also Total US Market and some others. It depends on what funds are offered, but you should be able to click on the ones available and see their performance and the fees (labeled “expense ratio”, you want this below 1% or even below 0.1%).

You yourself can just transition to bonds (should also be in the list of offerings) as you get older.

> Is this something I can change easily?

For mine, I can transfer 20%/yr from one fund to another (but I can change future contributions with no limit), the limit isn’t something I knew it just was a pop-up message when I went to do it. Meaning if I have everything in A and want to fully tradition to B, it would take 5 years. But yours may be different options.

You can also contact whoever is in charge of your retirement.

> Should I put a small amount into a year CD and the rest into a longer one?

You can do that, sure.

Do you have a stock broker (say Fidelity) that you use?

I have Fidelity and buying CDs thru them are easy, just select the time-frame you want and pick one. They also have automatic “ladders” that you buy and it is split between different time-frames. You just have to fund money to them from your bank account after you link them (takes a few days).

> Basically my question is, how much of a screw up is this?

You just missed out on less taxes. It’s not like you have lost any money.

Just do tax-advantaged accounts in the future.

> American Funds 2060 Trgt Date Retire R6

Target date funds have the retirement year in the name (so 2060) and it invests into stocks/bonds/etc. and the more closely the date approaches it changes the allocation more to bonds and less to stocks (just imagine people 1 year out from retirement with everything in stocks and then Covid hit and they lose hundreds of thousands).

It’s a hands-off approach. Because it is more safe, it has less gains than just say a fund tracking the S&P 500, but that’s the price you pay.

What funds have you chosen for your 401k?

> Platinum Honors which gives me a few extra percent cash back on credit card purchases.

Customized Cash card? That gives you 5.25% back on the category of your choice up to $2500 spent each quarter (saves $525/yr). Your saving earns 0.04% ($40 for $100k).

Discover is 3.6% right now ($3600 for $100k). Then whatever credit card savings you get.

Even just a 1% saving account will save you about 2x what you get now.

You can think of - like “opposite of add”.

If you owe me $1, you have now -$1 compared to before.

If I do the opposite, now I give you $1 and now you have +$1 compared to before.

Just looked this up, it currently does but 2024 and beyond the RMD is gone for both IRA & 401k plans that are Roth.

This is good for those who have other sources for money like SS (or will just continue to work) and wish to let their 401k continue to grow as much as possible.

Didn’t really make sense for Roth accounts to have RMDs in the first place. For Traditional it makes sense as they don’t want you to just put it off and possibly die with paying the taxes for many years.

You are discussing IRAs, OP is asking about 401ks (I thought IRA too, until op I read the description of 3 options and re-read the title).

I assume these are 401k plans.

Pre-tax (Standard): Pay taxes on your contributions upon withdrawal. This lowers your current taxable income, which may be beneficial.

Roth: Pay taxes on your contributions now. Gets taxes out of the way (no one knows what future tax brackets may be), especially good if you start your career in a lower tax bracket. For most high-earners, a Roth 401k is usually not a good idea.

After-tax: This is a standard 401k but you can add additional money (already taxed like in a Roth) above the standard contribution limit ($22,500 for 2023 and if <50) to a max of $66k (including employer match) in 2023 if <50. However, earning are taxed, and is the only plan where this is so.

Now sure why the standard Pre-Tax and After-Tax are both offered (After-Tax is the same if you don’t contribute over $22,500 from paycheck deductions). Only thing I can think of is that the funds/investments offered are different.

General advice is to either invest in index funds (S&P 500, Total US Market, Total Foreign Market, Total World Market) or invest into Target Date Funds (you select the one with a date closest to your retirement date and it handles the allocation of investments for you and changes every year, doing more stocks at the start and more bonds towards the end). And make sure the expense ratios (fees) are low, below 1% for sure but below 0.25% even more so.

> Not sure what your dad's comment about insurance and equity have to do with each other, so either you misunderstood what he was complaining about or he doesn't understand something.

The escrow could have increased, so if they pay extra every month then the amount they pay extra would be less (unless they maintain the amount of extra payment).

Anything less than the standard of 20% will incur an extra PMI charge (on top of borrowing more money). The PMI is a percentage of the price, but the % value varies across lenders; so you’ll just have to ask and see what you’d get offered (note that you can request for this PMI to be removed once you hit a % equity ownership, usually 20%; but there may not be a legal obligation for them to drop it). The interest rate you get would also of course be a huge factor.

Colons are usually reserved for lists (or titles/names), either in-line or starting some bullets/numberings.

Semicolons are used mainly when either a comma (continuation) or a period (stop) could both be grammatically correct or acceptable.

2 main ways banks make money are by charging fees and giving out loans.

Checking accounts are accessed multiple times a day, so pretty volatile.

Savings accounts are accessed less (some even have limits, like 6 a month), so easier for a bank to use to give out loans. As a reward for allowing them to do that, they give you a cut of the interest they earn off loans. Bank of America and similar give terrible rates, starting at 0.01% APY, many online-only banks are now giving >3% APY, some even up to 5% APY (note that these will go down in the future once interest rates on loans go back down).

APR is the actual % that they use for calculations. However, sometimes they pay-out the earned interest multiple times a year, which means future interest is on the new, higher balance, so the pay-out is more, so for the year the actual amount of interest earned is more, this is APY, and this is the effect of compounding.

Examples:

1% APR paid once on $10000:
1% • $10000 = $100

1% APR paid semi-annually (twice) on $10000:
0.5% • $10000 = $50
0.5% • $10050 = $50.25
So an extra 25¢ where the APY is 1.0025%.

> Is your credit score looked at at all when opening one

It can be.

> Does having a better score mean you get a better rate on investment?

No.

The Wiki of this sub has a lot of good info.

I did cover co-pays, co-insurance, deductibles, HMO vs PPO, etc.

However, these kids don’t even remember what they had for dinner last night.

>What he got was regressions, statistics, etc w/ a bit of stock picking (no mutual funds allowed!), etc.

Had to teach regressions & some stats too. For my stock project I used MarketWatch’s virtual game (real-time stocks, but fake money, and tracks it all for them), not only did it allow funds but even limit/stop orders (none of my students used that feature though).

Had them do an investing/retirement spreadsheet generating a chart comparing 2 scenarios (differences in years invested, annual contributions, and yearly gains).

Monte-Carlo is actually in my text; however my course is a remedial one, so I'd only do that if I wanted to torture them.

It's bad, and this is a normal/upper income area (nearly every kid has AirPods, some have brand new cars). I can't imagine low-income where it's even worse.

> why dropshipping/financial gurus are a scam

I don't know if he was joking, but one of my students said they'll make a living drop-shipping and do organic marketing thru TikTok to get his links out.