About Me

Amy

I created this blog because I like reading other military spouse's blogs. Part of being a military spouse is having the uncertainty of not knowing where you will have to live next or for how long. It often means moving around every few years and dealing with the deployment of a loved one. Financial advice isn't one size fits all and often financial advisors tailor their advice to the non-military folks out there, saying to buy a house right away and talking about 401k's instead of TSP's.

Two years ago (soon after my husband and I got married) I saw David's Bach's book, "Automatic Millionaire" and it truely changed my life and how I thought about money. We started out with pretty much nothing when we got married. I had $1,000 in credit card debt, and my husband had $1,000 saved from a recent re-enlistent bonus. We have since opened 2 retirement accounts, a high-yield online savings account (with automatic deductions from our checking account) and increased our networth from $0 to $18,000!

My husband's military pay includes his base pay, housing allowance, cost of living allowance, food allowance. All together it's $2,000 on the 1st of the month and $2,000 on the 15th.

We save 15% of his pre-tax income in the Thrift Savings Plan, which is the government's version of a 401k retirement account, only with no matching funds. Some people think we're crazy saving for retirement when we're in our early 20's, but we just want to use compound interest to our advantage!

We also save 25%, or $1,000, per month of his take home pay. We're saving to buy a home at his next duty station, though I have no idea where that will be yet. Currently we have about $12,000 saved up for our first home, and by the time we leave here (1 1/2 years from now) we should have at least $30,000 saved.

Part of the reason that we can save so much is that we have no car payments. I'm no finance expert, but I firmly believe that people spend too much on new cars when they should be saving instead.

Roth it is.

March 19th, 2007 at 09:38 pm

Well I've decided to open up a roth ira with the extra money we had in our checking account thanks to our tax refund. As tempting as it was to add to our savings account, it seemed like the roth would benefit us most over the long term. Thanks for all your input in my previous entry when I asked what you guys thought about opening the roth ira!

We opened the account with Vangaurd. I've heard good things about them, so we'll see. Smile

Posted in Retirement | 5 Comments »

5 Responses to “Roth it is.”

homebody Says:
March 20th, 2007 at 07:37 am

Good for you! I did call my son-in-law and I am supposed to be hunting for one that they can start with $500.00 each. What was the minimum at Vanguard?
Ima saver Says:
March 20th, 2007 at 09:11 am

I think you did the right thing. The minimum at Vanguard is $3000.
kv968 Says:
March 20th, 2007 at 03:16 pm

The minimum for their STAR Fund is $1000.
PauletteGoddard Says:
March 20th, 2007 at 04:02 pm

Good for you for opening a Roth. May Vanguard treat you well.
armyamy Says:
March 26th, 2007 at 06:23 pm

Thanks guys.

Yup the Star fund is min. $1,000...We did one of their target date retirement funds, it's minimun is $3000.

Army Amy's Amazing Personal Finance Blog (wow!

Saving money while my husband's in the Army and I work for peanuts.

Roth it is.

5 Responses to “Roth it is.”

Leave a Reply