Figuring out what to do with my money.
I know, this seems weird, right? I have freedom now! I can do so many things with my money. And that, is the problem. I'm not used to actually SAVING money. Before, I had a specific goal for all my extra money. Pay off debt.
Well, there's still my student loan. Which will be cut in half by next June (Thanks, California!) and has a relatively low interest rate (2.25%)
I opened a ROTH IRA recently. But the interest rate is a dismal 1.75% for a five year commitment. Blech. I can also have my credit union invest this more aggressively for a possible higher return. BUT, if I want to take the money out in five years to buy a house I may not want to be too aggressive right now. I don't really know what the future holds, so it's hard to make a plan on that right now.
I can put it in the flexible Roth account, which has an interest rate of .40%. Then I can choose to either invest aggressively or get a certificate at a later date. The money is not as locked in, but is still in a Roth.
OR (and this is what I'm doing, I think), I can leave the money I would invest in my Summer Saver which has a 3% interest rate until December. Then I'll invest another $4,500 (to make my Roth cap for 2011) in one of the Roth options mentioned above. Then I'll just save all my money in my Summer Saver until it dumps out next August and use it to invest and pay down my loan, while still getting to capitalize on the higher interest rate. This money also becomes part of my 3-6 month emergency fund once it's out of the Summer Saver.
But GEEZ. This is a pain. I'm not used to paying attention to interest rates. Frankly, I've never had enough money to see a big return on interest. But, if I can save $10,000 in my Summer Saver in a year, then the 3% interest rate might actually be worth focusing on.
It's not as satisfying of a goal as paying down down debt. And frankly, I'd like to have different accounts and invest in my Roth each month, but with interest rates so low, it doesn't make sense to do it that way. So I am having to put aside my
Does anyone else find saving/investing less satisfying than paying down debt?