{"id":460,"date":"2010-04-20T08:15:45","date_gmt":"2010-04-20T13:15:45","guid":{"rendered":"http:\/\/www.mdmproofing.com\/iym\/weblog\/?p=460"},"modified":"2010-04-19T18:58:11","modified_gmt":"2010-04-19T23:58:11","slug":"liquid-savings-goal-reached","status":"publish","type":"post","link":"https:\/\/www.mdmproofing.com\/iym\/weblog\/2010\/04\/liquid-savings-goal-reached\/","title":{"rendered":"Liquid Savings Goal Reached"},"content":{"rendered":"

Astute readers will notice that, as of the end of last month, Lisa and I reached our Liquid Savings Goal of $15,000. For the first time, that little green “Liquid Savings” bar chart on the right sidebar shows progress of one hundred percent.<\/p>\n

Though we’ve not strictly followed Dave Ramsey’s Baby Steps<\/a> plan, we’re now up-and-over Baby Step 3:<\/p>\n

Create a full-fledged Emergency Fund containing 3 to 6 months’ worth of expenses.<\/strong><\/p>\n

The $15k gives us about four months’ worth of living expenses. With no debt other than our mortgage, and four-plus months’ worth of cash in the bank, I would like to take this opportunity to channel the incomparable James Brown and state that, yes, truly, I feel good<\/a>.<\/p>\n

What’s Next?<\/h3>\n

You’ll forgive me, I hope, for not yet knowing exactly what goal I wish to target next. If I turn to Dave Ramsey again, I see that Baby Step 4 suggests:<\/p>\n

Direct 15% of your annual pre-tax income into your retirement plans. Utilize tax-advantaged accounts such as 401ks and Roth IRAs, if eligible.<\/b><\/p>\n

While notching up my 401(k) contributions to 15 percent of income would be easy to pull off, effort-wise, I have over the last 5-10 years grown quite skeptical of the 401(k) setup overall. The high fees of my company’s particular plan are bad enough. But beyond that — call me crazy, if you like — I’m also way reluctant to start pouring more cash than I already do (enough to get the full employer match) into a tax-deferred investment vehicle which my spend-itself-silly government so obviously<\/a> eyes as a future income source.<\/p>\n

I’d favor the Roth IRA route, for sure. But even then, one has to wonder just how exactly the idea of allowing us “rich” Roth investors to withdraw investment gains tax free is going to play out in the future. (My opinion? Not well.)<\/p>\n

So … as I said, I’m undecided where to focus efforts next. In fact, when it comes to savings, there are a multitude of items we’ll need to consider:<\/p>\n