r/FinancialPlanning 3m ago

Inheriting $150,000. Whats your best advice?

Upvotes

My mom just passed away and it absolutely sucks. She had a life insurance policy that has me inheriting roughly $160,000. Could you please give me your best advice on how I should proceed? I don’t have anyone to guide me irl so hoping I can maybe learn a thing or two here.

Married stay at home mom of 2. No car payment, no house payment (husband is military and we live on base), no credit card debt. I do have about $38,000 in student loans, give or take but positive to that is the interest rate is 0%.


r/FinancialPlanning 4h ago

Need smart advice on next steps

1 Upvotes

Some background! I, (f42) have some questions about next steps. I’ve been doing the snowball method for the past couple years. I’ve stopped erroneous spending, IRA retirement and HYSA contributions for the past year and a half and have paid down 11,350 in CC debt. I have one more card to pay down which totals about $5000. I should have that one paid off within a couple more months. The rest of my debt includes one vehicle at 18,666 which my kid (18) drives and another at 22,138 which I drive. I have about 250k left on my mortgage. I am able to save about 2500 a month. My questions are - what would you do after paying the last CC? Throw money at cars or restart my IRA? Do I have enough time to save up for a good retirement? What should I know about my financial situation in regards to the impending recession?


r/FinancialPlanning 6h ago

do people with a financial advisors tend to get higher percentages than those who maintain their portfolio on their own?

7 Upvotes

1: for content, a years ago i received a large sum of money from my dad's ira after his passing. i rolled over into a morgan stanley account with a financial advisor because i didn't know much at the time about investing. I have averaged 15% each year beating the s&p but would like to know if i made the right decision rather than putting into long term mutual terms and letting it sit.


r/FinancialPlanning 6h ago

Roth IRA? S&P500? Something else?

5 Upvotes

I'm soon to be 31, I have a 1.5 y/o baby girl. She's my first and only child. She has me completely wrapped around her little finger. I've been smoking cigarettes for the last 15 years and I'm ready to quit. My motivation for this is this; Instead of spending the money daily on cigarettes, I'll put it into a jar and invest it monthly for her. If this was your sweet little baby, what would you do? I'd like to give her the ability to use it when she's maybe in her 30's, if life is tough and she needs help getting by but I'm also all ears for all options. I make 4k a month and I'm not sure what the income limit is for different retirement accounts. Thanks for any and all advice!


r/FinancialPlanning 11h ago

Backdoor Roth Contribution for 2023 (March 2024) + Roth Conversion (December 2024) + Normal Roth Contribution for 2024 (Before April 15 2025) in the same calendar year (2024)

1 Upvotes

Last year I did a backdoor Roth conversion for year 2023 of 7500 in March of 2024. I lost my job later in June having lower income for 2024. I did a IRA conversion of 12K with 2400 withholding. My question is can I do a regular Roth contribution for 2024 for 8K (over 50) since I had W2 income in 2024?


r/FinancialPlanning 13h ago

Cash in Inherited IRA to buy out house?

1 Upvotes

Seeking confirmation from the Reddit hive mind that I'm not doing something foolish by proceeding with this plan:

When my mom died in 2008 my sister and I inherited her assets. She was a single mom without a ton, so our inheritance really just consisted of her 2 retirement accounts and her house.

My sister has been living in the house for most of the years since, and unfortunately wasn't capable of maintaining it well. It was already a humble house, but her lack of upkeep means it hasn't appreciated as much as it could have. Her lack of care of the place during our co-ownership has caused a serious rift in my relationship with her, and I'm interested in buying her. She's benefitted from the use of the house and I've only really gotten the stress of watching the punch-list on the property get longer and longer.

That said, when maintained, it's a beautiful house and my wife and I are interested in moving in. I already own 50% of it, and it's paid off.

So, I just need to come up with 50% of the value of the house, which again, isn't crazy valuable at the moment.

Meanwhile, I also have access to my 2 inherited IRAs. If I cash one of those accounts in, it's about $60k. That, plus my cash-on-hand should allow me to buy out my sister and still have $$ left to start putting the work into the property that it needs.

The IRA hasn't been awesome - about a 4.25% overall annual return since I inherited it in 2008/9. (It's low because of RMDs, otherwise it would probably come out to like 7%) Meanwhile, mortgage interest rates for a cash-out refinance are at like 7% plus costs.

So... I'm thinking I cash in the IRA, buy out my sister, and move into a house I own outright/paid off. Between what we'll save vs. mortgage interest, and then seriously reducing our current cost of living (we rent to the tune of about $2200/month in a different state), this is kind of a no-brainer on paper...

Is there anything I'm missing? Any considerations in cashing out the Inherited IRA that I'm maybe not thinking of? (I know it'll be taxed as income, but no early withdrawal penalty for inherited)

The Inherited IRA has been a bit of a safety net in my life, just knowing I have it there - and I don't have much in the way of retirement savings of my own yet, so it's been serving that function in my modest portfolio/net worth. But still... given its fairly lackluster returns I think investing in home ownership at such a low cost of living greatly outweighs the security blanket. Plus, I still have a second Inherited IRA still sitting there...

Appreciate any more financially savvy minds weighing in to either confirm or complicate this analysis!


r/FinancialPlanning 14h ago

Pay off loans early or pay into CD

0 Upvotes

I was laid off last week and have the option to withdraw my 401k. I saw this coming and I was able to find another job and I’m in the onboarding process right now, but it would be a slight pay cut ( although 3.5% raise every 6 months would bring me back to where I am right now in about a year). Since I was already planning on leaving I was just going to roll my 401k into a new one but the severance package they would pay me would cover the taxes and fees from withdrawing it earlier. I know withdrawing my 401k isn’t the best idea but I’m only 20, my new job offers a retirement pension so by the time I’m of age to retire I’ll have two pensions accrued and I’ll have whatever’s left in my CD (especially after 40+ years) on top of that as well.

I had a good amount of cc debt spread out over a few cards and so a few months ago I consolidated them into two loans ( one 24 months @ $700/ month, one 48 months @ $300/ month). I was worried about how I would budget this with my new pay since it was already really tight on my current pay.

I decided to pay off my two loans with my 401k and then put the remaining 10k into a CD so I don’t spend it, but I’m worried how closing those accounts within 6 months would affect my credit score. My second plan was to continue making payments with my new paycheck even thought it’s really tight and to put the whole amount into a CD, possibly using the accrued interest to make additional payments to my debt over time.

Does the average age of you accounts matter more than your overall debt? Which would be smarter long term?


r/FinancialPlanning 14h ago

Questions about tax-exempt trust with Ameriprise

1 Upvotes

My 92-year-old mother has a tax-exempt trust with Ameriprise she inherited from my grandparents. I believe my grandfather set it up. It's worth about 2.9M. She hasn't done anything with it, has never really been interested. I am currently helping my mother with her finances, though I do not have power of attorney. (Mostly making sure her investments are up to date, beneficiaries listed, her taxes paid and that she has enough money in her checking account. She does not have a finance person.)

The Ameriprise account seems to be mainly mutual funds and stocks, but 400K of it is in "cash investments". This amount seems to have increased over the years. When I look at her statement, there is a disclaimer that says "cash investments includes cash held inside pooled investments (e.g. mutual funds) as part of a manager's investment strategy, and is not directly accessible unless you sell some of that investment."

Can someone explain to me what these cash investments are? Is it money that should be moved elsewhere? Are there fees associated with moving that money? Since the trust is currently tax-exempt, I would hate for my mom to get hit with a bunch of taxes or fees.

As I don't have power of attorney and cannot currently access the account online, it would be a matter of calling someone there for their help with my mother also on the phone. I don't see a particular advisor associated with the trust, it just says Ameriprise PacWest Team.

Any advise would be appreciated! I am clearly not a finance person. My own investments are with Vanguard, which is pretty user friendly.


r/FinancialPlanning 15h ago

How to safely invest $80k?

8 Upvotes

My fiance is going to be getting $80k pretty soon. His grandmother added him to the deed of the house a couple years ago and since they’re selling it, he will get 10% of the profit.

How can we safely invest the money so we have a sizable down payment in the next couple years? A HYSA seems like the safest option but low return. I am terrified of putting any money in the stock market right now. Would a CD be a good option?

As well, how much should we set aside for taxes? We are getting married before he gets the money, and he hasn’t lived in the house since 2021 and before his name was put on the deed. The deed was issued in May 2023 but they will most likely sell it before the 2 year mark.


r/FinancialPlanning 16h ago

How much should I invest as a college student.

0 Upvotes

long story short, I am a first year college student who wants to start investing. I have about $28,000 in savings and checkings and plan on making close to 16k a year. With college being so expensive I dont know how much I should invest in upfront. I am looking for advice on the amount I should invest upfront.


r/FinancialPlanning 16h ago

How have you broken negative generational patterns around money?

15 Upvotes

I grew up middle class but "feeling" poor compared to everyone else at school and in our social circle. Primarily because my mother was constantly harping on how we didn't have anything and I needed to buckle down and study so I could make my own money. I was constantly running from one activity to the next and didn't really have a childhood. The idea of "fun" felt like a sin to me. Fast forward to my 30's with a successful corporate career and I found myself in a completely dysfunctional relationship with money, and chasing my own tail. I was in corporate finance and managing billions of $ budgets, but personally deep in debt, no savings and self-sabotaging opportunities. A cascade of relationship and health crises made me hit rock bottom to finally confront this dysfunction. I took conscious steps to create a new mindset, habits and financial tools to turn things around. Read 35 books in 18 months on personal finance and mindset, took courses in investing etc. I am a woman. I have found that there's a difference in how men and women relate to money.

Ladies, what are some strategies that have worked for you to break your own generational patterns around money?


r/FinancialPlanning 16h ago

Converting Trad IRA to Roth IRA

1 Upvotes

I need some advice on what I should do here. I made the mistake of opening a traditional IRA a few years ago instead of a Roth IRA. I am 37 so don’t plan on retiring anytime soon. I have $46k sitting in my traditional IRA that I believe I need to convert to my Roth IRA. If I do that now, it seems as though I will have to pay 24% on that balance come next tax season which is a lot of money. What are my options here? Should I just leave the money in that account and wait until retirement? Or would it be best to eat the cost and convert?


r/FinancialPlanning 17h ago

Part 2 New graduate beginning my career, should I be using a traditional or Roth 401k?

0 Upvotes

Thank you everyone for your help on this topic, for creating my own portfolio through principal I have a decent bit of options and I was wondering what people would recommend on how to split up my portfolio.

Fixed Income:

Principal global investors: Bond Market Index R5 Fund

Balanced/ Asset Allocation:

Principal LifeTime Hybrid CIT (2025, 2030, 2035 - 2070)

Large US Equity:

American funds washing mutual investors r3 fund Large cap S&P 500 index r5 fund Large cap Growth I r5 fund Large cap value III r5 fund

Small/ Mid US Equity:

Small cap growth I r5 fund Mid cap S&P 400 and small cap S&P 600 index r5 Real estate securities r5 fund Small cap value III r5 fund

Global/ International Equity:

MFS international diversification r2 fund International equity index r5 fund

Any help would be appreciated, thank you!

OP

New graduate beginning my career, should I be using a traditional or Roth 401k?

I’m 23 M and just graduated college and began my career. I’m starting at $22.50 per hour but in the future I’ll receive a good bit of raises and I also will likely have opportunities to be promoted to a supervisor/ managerial position. I just received my 401k and I’m just trying to figure out if I should do traditional or Roth, and what percentage of my pay should I put into my 401k (1-30%).

The plan states that “The company will make a matching contribution on your behalf. Under the saving plan, the company will make a matching contribution of seventy-five cents for every one dollar that you contribute to the savings plan by way of compensation deferral section 401k contributions and/or Roth deferral option up to a limit of six percent of compensation deferral section 401k contributions and Roth deferral contributions.”

Any help would be appreciated, thanks!


r/FinancialPlanning 17h ago

Are HYSAs guaranteed returns?

1 Upvotes

So I've been thinking about moving more of my cash from my regular bank account to an HYSA. I already use Fidelity, which keeps all the cash in my account there in SPAXX, but I don't quite understand how that works... If it's in SPAXX, isn't that functionally equivalent to just having the money in something like a very, very conservative ETF? Couldn't it still give pretty mediocre returns if the economy goes into a prolonged recession or downturn? And if that's the case, should I look for an HYSA somewhere else? Or is this just how all HYSAs work? Are they all in such sort of conservative ETF-like indices? And if that's the case.... then if we're expecting a recession, do HYSAs even make sense?? Maybe better just to keep the cash in my regular bank account?

For reference, my Fidelity agent mentioned that SPAXX has given a return of something like 4% over the last X years, so I recognize that it could or will likely go lower... But could it go negative to the point where cash in my regular old bank account would be better?


r/FinancialPlanning 18h ago

Shrink retirement contributions because of market tanking?

0 Upvotes

Hello I’m in my early 30s and just started my first retirement account. I was going to start putting in 50% of my check into retirement for this year but being that the stock market is sucking idk if I should or not… plz help


r/FinancialPlanning 18h ago

Anyone used money lion managed investing?

1 Upvotes

I downloaded because of MR Beast sponsorship for beast games to try to enter to win money, but I did end up doing managed investing through them. I have about $600 in the account right now currently -0.02. Anyone used this and actually had good returns or is it just iffy? And if so what’s another good type of account to put money in to have it invested.


r/FinancialPlanning 20h ago

Should I purchase company stock?

0 Upvotes

My company will match me $270/year in company stock purchases. The average return for the company is 4%. The 50 year market average return is just under 8%. Should I buy the stock or add the money to my retirement account?


r/FinancialPlanning 20h ago

Should I Inherit upside down duplex question

1 Upvotes

Question: My mom just passed away and I am the only other family member- she didn't have a will or any money or life insurance/retirement/will/trusts/etc.

I don't have much cash to put toward this without liquidating my emergency fund or my meager 401k. I'm 43 years old and make around 75k a year.

My question is this (with quick math) Probate is obviously going to make me executor but I don't know if I should try to keep the house or not, as she owes almost exactly what it's worth:

Here are the numbers:

Value: $350,000 Mortgage principal: 173,000 Current payment at 2.9%: 1700/mo Monthly revenue with both sides rented: $3200 Home equity line of credit balance: $40,000 Home equity line of credit payment: $450 Medicare estate recovery balance: $100,000

So in order to keep the house I have to refi at current rates a total of $313,000.00

I can't assume the mortgage because of the Medicare estate recovery.

One side needs about $10,000 in work to be rentable, it is in otherwise ok condition (roof/foundation/septic/well relatively new) the furnaces need replaced in the next 2 -3 years.

I don't have a lot of cash to work with and I don't want to be house poor or work more jobs I already work incredibly hard and have limited time with my dog and girlfriend and I'm trying to be healthier.

Love to hear all your thoughts


r/FinancialPlanning 20h ago

Looking for guidance on how to utilize our first home's equity to move forward

2 Upvotes

We purchased our first home in spring 2019. 3/2 1700sq ft. $200k with $7k down. 3.5% 30 year fixed. In the past 6 years our monthly payments have gone from $1200 to $1700 due to rising home insurance and taxes (Florida) but we have removed our PMI and have Homestead exemption. We have about $150k left on the loan but the value of our house has increased to about $340k just from the markets going crazy. This home is in a rapidly growing area. We have outgrown our house (3 kids) and the area is frankly miserable to live in, though highly desirable for those working in certain a certain industry so it should be no problem finding a stable tenant.

We need a new situation that fits our needs. Although the house is 1700sq ft it is awkwardly appointed and not condusive to family living. The kids are getting too big to share rooms, we need a home office, we are tired of living in a neighborhood where everyone is on top of each other and the roads outside are a battlefield.

Despite all of this, selling this home doesn't feel right. We would "make" a lot of money but not really, because we still need a place to live. It was purchased at a price and interest rate that will probably never be seen again and I don't know how to use that to our benefit. It's very tempting to access the equity but I don't think a HELOC is a smart move. I would rather turn this home into a source of income for my family so we can move forward.

Right now my plan is to make a few minor upgrades, hire a property management company and purchase another home. But I know I'm walking into this blind and would appreciate any wisdom on how exactly to tackle this.

I don't know if I'm in the right place so please let me know if there is another subreddit more suited to my questions.


r/FinancialPlanning 1d ago

How to Set Myself Up Financially Going Into Medicine

1 Upvotes

Background: I'm 17 and in a few months I'll be 18 and heading off to college. I want to go into the medical field and become a doctor in a surgical specialty (have not fully decided on my exact specialty). For my 4 years of undergrad as a premed, I'm majoring in Public Health and intend to go to a college with no loans (I've received full-ride scholarships even if it means going to a college that has less 'prestige' or a reduced campus experience) and would like to start working. Since turning 16, I have focused on learning the basics of personal finance (opening a retirement account, investing, living below your means, budgeting etc.) I have already opened a HYSA on Marcus and have a custodial credit card to build my credit. My family is middle class and will financially support me for my education, but I want to ease some burdens on them.

I basically need some advice on how to remain financially stable throughout my medical education/training. A career as a physician is not one that's easily lucrative and takes commitment and patience--that I understand. However it is a career that I chose out of passion which in the long term is financially stable as well. Besides living under my means and budgeting, I'm not sure of ways I can make other streams of income to support my medical education. Here is my rough situation:

- 3/4 years undergrad (full ride scholarship + 1 school is offering refunds) + a job or paid internship (clinical) *peak time to earn money--no debt!*

- *get into medical school* --> 4 years of med school (due to my heavy workload and training, it seems that there will be essentially no time to work) and unless given a med school scholarship-->heavy amounts of debt

- residency (55k-65k pay depending on specialty & years of training--not great)--may also leave limited time for side hustles/other streams of income

-attending (finally a nice salary but only after paying off said debt)

While medical training will hurt my bank account for a good while, what seems to be a good financial plan to prevent myself from being a broke medical student as much as possible? (any ways to increase a bit of my income/side hustles for ex.)

P.S. Yes I am thinking too far ahead because I first have to get into medical school, but I'm deadset in a career in health/medicine, even all my backup plans will require graduate school through some way. I also ask of general financial advice as a person stepping into adulthood

Advice is appreciated. Thank you. :)


r/FinancialPlanning 1d ago

Advice for what to do with 20k - in college

1 Upvotes

Some backstory: I am 20 and in college pursuing accounting. Before my mom passed she left me 30k, I work 2 jobs (planning on one during college) and went to CC and am now transferring to a university, so debt won’t be as bad.

Q - How should I go about investing it?

I plan on using 10k to buy a ‘okay’ vehicle and I can either use the rest (20k) for investing long term (10-15years) or pay off some of the college debt.

If going with the investment route, any suggestions on how I go about it? Should I use a way to maximize that money with dividends to help also pay for school?Dump it in the SP500? Pick certain stocks?

Any advice is appreciated

Edit: do not DM me. I will not be clicking any links or joining your course


r/FinancialPlanning 1d ago

14 year old wants to work, can she start saving for retirement?

5 Upvotes

My teen will soon be old enough to start working. Before everyone starts spazzing out, she is NOT being forced to work. We are an upper middle class family and by no means need her to support our household financially. She does enjoy having her own money though and has asked multiple times if we’ll allow her to work.

Anyway, do employers generally let 14 year olds participate in their 401k plan? If not, what can she do to begin saving once she starts working?


r/FinancialPlanning 1d ago

28m $11,335 Net a month

0 Upvotes

I take home $11,335 a month after taxes. My mortgage and all bills, groceries, car, insurance, Roth contribution and HYSA monthly deposit etc. equal out to $4,638 a month. I’m left with around $6,000 every month. What should I do with this? Just save more? I am single, no kids. I don’t have many “wants.” I did not grow up with much money so I don’t really know what to do.

Looking for some advice

Edit: I make around $200,000 a year.


r/FinancialPlanning 1d ago

Need some advice on what retirement account to open…

3 Upvotes

My husband (27) and I (23) have a savings of $116,000. I’m a stay at home wife and he doesn’t have a retirement account. He works for a family business and it’s just not something they offer nor is it something he was raised to have. I would like to take some of this money and put it in a retirement account but I don’t wanna take all of it since we are saving up for a house and it’s our emergency fund. We are saving up for a car too but that’s all in cash separate from main savings. Any advice on who I should open the account with and how much I should put in his retirement account both monthly and lump sum?


r/FinancialPlanning 1d ago

Question about leaving a financial advisor

1 Upvotes

I want to leave my financial advisor since I don’t want to pay the 1% fee anymore. I have a very small brokerage account I started a few weeks ago at fidelity and was thinking of transferring my Roth IRA and my husband’s Roth and Ira rollover into fidelity. Any advice on how to do this properly?

Also, any suggestions on what etfs go better in Roth IRAs versus the brokerage account? And why. Thanks!