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Reply to "Just bought an $800,000 house on a $186,000 salary and now I'm panicking...."
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[quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous]This is OP, and I want to thank everyone for weighing in. It's been interesting seeing people weight in and different people's risk tolerances and approaches to spending and saving. When I started reading replies, I got more panicked. But then as people started asking questions, and weighing in with their situations, it made me feel more comfortable. Why? 1. We have no other debt - zero. No credit cards, no car payments, no student loans. We have zealously avoided debt for the last decade. 2. We got an early start on retirement savings, and have been consistent. We are in our late thirties, and have been putting away 10% of our income since our early 20s. 3. DW has been a Fed for almost fifteen years, so that pension is becoming somewhat significant - about $25,000 per year so far, and will keep growing as she continues to work for the Feds. 4. College is largely prefunded at this point. Figure that we have to save a total of about $1,000 per month total and we will have enough for room, board, tuition, and fees for all three kids at a public university. 5. We have an emergency fund of $150,000 in diversified mutual funds. Add all that up, and I am feeling better about things....[/quote] Your numbers are less believable with every post. $186k salary was $15500/month (exactly 186/12) with $11k take-home, then when people noticed that makes no sense the story shifted to $15.5k isn't your gross, it's your gross minus some but not all of your pre-tax deductions (so . . . not $186k salary after all, contradicting your post title). Now you have an extra $150k and assiduously avoid debt but for no reason at all you only put 11% down. What do people get out of trolling like this? It's not even an exciting thread.[/quote] I scratched my head at the take home pay but now I see what you are saying. And nobody keeps emergency $ in mutual funds, it doesn't make sense tax wise. [/quote] OP here. I recognize that I have not done the best job of explaining my financial situation, confusing gross pay, gross pay after deductions for retirement and health insurance, and and net pay, but I promise I'm not a troll! Why would I not keep my emergency fund in a Vanguard mutual fund? It's highly liquid - I can have access to that money within 24-48 hours. And I'd rather get some growth out of my emergency fund than have it earn less than 1% interest. Even if the market completely collapses, I will still have an emergency fund of $100,000. [/quote]
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