I think those are all good options. Other things to consider are, as a PP mentioned, reviewing your insurance to see if it is adequate (do you both have long term disability, as well as term life?), paying more on your mortgage or refinancing to a shorter term, and of course as you mention spending some on vacations and other fun experiences for the family.

Anonymous wrote:

Anonymous wrote:1) pay off the student loans

2) make sure emergency savings cover 3-6 months of expenses

3) max out retirement savings

4) bump up college savings

5) find jobs that allows you to see your kids

OP again. Thanks, PP. I work part-time. I spend much more time with my kids each week than I spend away from them. So, fortunately, that came first. In the future when our youngest starts K we plan to stagger schedules so that DH has kids in the morning and I pick them up so they won't be in before/after care. We are very, very lucky to have these choices and to earn as much as we do (which FTR is far less than some DCUM posters, but far more than we made 5 years ago.)

Anonymous wrote:1) pay off the student loans

2) make sure emergency savings cover 3-6 months of expenses

3) max out retirement savings

4) bump up college savings

5) find jobs that allows you to see your kids

Anonymous wrote: 4. increase college savings for our kids (which has definitely been on the back burner). Right now we pay a large monthly bill for child care which will decrease over time, so our plan has always been to start contributing more once our kids are in school.

Only plan on having about 1/2 of the child care costs available to you. You will have before /aftercare costs, costs for teacher work days, winter break camp, spring break camp, summer camps.

Summer camps run ~ $1K a week for 2 children if you need before / aftercare.

OP again, appreciate the responses.

We are in our mid-30s and worked before and throughout grad school so even though we weren't making as much we have both been saving for retirement. But I think our priorities are in line with what everyone is suggesting on here--

1. pay off student loans (which we could do in a few months, and the roll that money into something else)

2. increase emergency fund (which is now 3-6 months of bare-bones expenses, but we want to have some more
on hand if and when our new, old house needs repairs)

3. increase retirement savings (which we've already started, but can do more of)

4. increase college savings for our kids (which has definitely been on the back burner). Right now we pay a large monthly bill for child care which will decrease over time, so our plan has always been to start contributing more once our kids are in school.

Will check out "The Millionaire Next Door."

Anonymous wrote:

Anonymous wrote:1) pay off the student loans

2) make sure emergency savings cover 3-6 months of expenses

3) max out retirement savings

4) bump up college savings

+1

+1

Max the retirement savings and consider, after other priorities, whether you can do even more in a Roth IRA, or nondeductible IRA. Graduate school means you have less time to take advantage of long term tax advantaged retirement savings, though of course you are still doing more than the great majority. We have been practicing this for 20 years for me (right out of college) and 15 years for dh who has a phd, and I just ran our numbers this week and we are in good shape. We could even scale back, but it is working for us so we won't. After all, you never know.

For purposes of comparison, right now we are saving $400 a month per child for college (kids are 3 and 6) and I think we should bump it up. That said when they get to college age I also want them to work and make intelligent education decisions.

Fairly recently we went back to church and find that nowadays you can tithe online and even pick and choose the monthly amounts and among a menu of purposes for the funds. I like how I can budget for the year that way. From that baseline then all year long charitable opportunities come up and I contribute as the spirit moves, so to speak.

One other important thing is to review your insurance. We have insurance through work, and also bought term life policies to cover our children's growing up years. We know we should also look into disability insurance, but we haven't made it happen yet.

Otherwise it sounds like you have good habits and great attitude. Our earning years are a great opportunity and us green eyeshade types really like to maximize it and make the money work.

Oh, and do read the Millionaire Next Door. It is invaluable for understanding the lifestyle and habits that lead to financial security and also for understanding the problems of the big hat no cattle folks.

Anonymous wrote:1) pay off the student loans

2) make sure emergency savings cover 3-6 months of expenses

3) max out retirement savings

4) bump up college savings

+1

Pay off that school debt and credit card debt then save for retirement.

We're about to increase our HHI by 15% due to dual promotion. We're allocating almost all of it to savings. I have a few more hopefully major increases coming, but may also go back to school (a significant expense). Retirement and college are our two big savings targets, in that priority order. We're good with our emergency funds.

tithe, save, pay debt, spend

+1
We did the same...increased our spending by only half of any increase in pay each year (and sometimes less). Invested the rest in retirement, college and "other" savings diversified between stocks, real estate and bonds or cash equivalents. At 50ish, we could retire now if we wanted, with enough to fund college and a nice but not extravagant lifestyle. So, yes, pay off the debt, boost the college and other savings, and enjoy the rest.

Save! You should be putting a minimum of 15% of your current earnings into retirement. If you are in the 25 or 28 percent tax bracket you should be putting the maximum you can into pre-tax retirement accounts (probably $17,500 each). You should also save as much as you can outside of retirement. Contributing $1,000 a year to your children's 529 accounts will not get them to college.

I'm in my mid-50s. Every time either my husband or I got a raise we allocated at least half the increased income to savings. We were able to put two kids through college without them having to take out any student loans and we are looking at a comfortable retirement.

We live nicely (we've been to Europe twice in the past three years and we regularly visit family in California), but we consistently live below our means and we did not allow lifestyle inflation to eat up all our increased income as it grew over the years. I have peers my age who will never be able to retire. We will retire and we will have a nice lifestyle in our retirement.

1) pay off the student loans

2) make sure emergency savings cover 3-6 months of expenses

3) max out retirement savings

4) bump up college savings

Build your emergency fund. It should be 6-9 months' living expenses.

DH and I have been doing fine for the duration of our marriage, largely because he is good with money, and because he had a decent cushion/inheritance from a parent who died young. I've learned a lot of his habits (mainly, not spending money whenever possible!). Since we've been together we've both gotten through grad school and are now starting to reap the benefits. Over the past 2 years our HHI has increased quite a bit, and I am looking at an upcoming promotion which will increase it even more. We are generally (not always) on the same page regarding money, but going forward, I want to make sure we are making wise choices.

We both have student loan debt (about $16k total at this point), and we have a mortgage, but no car payments, credit card debt, etc. We have $25k in emergency savings. We have 529s for our 2 kids and contribute about $1k a year. Both of us put about 10% of our (current) earnings into retirement. We give some money to charity throughout the year, but it's a small percentage of what we make. We moved last year into a new home and can comfortably afford the payments; we have plans to fix things up and will eventually have some large expenses (new windows, new HVAC) but nothing is urgent, and we are happy to do things ourselves whenever possible, so I don't see a big remodel making it onto the list of priorities. We love to travel and will likely take "bigger" trips than we've done in the past, especially as our kids get older, but our kids are preschool age and I don't really want to trot the globe with kids too young to remember or appreciate it.

If you were us, what would you do with this increase, and in what order? Or, if you have a great financial book to recommend, I'd love a suggestion. FWIW we did meet with a financial planner when I was pregnant with our first (6 years ago) but neither of us came away impressed or feeling like he told us anything we didn't already know, so I'd be reluctant to go that route again.