The gross of the second salary, guys. Basically pointing out they could still save while she was at home, so this additional salary is set to be saved, gross, as a target. The taxes withheld would be then savings from the other salary.

Not hard to figure out.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:We save 100% of the gross amount

you mean net?

No - we set our goal at saving the gross, effectively eating into the net from mine.

Makes no sense. What is your IQ?

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:We save 100% of the gross amount

you mean net?

No - we set our goal at saving the gross, effectively eating into the net from mine.

Please explain the weird logic behind that

Anonymous wrote:

Anonymous wrote:We save 100% of the gross amount

you mean net?

No - we set our goal at saving the gross, effectively eating into the net from mine.

Anonymous wrote:We save 100% of the gross amount

you mean net?

We save 100% of the gross amount

Thank you pps. I think the first thing we will do is max out the Roth IRAs for me and my hubby, and I will work for the Federal government so I will also make the maximum contribution to my retirement there. And then I might contribute some to a MD 529 to get a deduction from my taxes there. I think that will take up most of the money I make this year anyway!!

Op, just as an FYI, you can use funds from a ROTH IRA for educational expenses without paying the 10% penalty on withdrawals. So you'd probably want to fully fund an ira (after any matching 401k options) before you contribute to a 529 or other college savings vehicle. This would give you the maximum flexibility for retirement v college savings.

http://www.irs.gov/publications/p970/ch09.html

I think your emergency fund is fine for the moment, your retirement funds are the biggest concern to me (like they say, you take out loans for college, but not for retirement). You might want to meet with a financial planner to get their assessment of your overall financial picture and give you guidance on how much you need to contribute to your retirement funds to catch up. I suspect it will be most, if not all, of your paycheck, but if there is any leftover, then I'd split the rest between emergency fund and college funds.

I'd do all retirement. Those retirement funds are low. College can wait (and you can't use college funds for retirement), and I'm guessing your income isn't so high that you won't qualify for some educational assistance. I might first start by pushing your emergency fund to $50k, but after that 100% retirement.

I agree that your retirement funds are low so I would do 2k retirement 1k college fund. You may also want to consider putting a little aside to get a housekeeper every other week. Two fulltime working parents have very little time and it is nice to prioritize that time for family activities instead of cleaning,

Do you need the second car for work? If not, I would keep surviving one one car and drive it into the ground and put all the extra money into retirement ($1,200 for each of you) and $300 per child's college savings fund. While retirement savings is generally determined off salary, which you didn't provide, both of your retirement funds seem low for your ages.

Good luck with the new job!

How much do you need to spend on a new car? I'd buy used and save up six months of expenses in the emergency fund.

Oh, OP again. We also already own a house. It's my lowest priority, but I would also like to save up a down payment for a house in a better area, if we need to. Our house is in an up-and-coming area and I would like to keep it as an investment property, if that ever happens.

We have been living bare-bones while I was a SAHM, but now I have a job. I estimate that after taxes and everything, I will be bringing in 3k a month. Basically all of it is going to go into some sort of savings- savings for our retirement, savings for the kids, savings for another car, an emergency fund... I am really overwhelmed and I don't know where to start or how to allocate it. Advice?

Here is our savings picture:
Emergency/new car fund: 35k
Retirement: 18k for me (I'm 30), 22k for DH (he's 35)
College fund for our 2 kids, ages 3 and 8 months: $0

Bright spot:
car note/student loans/credit card debt: $0

I am open to suggestions. DH's salary covers all of our other expenses and I'd say we save at least 1k per month, but that figure goes up and down, and we are crazily frugal, and I don't mind living that way. We also live in MD.