I am still pretty confused about what our next big financial goal should be. Lately, I have been looking into Dave Ramsey’s baby steps for guidance. (Is it just me or are some steps not “baby” at all?) I can’t really tell what step I am even on! Step 4 is Invest 15% of household income into retirement. Currently I contribute 7% which is matched by my employer. I also put away 1.5% each month into an IRA. But I work part-time, so should it be more like 30%? My husband’s retirement is super confusing because they don’t match, but randomly put money into a fund for him based on how the company is doing. He also has an 401K that he contributes to, but I am not sure what the percentage is. It’s definitely not 15%, but we try to increase the percentage whenever he gets a raise. And by we, I mean that I tell him he needs to and then nag him until he does (I take my CFO mom duties seriously!) Thus we may or may not be at step 4.
However, we do have college funds for our kids which is step 5. It is set to automatically withdraw money each month from our checking account. However, when unexpected expenses pop up, it is the first thing that gets cut. At some point, we need to get more aggressive in saving for their future. But I think we’ve got time (9 and 12 years to be exact!) So are we or are we not crawling around baby step 5?
If steps 4 and 5 are completed, that leaves paying off our mortgage. Is that our big goal then? Should we start on that 7-10 year journey? Does this Dave guy really know what he’s talking about after steps 1-3? I’m definitely curious what your thoughts are. I’ve tentatively listed my goals here, but I am not really motivated to get started until I have some more clarity.