Getting Ready For 2010

As preparation for 2010, I’ve spent some time updating automated contributions to various retirement, education, and cash savings accounts.  Here’s the breakdown -

My Retirement Accounts -

403(b)Monthly amount = $1375

A percentage of pre-tax income is deducted from each monthly paycheck.

Roth IRAMonthly amount = $312.50

My goal is to make the maximum allowable contribution for 2010.  For my situation, that’s $5000.

My Wife’s Retirement Accounts -

Roth IRAMonthly amount = $312.50

My wifes’ goal is to make the maximum allowable contribution for 2010.  For her situation, that’s $5000.  She also makes pre-tax contributions to her pension plan.

Education Savings Accounts -

ESA 1Monthly amount = $125

The annual contribution limit for my oldest daughter is $2000.  

ESA 2Monthly amount = $125

The annual contribution limit for my son is $2000.

ESA 3Monthly amount = $125

The annual contribution limit for my youngest daughter is $2000.

Cash Savings Account -

Automobile Replacement – Monthly amount = $500

At some point, we will need to replace one of our automobiles.

Future Home Purchase - Monthly amount = $500

At some point, we hope to pay cash for a new home (or use available savings for healthy down-payment).

Summary -

The total of all monthly contributions, excluding my wife’s contributions to her pension, is $3375, which represents a very substantial portion of our household income.  It’s important to note, some contributions, those to Roth IRA and Education Savings Accounts, are calculated for a 16-month contribution timetable, running January of 2010 until tax-filing deadline April 2011.

As we continue to live debt-free, my wife and I have come to realize just how important it is to save, save, save – and then save some more.  We set lofty goals for ourselves, including the contribution goals that you see above.

This entry was posted in 2010 Goals, Goals, Retirement. Bookmark the permalink.

8 Responses to Getting Ready For 2010

  1. Hey NCN – Do you also set aside money for irregular expenses (insurance, auto reg, etc) or do you account for them in your monthly budget?

  2. NCN says:

    SingleGuyMoney – I budget for them, each month, and put the money in a savings account. I also have a standard “emergency fund” from which I could pull money, should I need it sooner than regular budget would allow. What about you?

  3. Moneymonk says:

    Nice to see a new post. I thought you were MIA

  4. Boyan says:


    I see you’re contributing $312.50 monthly to your Roth. However, $5000/12 = $416 per month.

    What you may be doing (and what warrants further discussion), is making 2010 Roth contributions before April 15, 2011; thus giving yourself 16 months to get in $5000. Indeed 16*$312.50 = $5000.

    However, I’ve thought about this, and I’m not sure it’s the best idea. In your case, you’re depositing $625 per Roth (half for 2010 and half for 2011) in the first four months of the year, and $325.50 in the other eight. Thus, you’re systematically oversampling the market in the first four months, and biasing your dollar-cost-averaging towards Jan-April.

    Is this intentional (part of your strategy) or a minor oversight?


  5. Matt says:

    What happens if you contribute monthly to a ROTH IRA but than find out during tax time of the next year that you made to much to contribute, what happens?

  6. mbhunter says:

    Welcome back! Missed you! ;)

    That’s a lot of money into tax-advantaged accounts. Do you keep enough outside as well?

  7. NCN says:

    @Boyan I suppose you are correct. Keep in mind, I’m still making contributions to my 2009 IRAs, and will do so for the next 5 months. (Dec – April)

    @Matt I’m 99% sure that I won’t make too much to make maximum contributions. If I WERE to get close, I’d just hold back on the contributions from say January to April…

    @mbhunter It’s good to be back! I keep a 12 month emergency fund in my savings account…

  8. Good for you. This posts makes me a little sad though as your 403(b) contributions are more than my biweekly income. :-(