Pick Your Community: | Hopkins | Muhlenberg | Daviess | Christian | Fayette | Henderson | Lakes | McCracken | Warren | Webster
Davis Motor Sales banner ad

Dave Says – August 18, 2013

davesays300 green

KENTUCKY (8/18/13) – This week Dave discusses "Buying a house with 403(b) money" and "What term does he need?"

 

Dear Dave,
Should I take advantage of a 403(b) withdrawal in order to buy a house? - Bryan

Dear Bryan,
I wouldn’t do that because it really doesn’t accomplish anything. The only money you can take out is what you’ve put in, and any growth you’ve experienced has to stay in there. Basically, it’s a retirement plan, and I wouldn’t monkey around with retirement money to buy a home.

My advice is to make sure you’re debt-free and you have three to six months of expenses set aside in an emergency fund. Once you’ve taken care of those issues, you can pile up a bunch of cash in a money market account toward the purchase of a home. You won’t earn a lot of money, but it’s a safe place to park your cash when you’re saving up for a big purchase.

When it comes to saving and investing, I’m a big fan of mutual funds. The problem in this scenario is that if you start sticking money in mutual funds, then the market is down when you’re ready to buy, you could’ve lost some money. That’s not the route I’d want to go if I’m in your shoes, Bryan. I’d forego the opportunity to make money in order to keep it safe for this goal. - —Dave

Dear Dave,
I’m 24 years old, and I have a wife and child. We’ve been following your plan, and I’m about to buy life insurance. Should I get a 20- or 30-year term policy? - Derek

Dear Derek,
I think the big question is how long will you need this life insurance. If you and your wife are planning on having more kids in the next 10 years, I’d suggest a 30-year policy. That could put you in a situation of being 34 years old with a new baby. That’s not old by any means, but your wife will need 20 years’ worth of coverage if this happens, because you’d want the kids grown and out of the house before the insurance term runs out.

But that’s just one of your financial goals at this point. You also want to be debt-free. And you need to ask yourself some other questions. Are you going to have your house paid for 15 years from now? I sure hope you didn’t take out more than a 15-year mortgage. Are your kids going to be grown and gone by then? Are you going to have a big pile of money in the bank by then? In other words, where are you going to be at the end of the term?

If 15 years from now you have $700,000 in your retirement account, your house is paid for, and the kids are out on their own, then, if you die, your wife will be fine, financially speaking. But at that time, if you still have kids in the house and your home isn’t paid off, then you’d probably need a 20-year policy.

That’s how I would look at it. How much longer are you going to need life insurance? - —Dave

* Dave Ramsey is America’s trusted voice on money and business. He’s authored four New York Times best-selling books: Financial Peace, More Than Enough, The Total Money Makeover and EntreLeadership. The Dave Ramsey Show is heard by more than 6 million listeners each week on more than 500 radio stations. Follow Dave on Twitter at @DaveRamsey and on the web at www.daveramsey.com.


Disclaimer: The content supplied by columnists and letters to the Editor on this site does not in any way, shape or form, implied or otherwise, necessarily express or suggest endorsement or support of any of such content, statement, or opinions therein. SurfKY News does not necessarily adhere to or endorse content provided by outside non-staff sources.

© Copyright 2014 SurfKY News Group, Inc. All rights reserved. This material may not be published, broadcast, or rewritten without permission. SurfKY News encourages you to share this story by using one of the social media links below.

Posted on 2/2/14
Genovese - http://www.mchky.org/staff/bio.php?doc_id=35646&sub= Lewis - http://www.mchky.org/getpage.php?name=bracken_lewis Holt - http://www.mchky.org/getpage.php?name=drholt Napier - http://www.mchky.org/getpage.php?name=dr.napier_page Newman - http://www.mchky.org/staff/bio.php?doc_id=50353
Genovese - http://www.mchky.org/staff/bio.php?doc_id=35646&sub= Lewis - http://www.mchky.org/getpage.php?name=bracken_lewis Holt - http://www.mchky.org/getpage.php?name=drholt Napier - http://www.mchky.org/getpage.php?name=dr.napier_page Newman - http://www.mchky.org/staff/bio.php?doc_id=50353
3/12 - 718 switched from reg 2 to hopkins only
2/6/2014 - posted
3/13 - 16
Started 11/8/2013
Started 11/8/2013
Genovese - http://www.mchky.org/staff/bio.php?doc_id=35646&sub= Lewis - http://www.mchky.org/getpage.php?name=bracken_lewis Holt - http://www.mchky.org/getpage.php?name=drholt Napier - http://www.mchky.org/getpage.php?name=dr.napier_page Newman - http://www.mchky.org/staff/bio.php?doc_id=50353
Genovese - http://www.mchky.org/staff/bio.php?doc_id=35646&sub= Lewis - http://www.mchky.org/getpage.php?name=bracken_lewis Holt - http://www.mchky.org/getpage.php?name=drholt Napier - http://www.mchky.org/getpage.php?name=dr.napier_page Newman - http://www.mchky.org/staff/bio.php?doc_id=50353
3/12 - 718 switched from reg 2 to hopkins only
2/6/2014 - posted
3/13 - 16
Started 11/8/2013
Started 11/8/2013
Genovese - http://www.mchky.org/staff/bio.php?doc_id=35646&sub= Lewis - http://www.mchky.org/getpage.php?name=bracken_lewis Holt - http://www.mchky.org/getpage.php?name=drholt Napier - http://www.mchky.org/getpage.php?name=dr.napier_page Newman - http://www.mchky.org/staff/bio.php?doc_id=50353
Genovese - http://www.mchky.org/staff/bio.php?doc_id=35646&sub= Lewis - http://www.mchky.org/getpage.php?name=bracken_lewis Holt - http://www.mchky.org/getpage.php?name=drholt Napier - http://www.mchky.org/getpage.php?name=dr.napier_page Newman - http://www.mchky.org/staff/bio.php?doc_id=50353
3/12 - 718 switched from reg 2 to hopkins only
2/6/2014 - posted
3/13 - 16
Started 11/8/2013
Started 11/8/2013
Genovese - http://www.mchky.org/staff/bio.php?doc_id=35646&sub= Lewis - http://www.mchky.org/getpage.php?name=bracken_lewis Holt - http://www.mchky.org/getpage.php?name=drholt Napier - http://www.mchky.org/getpage.php?name=dr.napier_page Newman - http://www.mchky.org/staff/bio.php?doc_id=50353
Genovese - http://www.mchky.org/staff/bio.php?doc_id=35646&sub= Lewis - http://www.mchky.org/getpage.php?name=bracken_lewis Holt - http://www.mchky.org/getpage.php?name=drholt Napier - http://www.mchky.org/getpage.php?name=dr.napier_page Newman - http://www.mchky.org/staff/bio.php?doc_id=50353
3/12 - 718 switched from reg 2 to hopkins only
2/6/2014 - posted
3/13 - 16
Started 11/8/2013
Started 11/8/2013

Most Read This Week (Site-Wide)

August 17, 2014 2984

Greenville Police Conducting Traffic…

in Top Stories by Wes Miller
August 16, 2014 2973

Pogue's Automotive Annual Picnic Brings…

in Top Stories by Charles W. Riley II, SurfKY News
August 18, 2014 2561

Man Injured in Early Morning WKP Accident

in Top Stories by Rita Dukes Smith, SurfKY News Director
August 18, 2014 2351

Madisonville Man Charged for Shoplifting,…

in Top Stories by Madisonville Police Department
August 18, 2014 2231

Owensboro Board of Commissioners…

in News by Beth Cecil

Most Read Stories from Hopkins County

August 18, 2014 2351

Madisonville Man Charged for Shoplifting,…

in Top Stories by Madisonville Police Department
August 16, 2014 1377

Non-Partisan Offices Deadline Passes -…

in Top Stories by Keenan Ratliff
August 16, 2014 1191

Madisonville Police Conducting Sobriety…

in Top Stories by Lt. Charles Young II
August 18, 2014 1100

Madisonville Firefighters Recognized for…

in Top Stories by Rita Dukes Smith, SurfKY News Director
August 18, 2014 711

Hopkins Co. School Board Recognizes…

in Top Stories by Gary Gates, SurfKY News

Most Read Stories from Owensboro

August 18, 2014 2231

Owensboro Board of Commissioners…

in News by Beth Cecil
August 18, 2014 2128

Unlawful Solicitation

in News by Sgt. J.D. Winkler
August 18, 2014 2072

RiverArtes Opening at OMFA

in News by Owensboro Museum of Fine Art
August 19, 2014 1317

Free Arthritis Exercise Program will be…

in News by Woody Maglinger
August 19, 2014 860

Municipal Art Collection on Exhibit at…

in News by Mary Bryan Hood

Most Read Stories from Muhlenberg County

August 17, 2014 2984

Greenville Police Conducting Traffic…

in Top Stories by Wes Miller
August 16, 2014 2973

Pogue's Automotive Annual Picnic Brings…

in Top Stories by Charles W. Riley II, SurfKY News
August 18, 2014 2561

Man Injured in Early Morning WKP Accident

in Top Stories by Rita Dukes Smith, SurfKY News Director
August 18, 2014 1601

Luke's Flea Market Vendors' Home Away…

in Top Stories by Charles W. Riley II, SurfKY News
August 18, 2014 1584

'How Dry I Was'

in Top Stories by Rita Dukes Smith, SurfKY News Director

SurfKY News Group, Inc. Central Office & Printing Division
1125 Nebo Rd.  •  Madisonville, KY 42431  •  270.452.2249 (fax)
Main Number: 270.452.2727 (phone)  •  Printing Division Direct Line: 270.821.8600 (phone)

SurfKY Owensboro News Bureau
920 Frederica St. / Suite 210  •  Owensboro, KY 42301  •  270.683-8060 (phone)


Contact a member of our staff: www.surfky.com/contact
Copyright © 2014 SurfKY News Group, Inc.  •  Terms of Use  •  Site Map

social 06social 21social 22social 04social 03