My DH and I have two debts:
1. 49K mortgage debt: I have to pay about $330/month with 4.875% interest rate.
2. 8K car loan. The payment is $272/month with a very low interest rate.
My Dh likes to give me some extra money to go to shopping or to have fun when his business does well. He also likes to buy bigger TV or other unnecessary items for pleasure but I told him I would rather use the money to pay off our debts. I will enjoy vacations more if we are free from debts.
I make $1330 monthly mortgage payment. The extra 1k is to pay toward the principle every month. I make extra payments whenever I can and I do it quickly before my temptation for spending takes over me
. We can afford to pay another extra 1k toward our debts this month. My Dh wants to pay off the car loan first, but I can tolerate 8k better than 49k. I think we should pay the mortgage because it has higher interest rate. We have not decided yet.
We have an emergency fund. My Dh and I plan to have a baby next year so I need to learn to be smart with money. Please give me some advice:
Should I focus on paying off the mortgage first or the car loan first?
How much do a regular couple need for rainy days in America? (I need a goal to save) The living cost in our state is not high. I am glad we do not live in California or New York.
How much fund is adequate for having a new baby added to the family?
My Dh told me he is not good with finances so he wants me to manage it, but I only know how to handle basic finances such as trying not to live beyond our means or to pay things on time. When people talk about IRA, 401k, or stocks, I feel so lost
. I saw people who are in their retirement years struggling with money and need assistance for food or medications. I feel deeply sorry for them, but I feel scared for my own future. Where should I start?
Thank you in advance for any input.