Mellen Money Management LLC
Principal, Financial Planner
After spending much of my 10-year career advising $44-million in client assets for a large regional bank, Scott Snider decided it was time to break away from corporate America and start a fee-only financial planning firm named in memory of his Grandparents. Mellen Money Management embodies their generosity and serve-first values. Today Scott's firm works with clients in the Jacksonville, FL and Columbus, OH markets and offers virtual meetings for those that live on the other side of the country. In fact, several of Scott's clients live around the globe.
Mellen Money Management provides investment management and comprehensive financial planning, with an emphasis on understanding the impact of key life transitions on your money. In addition, Scott specializes in helping young professionals and families navigate the confusing maze of college tuition, financial aid, and student loans. It's Scott's mission to ensure you are not letting the astronomical cost of college manage you. More importantly, he believes this problem can't be solved in a vacuum and should be balanced with the many other financial goals that compete for your money. Please explore the Mellen Money Management website, check out the blog, or contact Scott to learn more.
BS, Finance, Miami University
Assets Under Management:
Who is Mellen Money Management
Looks like you have plenty of well-qualified advisors to pick from. A lot of good advice has already been written. At any rate, I'll offer you my take...
Trust is the foundation of every great relationship. Be sure you listen to your gut if something seems "off" about the recommendation you received. I encourage my prospective clients to get a second opinion whenever they are at a key transition point in their life. Ultimately, it's about what's best for you, the client. Even if you just need validation with the current plan, it's smart to do your due diligence before handing your life savings to someone else to manage. At the end of the day, it is the advisor's job to provide you a clear path on how to achieve a successful plan, and then instill the confidence in you to make changes where necessary.
Having previously worked at a brokerage firm and bank, I have a good grasp on varying investment philosophies, including market-driven and insurance-based. It's easy to say one is better than the other if you "sell" or "service" only one particular way of thinking. However, both investing strategies can be beneficial to the client when positioned properly. It really boils down to what features you value the most. I am a fee-only planner, but I think there are plenty of great advisors who work on a commission basis and do right by their clients. Unless the fee-structure totally disagrees with your value system, don't rule someone out solely based on their compensation model. Try to find someone who you believe will put your best interests first. Getting there is really about finding a good fit for both parties more than anything else.
Feel free to message me if I can be of any help. Good luck!
$1,000 per month in savings is substantial enough that I would strongly lean towards paying off the 401(k) loan. Furthermore, the $39,000 loaned from your 401(k) is being used as collateral and sitting in cash. Therefore, you allow that money to go back into the market and generate better long-term growth. Additionally, should you ever leave your employer, you are required to pay off the loan within 60 days of the date you resigned. In the event you don't have the cash to pay off the loan within that window of time, the money in your 401(k) is used to pay the remaining balance in full. This triggers a taxable distribution and is subject to the 10% IRS penalty if you are under the age of 59 1/2. In general, anytime you can wipe out a loan against a 401(k) is a good idea. Regarding the emergency fund, just make sure $15,000 is enough to cover at least 3 months worth of living expenses. As a general rule of thumb, it is wise to keep 3-6 months available in cash. Any gap should be made up pretty quickly with the $1,000 in savings from paying off your 401(k).
Glidepath funds (AKA Lifecycle funds) are great for the investor who wants to put their retirement investing on autopilot. Lifecycle funds are meant to adjust the asset allocation from more aggressive to more conservative as you approach retirement. In other words, there is a gradual shift from a growth strategy to a preservation strategy. You get professionally managed pre-allocated portfolios when you choose this option. On the other hand, picking your own allocation is good for the investor who knows what they are doing, or has a financial advisor assisting them by matching the fund mix to their risk tolerance and overall goals. Ultimately, it comes down to your comfort level and experience as an investor. If you choose to customize, I would over-weight towards more growth-oriented funds like equities and real estate, and then mix in a little bit of fixed income. The caveat to that is if you are a more conservative investor, then you should consider doing more of a 50/50 split of equities and fixed income. I hope this helps!
Having spent 6.5 years working for a large regional bank (2 of those years as an Assistant Branch Manager), I can confidently tell you that a credit score in the mid to high 700s will land you in the great to excellent tier. I recall 740-779 being the cutoff for great and 780+ being the cutoff for an excellent credit score. Most of the time the difference between great and excellent was negligible in terms of interest rate, so I wouldn't sweat it too much. Really anything at the great or better level meant the borrower was typically getting the best rate offered. An excellent score allowed for more leeway in terms of loan-to-value ratios and enhancing the terms of the loan. The best thing you can do for your credit is to continue paying your bills on time. Having a high credit potential (credit card limit) to balance (carrying a $0 balance) ratio is also very heavily weighted. More so than the average account age. Therefore, I would consider applying for the credit card and paying the balance off every month. The hard pull on your credit is only a temporary hit, while the benefits of increasing your credit potential will help to raise your score in the long-run.
Loan payments do not count against your annual contribution limit to your 401(k). Therefore, you can both max out your 401(k) contributions and pay back your loan at the same time. Make sure you don't run into any "testing limits" when you go to max out your 401(k) contributions. Also, you can call the plan admin and inquire about it, should you be concerned.