succumbing to peer pressure

Monday, February 26, 2007

Advice! (thanks in advance!)

First - Financial Gurus:
Next year I'll take a whopper of a hit come tax time, because my university chooses to dole out my entire NIH training grant money each month and leave me to pay all the taxes all at once in April. So, I'm math-savvy enough to figure out that I should be socking away $250-$300 each month to avoid crying in April '08, but is there something 'better' I can do with that money besides just slide it into my savings account and pretend like it doesn't exist? I know in the world of investing and interest rates a few hundred bucks probably isn't worth anything, especially over just 12 months (or fewer) but thought I'd look for suggestions anyway.

Second - Technical Gurus:
So my grand plan was for my laptop to hang in there (along with my car) until I entered the working world. But the poor 6-year-old Dell is showing signs that she may be closer to her last legs than I'd prefer. The main reason I've been clinging to such outdated technology is that I don't really use it much anymore for heavy lifting - the only work-related stuff is simple word documents and otherwise it's just an internet machine. Given the nature of my field, I suspect that this will continue to be true, regardless of what sort of future job I get (large datasets and time-consuming programs are best run on company-provided fancy-schmancy machines), but I won't be able to know that for sure until, duh, I'm hired somewhere. So, if I knew what I was looking for, I'd be able to comb through various online reviews and make some decisions...but since I can only guess at my future needs, I'm a little lost. Any suggestions for a reasonable baseline set of features to cover most of my bases?

And lastly, my idiot bill this month is getting extravagant - $22 for two tickets to a concert I didn't attend (and should have been able to predict I wasn't going to go), $3 because I forgot my oil change coupon this morning, and $3 more because I left my coupons sitting my back pocket while checking out at krogers this afternoon instead of handing them to the nice lady to ring up. Blah.


Blogger Sudiptya said...

Ditch the tax money in an Emigrant Direct savings account. You'll get over 5% interest, which beats any traditional savings account and most money market accounts and it'll still be liquid enough for you to withdraw the money whenever you need it. That'd be my recommendation.


4:43 PM  
Blogger Megan said...

Sounds good, but since it's a variable interest rate, what are the odds of ending up doing worse than a standard savings account over the course of a year?

6:49 AM  
Anonymous Anonymous said...

Shouldn't you be paying quarterly estimated tax payments, since you owe taxes on income that isn't having witholdings? That's what I have to do for mine. When I didn't the first year, they hit me with penalties.


8:37 AM  
Blogger Sudiptya said...

It is variable interest rate, but I've had it for years and it's always blown traditional savings accounts out of the water. If you're paranoid, go with a CD or money market account.

10:48 AM  
Blogger Megan said...

Steve - excellent question. I guess I need to contact the IRS again? And if that is the case, shouldn't my institution send me quarterly paperwork? Or do I have to request that?

Sid - not paranoid, just curious. And I guess if it did start tanking, I could always slide things back over into a traditional savings account. Do you have a strong preference for Emigrant vs. ING vs. something else?

2:24 PM  
Anonymous Anonymous said...

Here is the IRS FAQ about estimated tax payments: IRS.

And no, typically the university says "your tax situation is your own problem, its up to you to do the right thing", and the IRS won't proactively make an issue of it. You have to know to do the right thing.


9:43 AM  

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