Married, late 30s, MCOL area.
Current Savings:
$530k in 401k (~40k of it is Roth)
$32k in Roth IRA
$140k in taxable account
$60k in cash balance pension
Current debt:
$240k in 2.9% mortgage
$105k in 5% home addition loan
Income:
230k gross with additional 0-45k annual bonus
Expenses:
~82k a year - High, looking at some cost savings to reduce this. This is just to maintain current lifestyle, but does not include extra "fun money" on expensive hobbies.
Additional savings:
Him: 23k to 401k annually
Her: 14k to 401k annually
Company match: 12.6k to 401k annually
Company contribution: 7k annually to Pension
Taxable: 5.2k annually to SWPPX ($100 a week)
Taxable: 14k purchase of company stock at 15% discount and immediately sold to purchase SWPPX (semi annual purchase, 7k per 6 months)
We currently spend on things that we would like (dining out, vacation, hobbies) but would like to focus more on saving. Long term, we would like to retire before 50 and position ourselves to have that become a potential option. When starting to cut out extra fun money and put towards saving, where should this go?
Options:
-Pay towards 105k loan at 5%. Percentage rate is right at that point where it may or may not be worth it to do this.
-Max her 401k pretax to the annual limit of 23k. If trying to retire before 50, wondering if it makes more sense to put in taxable instead?
-Put direct in taxable account - VTI or SWPPX
-Put additional in his 401k after tax account and immediately convert in plan to Roth 401k. Same dilemma as her 401k, would taxable make more sense?
What would you all do with additional income? If the goal is to retire early, should a heavy focus be to save into the taxable account so we would have accessible funds to pull from? Or a combination of some of the above options or other ideas?
Current Savings:
$530k in 401k (~40k of it is Roth)
$32k in Roth IRA
$140k in taxable account
$60k in cash balance pension
Current debt:
$240k in 2.9% mortgage
$105k in 5% home addition loan
Income:
230k gross with additional 0-45k annual bonus
Expenses:
~82k a year - High, looking at some cost savings to reduce this. This is just to maintain current lifestyle, but does not include extra "fun money" on expensive hobbies.
Additional savings:
Him: 23k to 401k annually
Her: 14k to 401k annually
Company match: 12.6k to 401k annually
Company contribution: 7k annually to Pension
Taxable: 5.2k annually to SWPPX ($100 a week)
Taxable: 14k purchase of company stock at 15% discount and immediately sold to purchase SWPPX (semi annual purchase, 7k per 6 months)
We currently spend on things that we would like (dining out, vacation, hobbies) but would like to focus more on saving. Long term, we would like to retire before 50 and position ourselves to have that become a potential option. When starting to cut out extra fun money and put towards saving, where should this go?
Options:
-Pay towards 105k loan at 5%. Percentage rate is right at that point where it may or may not be worth it to do this.
-Max her 401k pretax to the annual limit of 23k. If trying to retire before 50, wondering if it makes more sense to put in taxable instead?
-Put direct in taxable account - VTI or SWPPX
-Put additional in his 401k after tax account and immediately convert in plan to Roth 401k. Same dilemma as her 401k, would taxable make more sense?
What would you all do with additional income? If the goal is to retire early, should a heavy focus be to save into the taxable account so we would have accessible funds to pull from? Or a combination of some of the above options or other ideas?
Statistics: Posted by T700k — Sun May 26, 2024 3:27 pm — Replies 0 — Views 73