My spouse (64) and I (52) have a child who is a sophomore in HS. We have no debt and are a one income family. I kind of thought we had college costs covered (I just wanted enough to pay for a state school), but it's now looking like our child would thrive more in a smaller private environment and I want to be prepared.
Almost all of our assets are in IRAs (Spouse- 1.3M in an IRA/401k, 150K Roth. Me- 570K in an IRA and 230K Roth) We currently have:
82K in a 529 (invested in all stocks)
25K in I bonds (earmarked for college)
3K in a brokerage account
15K in a HYSA
17K in HSA
Total excluding 529: ~2.3M
Spouse will have Social Security of 4100 at age 70. I will have around 1200 at 62.
Right now, my spouse is contributing 30,500 to his 401K plan and 8300 to the HSA. He may retire in a couple of years or next year, who knows. He isn't sure. Our net income is 67K a year and we mostly spend all of this.
We will probably spend around 75K-80K in retirement (including taxes).
When I run the NPC on a couple of college websites, it seems like we have to come up will around 46-49K a year for private college.
My questions are:
1) Should my husband be contributing so much to his 401K now? It seems like we have enough saved in our retirement accounts.
2) Should we divert that money into our 529 plan? Or do you think there is enough there already?
3) Or should be be saving more in cash/brokerage? We can always use it to pay the taxes on a Roth conversion, if that's recommended.
4) Can he even retire next year?
5) Should we be doing any Roth conversions? Or will that blow up our income too much for ACA subsidies?
I kind of think maybe #3 is the best option? It will up the amount we have to pay for school though, but I'm not trying to game the system here. I think we have too much in assets for that anyway. I suppose we can use my husband's Roth for additional college expenses if we need them, but I'd hate to do that in case we need a big chunk of cash for something important.
I'm not sure what steps we should take next and would appreciate any input. Thanks!![:)]( "Smile")
Almost all of our assets are in IRAs (Spouse- 1.3M in an IRA/401k, 150K Roth. Me- 570K in an IRA and 230K Roth) We currently have:
82K in a 529 (invested in all stocks)
25K in I bonds (earmarked for college)
3K in a brokerage account
15K in a HYSA
17K in HSA
Total excluding 529: ~2.3M
Spouse will have Social Security of 4100 at age 70. I will have around 1200 at 62.
Right now, my spouse is contributing 30,500 to his 401K plan and 8300 to the HSA. He may retire in a couple of years or next year, who knows. He isn't sure. Our net income is 67K a year and we mostly spend all of this.
We will probably spend around 75K-80K in retirement (including taxes).
When I run the NPC on a couple of college websites, it seems like we have to come up will around 46-49K a year for private college.
My questions are:
1) Should my husband be contributing so much to his 401K now? It seems like we have enough saved in our retirement accounts.
2) Should we divert that money into our 529 plan? Or do you think there is enough there already?
3) Or should be be saving more in cash/brokerage? We can always use it to pay the taxes on a Roth conversion, if that's recommended.
4) Can he even retire next year?
5) Should we be doing any Roth conversions? Or will that blow up our income too much for ACA subsidies?
I kind of think maybe #3 is the best option? It will up the amount we have to pay for school though, but I'm not trying to game the system here. I think we have too much in assets for that anyway. I suppose we can use my husband's Roth for additional college expenses if we need them, but I'd hate to do that in case we need a big chunk of cash for something important.
I'm not sure what steps we should take next and would appreciate any input. Thanks!
Statistics: Posted by winterfan — Wed Sep 11, 2024 4:12 pm — Replies 0 — Views 15