My wife (35) and I (37) have year old twins. We currently find ourselves pondering whether to have a third baby (ETA would be May 2025). Before marriage, and before the twins, I preferred two, she preferred three, but it wasn't a huge point of contention. I think, ultimately, we'd each be comfortable with either option. However, now that we have twins and the possibility of a third is out there, this decision is causing us a good deal of stress. It's not contentious at all; we're both just really set on doing what's right for us, and we ultimately don't know the answer. I'm hoping maybe someone here has some insight for us.
Right now it feels like we have great balance. We love our children and are able to spend time with them. We each get to exercise, see friends occasionally, do individual hobbies, do coupley stuff, etc. We would love a third child, but how much does that third child tip the balance? We don't want to be the bedraggled parents who never have tim for themselves or eachother, or even fully for their kids. For all of your parents of three our there, how was the transition from two to three? Especially if the older two would still be under two years of age when the third arrived? Any twin parents out here with specific advice on that front?
I would say we're leaning toward "yes" but are also nervous about the financial piece. It currently feels like we're living paycheck to paycheck. That's not really the case, as we're diverting thousands of dollars every month into various retirement vessels, but there's always a little balancing here and there at the end of the month. We have to keep an eye on it, but it isn't stressful, per se. When I do some back of the napkin math on a third child, that's where it starts to get dicey. We would certainly have to save less, maybe even none for a few years. We both love our jobs and have nice flexibility, though they're both government jobs, so pay increases will not coming in bounds. We expect an additional 2-3% per year. Anything extra is a nice surprise. But we don't want to find new jobs and don't want to work more.
My wife and I are both frugal. We've been good savers all of our lives. Of course we have our indulgences to spend money on, but we also always save a bunch. Since we have stable jobs and ~1.1M saved, I am not afraid of going broke. Rather, it's a question of whether we want to slow down our savings and retire at 60-65 with maybe 2.5-3M or keep plowing ahead and retire at 50-55 with 3.5-4M saved. And a question of whether the stress of knowing we're not saving anything for a few years is worth it. Even though I know we'll be fine, not saving flies in the face of everything we've always done.
So this post is largely about behavior and only partially about the actual numbers of finance. But here are the numbers:
Emergency funds: Yes - $40,000.
Debt: Mortgage ($280,000 owed for 27 more years at 3% - it's about $1700 per month) and one car ($640 per month, will be paid off in six months)
Tax Filing Status: MFJ
Tax Rate: 22% Federal, 5.75% State
State of Residence: Virginia
Age: 35/37
Salary: $117,000 and $63,000
Current assets:
Taxable - $650,000
Roth IRAs - $270,000
403bs - $170,000
HSAs - $45,000
Roth 457bs - $10,000
Virginia Retirement System - $28,000 available for refund - VRS Plan 2 - 12 years of service
Current monthly expenses (total $6400 before groceries, clothes, etc.)
Mortgage - $1700
Car - $640
Daycare - $3000
Insurance, taxes, utilities, etc. $1000
Current salaries $180,000 -> takehome is $134,000 or about $11,000 per month. But we save a bunch, $3,000+ per month, so our takehome really balances out with our expenses pretty well.
The big fear is that, with a third child, we are going to incur some additional expenses. Daycare will go to $4500, we'll probably upsize at least one of the cars, and our mortgage is going to increase. We currently live in a 2bed/1bath house of 800sf. At the minimum, we'd want 3/2, but as long as we're moving, this will probably be a forever home, so looking at 4bed/3bath. Mortgage would go to at least $3000. And this doesn't even consider a larger vehicle for one of us.
So suddenly expenses are more like $9200 without even considering groceries or day to day expenses. That's where it starts to feel really tight. Of course, the twins will be in public school in four years, so then we're clawing back $3000 in daycare expenses, and two years later another $1500 when the third would head to school. But for those few years it seems like we'd save basically no money! Can we afford to do so? If you were in our situation, would that make you go insane? I recognize we have a taxable account we can draw from in dire situations, but again, this is less of a question of if we can survive and more of a question of should we?
Thank you for reading this long post! I always appreciate the thoughtful responses here.
Right now it feels like we have great balance. We love our children and are able to spend time with them. We each get to exercise, see friends occasionally, do individual hobbies, do coupley stuff, etc. We would love a third child, but how much does that third child tip the balance? We don't want to be the bedraggled parents who never have tim for themselves or eachother, or even fully for their kids. For all of your parents of three our there, how was the transition from two to three? Especially if the older two would still be under two years of age when the third arrived? Any twin parents out here with specific advice on that front?
I would say we're leaning toward "yes" but are also nervous about the financial piece. It currently feels like we're living paycheck to paycheck. That's not really the case, as we're diverting thousands of dollars every month into various retirement vessels, but there's always a little balancing here and there at the end of the month. We have to keep an eye on it, but it isn't stressful, per se. When I do some back of the napkin math on a third child, that's where it starts to get dicey. We would certainly have to save less, maybe even none for a few years. We both love our jobs and have nice flexibility, though they're both government jobs, so pay increases will not coming in bounds. We expect an additional 2-3% per year. Anything extra is a nice surprise. But we don't want to find new jobs and don't want to work more.
My wife and I are both frugal. We've been good savers all of our lives. Of course we have our indulgences to spend money on, but we also always save a bunch. Since we have stable jobs and ~1.1M saved, I am not afraid of going broke. Rather, it's a question of whether we want to slow down our savings and retire at 60-65 with maybe 2.5-3M or keep plowing ahead and retire at 50-55 with 3.5-4M saved. And a question of whether the stress of knowing we're not saving anything for a few years is worth it. Even though I know we'll be fine, not saving flies in the face of everything we've always done.
So this post is largely about behavior and only partially about the actual numbers of finance. But here are the numbers:
Emergency funds: Yes - $40,000.
Debt: Mortgage ($280,000 owed for 27 more years at 3% - it's about $1700 per month) and one car ($640 per month, will be paid off in six months)
Tax Filing Status: MFJ
Tax Rate: 22% Federal, 5.75% State
State of Residence: Virginia
Age: 35/37
Salary: $117,000 and $63,000
Current assets:
Taxable - $650,000
Roth IRAs - $270,000
403bs - $170,000
HSAs - $45,000
Roth 457bs - $10,000
Virginia Retirement System - $28,000 available for refund - VRS Plan 2 - 12 years of service
Current monthly expenses (total $6400 before groceries, clothes, etc.)
Mortgage - $1700
Car - $640
Daycare - $3000
Insurance, taxes, utilities, etc. $1000
Current salaries $180,000 -> takehome is $134,000 or about $11,000 per month. But we save a bunch, $3,000+ per month, so our takehome really balances out with our expenses pretty well.
The big fear is that, with a third child, we are going to incur some additional expenses. Daycare will go to $4500, we'll probably upsize at least one of the cars, and our mortgage is going to increase. We currently live in a 2bed/1bath house of 800sf. At the minimum, we'd want 3/2, but as long as we're moving, this will probably be a forever home, so looking at 4bed/3bath. Mortgage would go to at least $3000. And this doesn't even consider a larger vehicle for one of us.
So suddenly expenses are more like $9200 without even considering groceries or day to day expenses. That's where it starts to feel really tight. Of course, the twins will be in public school in four years, so then we're clawing back $3000 in daycare expenses, and two years later another $1500 when the third would head to school. But for those few years it seems like we'd save basically no money! Can we afford to do so? If you were in our situation, would that make you go insane? I recognize we have a taxable account we can draw from in dire situations, but again, this is less of a question of if we can survive and more of a question of should we?
Thank you for reading this long post! I always appreciate the thoughtful responses here.
Statistics: Posted by SuperSaver123 — Tue Sep 17, 2024 2:20 pm — Replies 1 — Views 321