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Started By
Message
Advice
Posted on 9/10/17 at 3:16 pm
Posted on 9/10/17 at 3:16 pm
Long time lurker….normally keep my financials close to my own chest. I feel like I am a good saver but now I feel stuck on what my next steps financially should be.
Overview:
Married 29 years old (kid on the way)
Personal income $135,000 minimum (No OT) -- estimate $160,000 (OT) annual
Wife, looking for job (Just moved) Previous job $80,000 annual
Total Estimated total annual income of 2018-- $215,000
Current Retirement/ Investing Accounts:
Self- $24,000 in Roth IRA (vanguard)
$9,500 Traditional IRA (rolled over from former 401k) (Vanguard)
$5,500 (Vanguard Index Fund)
Wife-
Vanguard Roth IRA 11,000
Previous Employer 401k -8,000
Accomplished Goals
Out of Debt
$15,000 emergency fund in Money Market Account 1.2% interest
Purchased Disability Insurance
Current/Future Goals
Term life or permanent life Insurance?
Saving for House (20% down believer) –starting with next pay check
Partake in employer 401k plan starting 01/2018 -4% match + 5% profit share
Setting up backdoor Roth IRA?
Setting up/contributing to a 529 College saving?
Setting up more ETFs/Mutual Funds/Individual stock picking?
While I worked very hard to get to where I am today, I have some questions on what to do next. What type of life insurance should I get? Should I bite the bullet and meet with a personal advisor? Should I continue with Vanguard as my main retirement vehicle? Any suggestions are appreciated and will be open to answering any questions.
Overview:
Married 29 years old (kid on the way)
Personal income $135,000 minimum (No OT) -- estimate $160,000 (OT) annual
Wife, looking for job (Just moved) Previous job $80,000 annual
Total Estimated total annual income of 2018-- $215,000
Current Retirement/ Investing Accounts:
Self- $24,000 in Roth IRA (vanguard)
$9,500 Traditional IRA (rolled over from former 401k) (Vanguard)
$5,500 (Vanguard Index Fund)
Wife-
Vanguard Roth IRA 11,000
Previous Employer 401k -8,000
Accomplished Goals
Out of Debt
$15,000 emergency fund in Money Market Account 1.2% interest
Purchased Disability Insurance
Current/Future Goals
Term life or permanent life Insurance?
Saving for House (20% down believer) –starting with next pay check
Partake in employer 401k plan starting 01/2018 -4% match + 5% profit share
Setting up backdoor Roth IRA?
Setting up/contributing to a 529 College saving?
Setting up more ETFs/Mutual Funds/Individual stock picking?
While I worked very hard to get to where I am today, I have some questions on what to do next. What type of life insurance should I get? Should I bite the bullet and meet with a personal advisor? Should I continue with Vanguard as my main retirement vehicle? Any suggestions are appreciated and will be open to answering any questions.
Posted on 9/10/17 at 3:32 pm to LSUDogCat
Reread the numbers and think you're unsure of what the next year would bring. I would try to max 401k this year if possible and both do it next year. Wait to see about Roth eligibility depending on wife's job
This post was edited on 9/10/17 at 3:47 pm
Posted on 9/10/17 at 3:47 pm to LSUDogCat
I'd be curious to know what your wife does that's awesome pay
Posted on 9/10/17 at 4:01 pm to eye65
Appreciate the thought. I did not think about contributing that much to the 401k to make us Roth eligible.
Posted on 9/10/17 at 5:12 pm to LSUDogCat
Life insurance...........TERM
Definitely go with Vanguard advisor. Really good people to deal with. Less chance of getting taken.
Definitely go with Vanguard advisor. Really good people to deal with. Less chance of getting taken.
Posted on 9/10/17 at 6:30 pm to LSUDogCat
If you and your wife are making over $200k then you're in very solid shape. The problem most people have is lack of income. Your problem is having more income than you know what to do with - a very good problem to have.
The emergency fund is fine. Definitely get your other savings vehicles going though. ETFs and index funds are the way to go. Personally I like Schwab but Vanguard, Fidelity, TD Ameritrade and others are perfectly good too.
The emergency fund is fine. Definitely get your other savings vehicles going though. ETFs and index funds are the way to go. Personally I like Schwab but Vanguard, Fidelity, TD Ameritrade and others are perfectly good too.
Posted on 9/10/17 at 7:14 pm to LSUDogCat
There's just no way to post your income and not come off as a raging douche, even if you're looking for legit advice. If your question was what type of life insurance you should get and Vanguard retirement, I don't know why a step by step outline of your income is needed other than as a not so subtle brag.
Posted on 9/10/17 at 7:19 pm to TheWalrus
quote:
There's just no way to post your income and not come off as a raging douche, even if you're looking for legit advice. If your question was what type of life insurance you should get and Vanguard retirement, I don't know why a step by step outline of your income is needed other than as a not so subtle brag
One reason is he's going to be ineligible to contribute to a Roth so I'm guessing he's trying to figure out alternative savings vehicles
Posted on 9/10/17 at 7:53 pm to LSUDogCat
If your wife gets another $80k job, You may not be able to contribute to a Roth IRA straight up ($196,000 MAGI is the max). There is that back door option. I'm not familiar with it , though.
This post was edited on 9/10/17 at 7:57 pm
Posted on 9/10/17 at 8:23 pm to LSUDogCat
When you say "out of debt" - what's your debt?
Posted on 9/10/17 at 9:24 pm to LSUDogCat
quote:
I would try to max 401k.
Posted on 9/11/17 at 8:45 am to LSUDogCat
Ugh this is a hard one to figure out if you are serious or not.
2 posts with an account made this month.
Post reaks of all the right things to do by MT standards.
You make more than 97% of US tax payers and you are coming to TD for "advice."
The only thing that stood out is how have you not come up with 20% yet? Unless you are looking at buying a million dollar home. Which wouldn't surprise me given your post.
I would pay a professional to look at your accounts if you are serious.
2 posts with an account made this month.
Post reaks of all the right things to do by MT standards.
You make more than 97% of US tax payers and you are coming to TD for "advice."
The only thing that stood out is how have you not come up with 20% yet? Unless you are looking at buying a million dollar home. Which wouldn't surprise me given your post.
I would pay a professional to look at your accounts if you are serious.
Posted on 9/11/17 at 12:06 pm to 50_Tiger
quote:
I would pay a professional to look at your accounts if you are serious.
See my post above. This is not advice.
Should the OP see a dentist? A dentist is a professional. Maybe an architect?
Posted on 9/11/17 at 12:43 pm to LSUDogCat
IMO, I'd say the following:
1) you haven't been putting near enough back into retirement accounts. I'd make sure you put 15% of YOUR money (not counting matches, sharing, etc.) Since you area bit behind, I'd probably suggest 20-25% for 5 years or so. I think if you put at least 15% in your traditional 401k to lower your taxable income, you should be close to qualifying to max out the ROTH IRA at $11k/year. That would put you around 22% retirement savings rate for now.
2) If you are living anywhere near your income levels, your emergency fund isn't near enough but you also have 2 incomes. I might see this as more important for me since I am feeding a family of 5 on a single income. I'd think your emergency fund should be closer to $30/35k but if you are in a small house, maybe not.
1) you haven't been putting near enough back into retirement accounts. I'd make sure you put 15% of YOUR money (not counting matches, sharing, etc.) Since you area bit behind, I'd probably suggest 20-25% for 5 years or so. I think if you put at least 15% in your traditional 401k to lower your taxable income, you should be close to qualifying to max out the ROTH IRA at $11k/year. That would put you around 22% retirement savings rate for now.
2) If you are living anywhere near your income levels, your emergency fund isn't near enough but you also have 2 incomes. I might see this as more important for me since I am feeding a family of 5 on a single income. I'd think your emergency fund should be closer to $30/35k but if you are in a small house, maybe not.
Posted on 9/11/17 at 1:17 pm to UpstairsComputer
I just came hear to spit ball ideas with people. I'm not going to take everyone's advice but like I said, I'm a long time lurker and feel like a lot of posters on this board have a lot of good ideas.
Posted on 9/11/17 at 1:44 pm to LSUDogCat
Don't worry about those comments. I've wanted to start a thread asking for some ideas, but am not comfortable posting my details and risking the "subtle brag" bullshite.
As to your situation, I'm surprised at how low your retirement savings are based on your income. You either live well and have a few toys, or your income is a more recent event. If the latter, how stable or certain is your income?
As to your situation, I'm surprised at how low your retirement savings are based on your income. You either live well and have a few toys, or your income is a more recent event. If the latter, how stable or certain is your income?
Posted on 9/11/17 at 2:44 pm to Spirit of Dunson
quote:
Don't worry about those comments. I've wanted to start a thread asking for some ideas, but am not comfortable posting my details and risking the "subtle brag" bullshite.
As to your situation, I'm surprised at how low your retirement savings are based on your income. You either live well and have a few toys, or your income is a more recent event. If the latter, how stable or certain is your income?
I hate to interject (again) into the OP's thread, but there are quite a few folks who knock out student loans after attending graduate/medical/professional school then start saving for retirement. With interest rates of student loans at or above nearly 7%, it isn't that bad of an idea, right?
I am in a similar situation as the OP. When I started earning money, my company didn't offer a 401k match (they funded a pension instead), so that's what I did--knocked out a small amount of student loans initially then started retirement savings.
Now, I am hitting 401k hard. Maybe I put myself behind a bit, but I feel like I did the right thing. God forbid I would have asked for advice on this board.
Posted on 9/11/17 at 2:46 pm to schwartzy
quote:He makes double what his wife did, but you're more interested in what she does because of the "awesome pay?"
I'd be curious to know what your wife does that's awesome pay
Posted on 9/11/17 at 2:58 pm to lnomm34
quote:
Then make a recommendation for someone that he should speak with.
Fair enough. And you're right, I could've been more helpful than to dogpile on the other comment. For that, I apologize. It wasn't me who said anything about validation.
At a minimum, I'd look for someone with a CFP - this guarantees they've at least made it 3 years and have some experience. I'd avoid banks and wirehouses. I agree with your comment on NWM, and I'd lump in New York Life and other primarily insurance companies in with them.
When you meet with someone ask them the simple question: What is the breakdown of your commission based (mutual funds, private offerings, annuities, and insurance) vs. fee based revenue? Preferably <5%, but anything over 10-15% commission based products would make me very nervous and I'd want to know their explanation. It would indicate to me they were still, at least partially, in the "eat what you kill" stage of their career or that's just how their firm works and how they were trained.
Then ask the exact same question for assets under management. This range can be a little higher because once an advisor can go fee based, it may take some time to transition the business from those legacy assets. Preferably <25%, but not over 30-40%. This would indicate rotation in a particular advisor's career and you want someone who is either in this stage or passed it.
Finally, the reason you want a fee based advisor, despite what the interwebs say, is you can fire them tomorrow if you decide you're unhappy and not pay an arm and a leg to break up with them.
While it doesn't appear kosher to pump a brand on here (other than Vanguard ), I'll leave it at, you can search these forums for other recommendations.
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