Married 38f ($109k/year salary) to 41m ($140k/year salary). Husband has $210k in his 401k account. I have $90k in mine (I'm aware that I am behind but working on catching up). I am contributing $1,500/month to mine and he contributes $1,800/month to his.
Current finances:
No debt other than our mortgage. Monthly expenses/bills/groceries currently comes to $5,870/month. That will go down to $4,690/month come August (adios daycare expense). Our combined take home is $12,400/month. Our current emergency savings is $30k (we just paid a big tax bill and medical expenses along with a vacation so it's lower right now).
I know we are behind in retirement savings and it's stressing me out. We also plan on contributing to a taxable brokerage per month as another retirement vehicle starting next month.
Are we on the right track or fu*ked?
Financial Plannng – How are we doing?
byu/Particular-Bus1744 inpersonalfinance
Posted by Particular-Bus1744
7 Comments
Well it heavily depends on how you expect to live in retirement and when. But in general not fucked but given current incomes id definitely say a bit behind where you should be assuming you have no other tax deferred money (hsa/roth/etc). You will be just fine though if you continue as you are going. Generally just remember order of operations though
401k match
Max HSA
Max Roth
Max 401k
The key is balance. Think of investments, retirement and savings as essential spending for future self.
If you max out everything, pay taxes you may be making your current self unhappy. If you don’t manage current spending, you’ll make your future self unhappy. Key is finding balance and making it automated. The balance that works for you. Reddit can’t advice.
Do you have iras? HSAs? 529s?
Your current spend is $5,870/mo. Your current gross is $20,750/mo. You contribute $3,300/mo to retirement accounts. Where’s the other $11,580/mo going besides taxes and healthcare?
Based on what you’ve provided there seems to be room to increase retirement contributions, especially HSA and Roth.
Compound Interest Calculator:
Current Amount: $300k
Annual Addition: $40,000 (add any increase to taxable and any company 401k match)
Years to Retirement: 25
Rate of Return: 7% (inflation adjusted return)
Future Value: $4.3M in today’s dollars which should be enough to cover your spending + social security.
So you are stressed out about being behind in retirement savings, but you’re only saving 15% of your income. Ok.
You dont need a taxable brokerage account. You make enough to max out all tax advantaged retirment accounts. Just do that.
not with those incomes you are not, unless you live in a very high cost of living area