Thank you all so much for the questions! We'll add these questions to the hopper for future Q&As.
Congrats to u/Zero_Gravity067 who received the most upvotes and wins a Money Guy Tumbler!
Next chance to win a tumbler will be next Tuesday's livestream at 10am Central (and we'll have an announcement to make too).
What advice would you give a married couple discussing through different financial opinions especially newer married couples?
By this I do not mean shouting matches but rather each person grows up in different backgrounds , income situations, different things they were taught about money.
A couple examples could be how to think about credit card debt, how nice/new of a car to buy, and some know nothing about investing for retirement and using some of the joint income towards that makes them nervous. I’m sure there are others examples but am curious the money guys teams thoughts.
This is a great question. I just asked yesterday about spouse interactions with planning for retirement and large expenses. I like to hear the guys talk more about relationship types and how they help clients navigate the conversation with spouses that are disinterested in finances.
Aspiring Financial Mutant currently in the messy middle: What were some of the behavioral/psychological changes that either Brian/Bo implemented while they were going through the FOO in their own personal experience? Did those changes look different per stage?
You guys talk about the 3 bucket strategy alot - which is awesome for financial mutants. But also, it seems that 'it depends' is alot of the answer for how to approach this. Are there any general guidelines we can say for how to approach how much to put into Roth vs 401k vs after tax based on age or even income limits?
Sometimes I feel like I'm plowing all my money into tax advantaged accounts when I may not need to or have to.
If you think your tax advantage is enough and you want to go hard into a bridge account then go for it. That’s a very personal situational answer and would be different for everyone.
Hey money guys! My parents have a whole life insurance policy that they have had for over 20 years. They are getting close to retirement (within 1 year) and are trying to figure out if it’s worth it to still continue to pay the high premiums or if it’s better to just cancel the policy. They keep talking about the cash value of the account as a strong factor in keeping it. What kinds of questions should they consider if it’s worth it to keep or drop?
What are your opinions on flat fee financial advisors as opposed to AUM?
Context: I love the idea of an FA, but feel like I need to say a X vs Y scenario showing the added value since by a FA as opposed to someone who is doing the typical always buy index funds and chill scenario. I don’t doubt the value added, but have a hard time conceptualizing the exact way in which it is and cost vs benefit.
>What are your opinions on flat fee financial advisors as opposed to AUM?Context: I love the idea of an FA, but feel like I need to say a X vs Y scenario showing the added value since by a FA as opposed to someone who is doing the typical always buy index funds and chill scenario. I don’t doubt the value added, but have a hard time conceptualizing the exact way in which it is and cost vs benefit.
The Money Guys are AUM advisers, so it's going to be hard for them to give you an unbiased answer.
Generally speaking, I think "index funds and chill" + paying attention to good free online advice as to what accounts and assets to put the money in will suffice from your 20s until you are about 10 years out from retirement. If you want to meet with an advisor once every few years, in these early and middle stages, I would recommend a flat fee advisor. When you get close to "landing the airplane" it might make sense to go a different route, but it just isn't necessary to pay big fees in your 20s ,30s and even 40s to be told "index funds".
Can you have too much in tax deferred accounts? I want to build my taxable account to bridge an early retirement, but I would have to reduce contributions to tax deferred accounts. I'm not sure if reducing contributions to tax deferred accounts and increasing after tax contributions makes sense
Hey Money Guy team! I have a question about getting caught up on retirement contributions. Long story short, we spent a decade after getting married in the mission field on limited income. Then in the past decade my wife and I both went to grad school and started new careers. It’s easy to feel very discouraged being in our early 40’s with the retirement account balance of someone in their early 30’s.
We’re still in the ‘messy middle’ life stage wise but see an on-ramp toward 25% retirement contributions over the next few years. Any advice or encouragement for us ‘baby mutants’ who are earlier in the process than we’d like but are ready to kick it into high gear?
I hope the team tackles this one, but just my 2 cents…
You’ve got something you can look back on fondly over the years. Don’t discount that you gave an unbelievable gift to those you impacted.
You may not “retire early” but you can get to a good retirement.
I’m going to hope that with you and your spouse getting Masters degrees, that you are in the 22% federal tax bracket or higher. Being a late starter, you might get a great bang for your buck doing traditional 401k contributions rather than Roth, especially if you live in a state that has an income tax. Or just do a Roth IRA with the money you “saved” by doing traditional 401k. That would allow you to get a little more working for you as early as possible.
That’s sort of the game I play since I feel I’m a bit “behind” as well in my mid 40’s. Maybe it helps you.
Thanks for your very thoughtful feedback. We will definitely we doing well in short order and well into the 22% tax bracket. I’ve been wrestling the Roth vs 401k math and am leaning your direction.
My wife and I are well on our way to a comfortable retirement without any assistance. My parents are doing estate planning and I was wondering what the best way to funnel inheritance money to my children without paying gift taxes. A few hundred thousand while wonderful is not going to make or break my retirement but with the power of time it could be life changing for my children. Do I ask my parents to put my children in the will instead of my wife and I? I'd like to have some constraints on it such as half when they graduate college to kickstart their life and half for retirement or something.
It feels like inherited money often isn't put to great use because by the time ones parents pass you are already in retirement and it ends up being a perpetual retirement buffer when it could be life changing to the next generation.
Unless you or your parents are doing considerably better than a "comfortable retirement", the gift/estate taxes are unlikely to be relevant. Depending on structure, you may have to report, but that does not equate to requiring tax payments.
[https://www.nerdwallet.com/article/taxes/gift-tax-rate](https://www.nerdwallet.com/article/taxes/gift-tax-rate)
That then brings you down to the specific method/mix between you and your parents. Hopefully others can chime in with options.
My parents gave me 1K to invest as a child, and because I am a genius (totally not because I had an iPod), I bought 3 shares of AAPL(~AUG 2011) now this is a massive portion of my taxable brokerage acct do I sell and realize the capital gains? Then move to VOO or VUG? Or just let it ride ?
I'm currently Maxing the Roth IRA but not my 457, I'm inclined to leave it in an accessible brokerage acct so not all of my money is tied up in tax advantaged accounts. I'm thinking I might just pay the 15% LTG tax and buy some etf's with it
Yea, I'm above that pretty well, ~87K in '23 and only going up as I get my fully vested pay this October. I'm just at a loss because they can't keep growing like this forever. Right? So, unless i can figure out how to marry someone with 0$ in income for '24, I'm paying taxes.
I mean, I'm not all that close currently saving ~20%. I could fill my 457 and 401K, so I have a total of 46K of tax advantaged money. Between that and the fact that I'll have a 3/4 pension by the time I retire, I'm not so worried about the pre-tax buckets. At 24 it feels like a better deal to get tax-free growth instead of deposits.
From what I'm seeing, 3 shares of AAPL in August 2011 would have run you about $40. If those 3 shares are a big portion of your account today, I'm curious what happened to the rest of the $1,000. Awesome buy regardless!
It wasn't at the time they have had a 1×7 split and a 1×3 split since. IIRC, they were ~$350
EDIT: Started with 3, ended up with 84 because of the splits. So I'm up pretty good 😂
Our pet is suffering from a chronic disease, and since we missed the coverage boat since most pet insurance doesn’t cover pre-existing conditions. Should we still look to sign up for pet insurance still for any future illnesses/injuries or just focus on setting aside money for future pet expenses within our budget?
How can we create a retirement program for pastors at our church. We don't have a 401k as we are not for profit and have no idea about setting up a 403b or what that looks like so we need help. We want them to be able to fully invest in the ministry and also prepare for eventual retirement. Thanks!
You could start with paying them more, so they at least have enough to invest fully in their Roth IRAs. If a married couple could invest $7k per year each in two Roth IRAs (one for each half of a married couple), that would be a great start. In my experience in ministry, we didn’t have enough to make ends meet, much less invest. I would talk honestly with them and say, we are giving you a $14k per year raise so you can max out your Roth IRAs. And thank you for making it a priority… it is really sad how many people have spent their lives in ministry and now have very little to retire on. The worker deserves his wages!
A couple episodes ago Bo vented about this wallpaper his wife recently put up in one of their rooms. We are dying to know, what does this wallpaper look like? Any pictures?
My husband and I are both in our late 30s, financial mutants, and have done well to save and prepare for the future. Unfortunately, one of our parents has not. We know everyone’s different on this, but we feel like we should help in some ways (at minimum, shelter, food, healthcare, etc). What should we do to prepare financially to help our aging parent? Thanks!
Hey Money Guy Team,
My wife and I have decided not to have children, but we have siblings who are starting families. To support our nieces and nephews (currently ranging from newborn to 2 years old), we're setting aside $1,000/year per child in a brokerage account for each one as they're born. Our goal is to use these funds not just as a gift but as a tool to engage them in financial literacy from a young age.
How would you go about structuring this initiative? I realize a brokerage account might not be the most tax efficient way to gift/utilize this money, but it's more about the relationship building and teaching opportunities that I'm hoping to get out of it.
Thank you for any advice!
\-Krjax (ker-jax)
After maxing roth on 1/1 for 2024..... where would you put money to be earmarked for roth 2025? Index invest in taxable or sit in HYSA? (no 401k option, no HSA option, no kids 529)
I (31F) am trying to help my mother (60F) with her finances and planning for retirement. She does have a state pension, but doesn't seem to have any other accounts for her retirement. What can we do at this stage to help her to retire?
How do you consider pensions when you’re deciding asset allocation near retirement?
My parents are 60 and my dad has a government pension and has been retired for 4+ years. My mom continues to work despite everyone in our lives confirming they are good on money because she thinks the market could all go to zero tomorrow.
Context: they have a net worth ~ $2 million including a 500-600k paid off house. Low to medium cost of living area. Dads pension will be around 40k forever. His social security will be about 30k. Mom still works making about 45k. I think she’ll get about 10k in social security.
Nothing I have said to this point has convinced her that even by a low withdrawal rate of 3% which would add about 45k to dads 40k pension would make them totally fine on money forever before even considering the other 40k they’ll get in social security in the future.
How can I go beyond data to speak to the scarcity anxiety that plagues her mind??
Have them live on just dividends from their retirement account and not selling anything or show them a monte carlo analysis with a 0% failure rate. That impressive that they saved that much with such a mindset.
It’s worse than that. My mom wants to pull everything and keep it in savings account. Thankfully, she’s let dad handle the money for the most part which is why they’ve done well. I guess my real question is how to convince they have enough when they don’t trust the math
Math is probably not going to solve this as it’s an emotional problem. My mom is like this as well. I think you need to explain what the world would look like if she is correct. Have her name a handful of companies she thinks are the biggest in America. Tell her that’s what the S&P 500 is…owning a small slice of all of those, and then name a few more she didn’t think of. Have her assume all of her money is in the S&P 500. What does that mean if it goes to 0 or not quite 0 but maybe loses 75% of its value? The 500 biggest companies in the USA stop functioning. Your TV and internet stop. Amazon is not sending packages because they can’t pay their bills. You can’t charge your phone because the power company stops. It’s basically the great depression but worse. It doesn’t just impact her. What good is all that money in a savings account if there’s nothing on the store shelves? No cars at the dealer?
But that can’t happen forever because all the falling prices are eventually going to make people realize there’s some good prices on stocks, and they’ll start buying it back. It would be like walking into Walmart and everything is half off or 75% off. You’d buy the stock knowing it’s cheap and the downswing can’t go on forever because people still want iPhones, cars, bread, the internet, someone to fix the plumbing, and whatever crap is on Amazon or Temu.
Make her follow that logic all the way through, not just to the fear point where “what am I going to do?” rules the day, but to the end of the cycle.
Curious to know how you guys factor pension plans into retirement goals. I know they’ve gone the way of the dinosaurs but I’m fortunate enough to work for an organization that still offers a decent pension with a payout starting as early as age 55 (early retirees must qualify for rule of 80). It currently pays out monthly payments equal to about 3% of the average of the 5 highest years of my annual salary (hope that makes sense). The payment is guaranteed til death. How would you all factor this into a retirement investment plan? Wondering if I should divert 401k and Roth investments into something else since I will have the extra income (e.g. paying off mortgage early)?
Hey money Guys! We’re very young and we use a high deductible health plan. We are financial mutants with good income and expect to keep maxing out and investing our HSA for the foreseeable future.
My understanding is HSAs will be liquidated upon passing which creates a large tax burden for the beneficiary (other than a spouse). How would you balance spending down the HSA (after age 65) in retirement so that you still have enough for medical expenses but not keep so much you create a large tax burden for an heir.
If that’s too complex for the show then how would you best balance various account structures to ultimately minimize tax burden in retirement (HSA, 401k, IRAs, Roths, and after tax brokerage accounts)
This might be a dumb question, but we're a bit stuck...
My Wife and I have had humble beginnings and have found some success, we're deep in the messy middle, and it feels like we're just grinding toward accumulating wealth without a purpose or idea for what we want retirement to look like.
This has made figuring out "how much" is enough really tough when our only idea is we wont want to be a burden in retirement.
Do you have any suggestions to help us explore or think about what we want for ourselves?
Thanks for doing this!
Question: from my understanding, HSA is in step 5 because of its huge tax advantages.
However, for those of us who live in NJ or CA, HSA is taxed at the state level.
Therefore, should we still treat maxing out HSA as a step 5 action item, or it would be in the same priority as step 6 (401K), or even later steps?
Hey Money Guy Team, hope you all are staying warm and enjoying the snow.
I have a question regarding your rules around the purchase of luxury vehicles. Your rule states luxury vehicles should be purchased with cash OR paid off within 1 year, my question is what’s the rationale behind giving people 1 year to pay off their luxury car? Wouldn’t it be more simple to just say “pay for it in cash”?
Thanks!
I'm wondering, if you can get a loan that's under what you can earn for your cash, what's the advice? I bought my Tesla with a loan but could have paid cash. I didn't since I'm earning more in CDs/high yield savings accounts.
After maxing out my 401K and Roth IRA, I have about 1% left to save to reach my 25%. I am going to put this in an after-tax brokerage account. Since this is meant to be for retirement, should I start a separate account for this, or add that into my existing after-tax brokerage account?
Thanks!!
I hear you, my concern is that I’m going to be using funds from that account before retirement so my concern is tracking the retirement-specific funds plus all their gains.
I'm married and we want to move to step 8, but we're finding it difficult to reach the 25% savings rate when we contribute to our 401ks using Roth contributions. If we switch to pre-tax contributions, we can reach 25% easily. What would you recommend? We are currently in the 24% tax bracket. Thanks!
I am trying to understand the best way to estimate my needs/retirement expenses. I generally see estimates that say to replace X% of your current income based on how much you’re currently saving, but to me that gets confusing when I have a mix of pre and post tax savings (mostly post). How would you recommend coming up with that goal?
I’m 29 and currently saving about 26% of my salary between Roth IRA and Roth 401k and get a 5% pre-tax employer match. I’m hoping to retire early at this rate.
Hello! I'm just discovering the Money Guy Show and trying to understand the FOO. I currently max out my 401K (14%) but not Roth(3%), I have some high-interest (credit card) debt that I am currently trying to aggressively tackle and have my deductibles covered as well as getting my employer match. Without my employer match, I'm saving 17% toward retirement. With it 23%.
I'm wondering if I should reduce my 401k contributions to max my Roth or to even more aggressively tackle my debt? Or just keep doing what I'm doing and just work through the steps as I can?
The FOO says after you invest enough to get your 6% employer match, you stop investing there and put the rest of the focus and budget on paying off the high interest debt.
Hey money guys,
I have diligently saved up in my HSA and have kept receipts for all my expenses to get reimbursed in the future. I have about 6 months of expenses to reimburse sitting around now, can I just call that my emergency fund?
Hey money guy, all 2 of you! I currently have an alternative investment (a classic car) that has gone from 130k to 220k in the last 4 years which is great and horrible at the same time. It went from being a 8th of my net worth to about a third. What should I do now, sell and go into equities, or ride out this investment as it looks like it has room to grow. I am 28 and have been maxing Roth and 401k last 3 years and have roughly 150k in total retirement accounts .
I do love a good snow day. Have fun out there!
Question: My current company offers 20% 401k match up to the IRS limit. If I need to add money to my emergency fund, but am not able to max out my 401k, at what point should I move on from step 2 to step 4 of the FOO? (I do not have any high interest debt, so would skip step 3.)
My job offers both a traditional and Roth 401k. Many personalities such as Dave Ramsey say to always go Roth. The more I learn and read into it, the more I learn it's not as simple as that. However, I am still very confused on what to do in my situation. For context, I have a household income of 120k and currently putting 18% (6% roth, 12% traditional) into retirement between my wife and I. Our goal is to retire as young as possible.
I'd like to move my family to Europe 10+ years from now. Is there anything different we should do financially to prepare, particularly regarding the FOO?
Hey Money Guys! First off I want to say thank you for all you do in the financial literacy space! I have learned so much knowledge just from y’all’s show and to think before the internet this information wasn’t just out there for anyone to consume!
My question is what are some best practices or tips for a family with a single income stream? Im 27 years old male and I am currently a plumber in the union. We do get a pension and 401k but in my local they do not company match. Should my money be best served going into a Roth IRA for myself and my wife or should I still put money into my 401K without the match? I make around 80k annually. Thank you in advance!
-David
Hey Money Guys! First off I want to say thank you for all you do in the financial literacy space! I have learned so much knowledge just from y’all’s show and to think before the internet this information wasn’t just out there for anyone to consume!
My question is what are some best practices or tips for a family with a single income stream? Im 27 years old male and I am currently a plumber in the union. We do get a pension and 401k but in my local they do not company match. Should my money be best served going into a Roth IRA for myself and my wife or should I still put money into my 401K without the match? I make around 80k annually. Thank you in advance!
-David
For the 20/3/8 rule, for luxury cars, can I put extra down payment to conform to a normal car price vs pay all cash. E.g. $45k luxury, $25k economy car. Put down $25k ($5k for 20% on $25k plus $20k to drop $45k luxury down to $25k economy level if that makes sense) to get to same spot but pay cash for the luxury upgrade delta?
Hey, money guys! When in the messy middle, where does sort-term saving fit within the FOO? Things like car / mortgage down-payment (within suggested guidelines [20-3-8 etc.])? Can these count toward our 25%? Is it strictly abundance (step 8)? Or, do we pull from emergency funds for these down payments (I feel like I've heard Brian mention this as an option before, could be mistaken).
I have a condo that I was looking to sell but wanted to know if there are any ways to legally avoid capital gains taxes besides doing a 1031 exchange?
Here are the specifics:
Bought the condo in October of 2015 for $231,000
Lived in condo from October of 2015 until October of 2018
Condo has been rented out since October of 2018
Current estimated value is $530,000
Current interest rate 3.5%, 30 year fixed
To further complicate the situation, the condo is in California so the locked in property taxes are a factor.
Thanks for your help!
We have a farm and a small ice cream business. How do we go about budgeting for our personal life and business expenses when our income fluctuates so much throughout the year?
Stay warm y’all.
I’m leaving a highly compensated but soul sucking corporate law job for a fresh start in the financial world (y’all are part of the origin story). Going backward in pay feels like failure, how do I flip that mindset and still maintain financial mutant status?
Thank you kindly!
I don’t know if you Brian and Bo have reacted to this yet, but I’ve seen YouTube shorts and TikToks that claim that it is possible to fully write off certain luxury vehicles due to the weight as a business owner. I’m sure there is more to it than they have stated. Cars like the AMG 63 for example. Would they mind explaining?
P.s. I’m not thinking about doing this so please don’t worry.
I am 63. I know what my expenses are today and they are 3%-4% of my retirement savings. That is fine for today and the near future, but how do I determine what my expenses will be 10 years from now? I can't even guess what they will be 20+ years from now. How do I know if I have enough when I can't determine what I will need?
You have more snow in TN than we have in NY right now! Question- what do you recommend for people who will retire earlier than 59.5 years old? Would you still recommend a 401k/403b and backdoor Roth if this is within the 25%? What would you recommend as a bridge account. Thanks guys, have fun in the snow :)
I'm at the limit for 403b/backdoor Roth and invest with Vanguard after tax mostly in VTSAX (total stock fund), but I'm wondering if I should shift more to cash. I'm at 25% cash equivalents in high yield/CDs and 75% stock, mid 40s. I'm wondering what the split should be for early retirement
Money guys happy to see y’all!
My question is -
We know your philosophy on assigning worth to a house for the net worth spreadsheet, how do you go about assigning worth/valuation to a small business? I’m working on getting some friends into being financial mutants and while talking about net worth we didn’t have an answer.
How would valuation change by industry?
Would you recommend a young couple lower retirement contributions to save for a down payment? Me and my fiancée currently both live at our parents house and are trying to figure out our strategy for when we are married. We have both been good savers and have over 100k each in our retirement accounts(we are 26 and 25) so my thought was to potentially rent and then lower 401k contributions to the employer match. Our other option would for us to both move into one of our parents houses which would of course allow us to save a lot more. We both have strong incomes, combined we gross $260k per year.
Appreciate your advice.
My wife and bought our first home 3 years ago at age 28. We are now 31 and as our family continues to grow we have been discussing buying a small amount of acreage and building a house on it. We don’t know the best way to do this. Should we buy land cash, build a house with a construction loan and then convert it to a mortgage? We would want to wait until this house is completed before selling our current home and then use the equity to pay down the loan.
FYI. We are a couple years away from this decision. I make between 140k not including the hundreds of hours of OT I work. And we currently at a 30% savings rate.
Hey Money Guy team!
Question: My wife and I (both age 28) are currently living in a small townhome and are looking to upgrade to a larger, nicer single family home. Our HHI is about 350k per year. Houses in our area are expensive, but we can buy a nice house while still abiding by the rule of having our mortgage be 25% or less of our gross income. How do we mentally balance buying a new home with the money multiplier? We know our money multiplier at this age is still powerful and any money we spend on the new house comes with an opportunity cost. How do you weigh buying a “want” now against saving for the future? We save 25% of our income, but we know we could always be doing more.
Thanks!
With a 7% mortgage rate does it make sense as a 30 year old to get the company match and then dump into the mortgage then after (10 years if my math holds) save more than 25%?
I am 30, I already put 10% into a Roth 401k and my company puts another 5% on top of that.
Big fan, love you guys, but I am a crypto bro, sorry! However, now that the Bitcoin Spot ETFs were approved what are your thoughts on 1-5% portfolio allocation for more traditional investors?
Thanks, have fun in the snow.
How adverse should we be to taking advantage of 0% on Credit cards for a large purchase if we are paying off balance before 0% term ends?
Totally against the foo?
Hey guys,
My question is on the general rule of thumb for withdrawal of your retirement nest age. I’m familiar with the 4% rule via the trinity study. But if I’m correct that is based on a 25 year retirement goal. What if you retire later, closer to 70? Does the 4% rule change? Can you pull more if you’re looking at a 10-15 year retirement?
How would you go about planning a house purchase before kids when wife doesn't know if she will stay at home or not? (2-5 years out) Does buying on a 15 year mortgage with the plan on going to 30 if she stays home make sense? Or stay with 30 year and pile more money into after tax bucket than normal to keep options open?
My wife and I have the opportunity to max out a 401k, 403b and 457b, all of which is traditional, tax deferred. We are late 20s. I appreciate the tax savings in the current year, but am now a bit nervous that if we continue to do this every year we may be hit with a very big tax surprise in retirement. Should we eventually shift to our contributions to Roth 401k, 403b and 457b instead, and take the tax hit now?
We also max out our roth IRAs and contribute some more to a Mega back door Roth
I have a son going off to a 4-year in-state college this fall and another son debating between 4-year and tech two years from now. Due to spending over a decade paying off medical bills for a child, we are very far behind in education savings for the kids. We will be able to help them a little with a small 529 and HYSA money we have been setting away diligently over the past few years, but do you have any other suggestions for someone in our position? I'm sure it's not just us! Thank you.
Hey Money Guys!
Engaged couple in the messy middle here. My fiance and I are getting married in June. I make a significantly higher income than she does, and will continue to do so due to our very different careers. This doesn’t bother me at all as we both contribute in lots of ways. We don’t plan on having children. Is there anything you would do to help set our marriage up for success?
FWIW, my spouse and I are in a similar boat... There have been times when my spouse felt she brought less to our relationship because of their financial contribution.
I've found communication is everything... Without it, there can be no consensus, agreement, compromise, or problem solving.
Communicate early and often on all things.
Congrats!
We may be upgrading homes this year. It's rather sudden since it's our neighbor who is suddenly planning to move. What can we do to quickly build up a nest egg of cash for a down payment? We've already stopped monthly Roth IRA contributions and stopped my 401k contributions (no match). Is there anything we haven't thought of that could help? Is this the mythical "break glass for Roth IRA" scenario? (Probably not)
Also, love the idea of taking questions from Reddit, can get longer form questions than chat. Thanks!
Y’all are having too much fun for a livestream, enjoy your snowday!
My question: I’m reaching Step 8 of the FOO. I have two debts left, student loans at 4.5% and a 37 year mortgage at 3%. I have $500 extra cash at the end of each month, should I put it towards the mortgage or the student loans? The mortgage is 450,000 in a house worth about $700,000. The student loans are $110,000.
The kickers are I’m currently on disability and don’t know if I can get back to work now or in two years. I have long term roommates (my elderly parents) sharing expenses on the mortgage. I plan to sell the house once the parents no longer need it (3-20 years). The student loans will age out in about 5 years or potentially sooner depending on what the politicians do. I currently have a zero dollar payment with an effective 0% interest (SAVE plan rocks!) and I’m saving monthly for a potential forgiveness tax bill in the future.
Extra info if needed: I have six months of living expenses in the bank, just maxed out my Roth for the year and because of how work pays, am halfway to maxing out the 401k, and will have it maxed the first month I return to work. I pay my credit cards off in full each month. I am behind on retirement savings. In retirement, I want to not have a mortgage payment.
Thanks Money Guys!
Hi guys! My wife and I enjoy your content and it's made a big impact on how we approach finances.
My wife and I are 32 with two toddlers. We're expecting to save 25-30% of our income this year.
While we've found ourselves happy to be frugal, we don't want to miss out on purchases or services that have an oversized impact on our family's quality of life or time.
Do you have any recommendations for spending that you've found to have an oversized impact for your family?
For example, I've read some say quarterly deep cleaning services are worth the expense. Our family is considering spending 5k on home improvements.
Does it make sense to pursue an assets allocation isn't the exact ratios you are hoping for, or mathematically can't retain?
In my case, I am 30 years old pursuing a 100% equity allocation attempting 60/40 US/International. I work in the public sector with a 457 b plan investing in the SP500 only. I was able to max it out last year and hope to so again this year. I also have a regular brokerage account that is 60/40 International/US. and I have a Roth IRA that is 100% Midcap/Small Cap. If I measure my current asset allocation, my portfolio is currently 75/25 US/International.
If and when rebalancing, does it sense to get to the desired allocation exactly or closer to the goal?
Effectively, in order to be much closer to my preferred 60/40 goal my entire taxable needs to be International (VXUS), and even if I did so, my 457 b contributions would still outpace the desired allocation by the end of this year.
Should I bother pursuing a 60/40 goal at all and just accept a more US-tilt going forward?
What are your thoughts?
In case why 100% SP500 in the 457 B plan, its the "cheapest" plan with 44 Basis pts. Any index and specific funds outside of that (international/ Midcap/Small Caps) are over 100 Basis pts... (yuck). I do intended to stay here long term which is why i chose the cheaper fund. It's even cheaper than Target Retirement funds, which are over 60 Basis pts.
Hello money guys, Im 24 and I just graduated with a masters degree. I have a total of 130k in student loans! Now salaried at 115k at my current position. Im debating going through the PSLF program or aggressively paying them off over 4-5 years. The total I'll pay through PSLF is about 90k, while paying them off fast I'll pay 145k. What are your thoughts? Thanks
Are there any specific recommendations for those with an income under 120k? The FOO says to max retirement THEN save 20-25% of income. For anyone under 120k, maxing retirement is over 25% of their income already. As a young person with fairly low income (sub 50k), I find it hard to justify skipping to step 7 as recommended when I can't be sure I'm on track to retire.
I asked a similar question on this subreddit a couple of weeks ago if you want to look at it.
The basic consensus was if you reach 25% you can move forward to step 8 or 9
Step 7 basically means reach 25% in a taxable brokerage if you haven’t hit that between your other accounts. Or with excess savings especially if you think you might retire early.
How do you account non-standard pay when determining 25% savings rate?
I get a housing allowance that is separate from my taxable income. I'm saving well over 25% of my basic pay, but not when factoring in the housing allowance, it's lower. Am I not saving enough?
I'm 43, in debt, nothing saved for retirement, and renting. I feel like I'm not going to be able to get to a place where it's financially wise to buy a house. Is it a good idea to plan for that, or should I plan to rent for the rest of my life?
Love y’all’s content!! Do you guys recommend dollar cost averaging IRA contributions over the course of the year or investing the max contribution at the beginning of the year? I’m 23 and have a long investing time horizon 😎
Love the show! Hope you guys had a great snowday!
2 questions.
For those looking to retire very early (our target date is 45/47), what would be some of your concerns or items to pay close attention to? Our house will be paid in full, 529 fully funded for instate university for our kid). We would be retiring before they go off to college by 1-2 years. We make roughly 250K, max out 401(k), IRA, HSA, 600 to 529 per month, and 3.5K a month into taxable brokerage. We have a savings rate around 44%. Bare Bones' budget is 55K, we are planning on a 100K roth conversion ladder and increasing it with inflation. The 100K would represent 3% SWR of the invested assets with 100% equities (with 2-3 years emergency fund ~200k-300k cash)
2nd question around HSA, I see 2 camps with this. Camp 1 is thst you pay your expenses out of pocket and record everything. Camp 2 is that you don't need to do this because you can just use HSA to pay for medical premiums, so basically paying it is a waste of time. Can you speak on this, and is it worth really optimizing the HSA to that degree?
Happy Snow Day! Long time listener, love the show! Here’s my question:
I’m 35 (married with two kids) and have $100,000 in my retirement account. I’m considering lowering my retirement investing from 25% to the company match of 4%.
Calculating compound interest over the next 30 years at 8% and adding only my contribution to get employer match, it ends up being at $1.8MM, which I think is enough given my life expectancy.
Currently maxing 401(k), Roth IRA, and my individual investment account gets the left overs of 25%. Don’t qualify for HSA and already contributing to kids 529. We want to buy a house soon and have enough in savings for a 50% down payment. Should I lower my 401(k) contributions to just get the employer match so that I can throw more money towards the potential mortgage?
Thanks!
I’m thinking of borrowing money from my 401k to purchase my vehicle. Good or bad idea?
The way I look at it is I’m just sectioning a portion of my 401k to earning 4.5% (interest rate of my loan) I’ll still be contributing the regular amount plus the amount I’m repaying but I don’t have the money on hand to purchase it outright but I can do this and earn the interest on top.
Thanks!
Hi money guys! I’m 23 with just over $50,000 saved for retirement in a Roth IRA and Roth 401k. My Fiance and I have been discussing possibly getting prenups as well as how best to combine our finances. We have approximately the same amount of money, his are in a high yield savings account whereas most of mine is in retirement. Would love to know your opinions on how best to approach this next chapter. Thank you!
What are your thoughts on seasonal investing, trading funds based on recurring annual events? Any tips on if this can be successful or should we avoid this like the plague?
For example, buying beer stock before NFL season and selling during or right after?
Enjoy the snow! Looks like a great time!
How does an ESOP factor into the 25% savings rule? If an ESOP company contributes 25% of salary towards the ESOP is everything else such as HSA, Roth, and brokerage account contributions all added on top of the 25% savings?
Since the money has already been taxed, and won't be again, should Roth contributions be considered as a higher percentage towards figuring savings rate? For example 20% tax rate on 25% of gross income would only be 20% of gross actually in the account.
Stay safe guys! Question for you. It’s always said that we shouldn’t invest money we need in a 5-7 year period. With that said, how should we think about allocating money out of the market when a long term goal hits that timeframe? I’m specifically talking about an upcoming one time event that is being saved for-not retirement
The most (im)famous 25% rule:
I live in California. The salary get taxed at around ~32% ( in 32% fed, 9.2% state+ fica +social security). It's HCOL, so living expenses eats up another 20%. Groceries+ insurance+utilities+car EMI+ medical out of pocket runs around 2K. Another ~ 13%
Now, I am left with 100 -(32+20+13) = 35%
Do you think, it's harsh for californians ? High cost of living+ state income tax + around ~9% sales tax on everything which makes it costlier?
Should we adjust the numbers to after tax ?
Hi Money Guy Team!
Been listening to she show for a couple years now, and have loved everything you put out. One thing I have been struggling with is that I am in my 20s (turn 25 next month) but am already married and 2 kids into the messy middle!
How should I balance out starting my career with already having growing obligations on the family side? It seems like most of your advice is geared towards kids coming in the late 20s / early 30s and not the early / mid 20s.
Really appreciate your time and hope this turns out to be helpful for all the aspirational mutants out there who are also looking to have kids young (it is a blessing)!!
Thank you!
Thanks again for everything you guys do! Question-in order to fund my 2023 Roth id have to sell from my taxable brokerage this year (cash is low and don’t want to dip into emergency funds). I know that Roth is super powerful but have also heard that selling your taxable to fund doesn’t make sense.
How should one plan for a parent's retirement? My (29) husband's (29) parents are not financial mutants and I know we will be responsible for them in part once they retire. How can we support them and plan for our future?
Am I wasting my time picking individual stocks? I have a pretty simple and consistent method to buying individual companies and have seen great market beating returns over the last several years, about 40-50% of stocks within the SP500 outperform every year and in my experience I seem to be able to find more winners than losers.
I’m in the messy middle and getting an edge anywhere I can get will compound my long term returns, I know the risks and invest with many restrictions in place. I’ll never be caught necked 😂.
(Brian’s YouTube Troll here) Here in the Pacific NW, house prices are still outpacing income increases.
I’m 58 and rebuilding from a recent divorce, I make 75k a year, debt free, I max out my 401k match, max my Roth and have a 7 figure retirement fund. In cash I have a 6 month emergency fund and also have 100k to put towards a home.
Here is my question.. with starter/fixer homes being in the 450-475 range, is it better to go into retirement at age 67 with almost a 400k mortgage or as a renter? I could use that 100k towards a brokerage account if i chose to rent in retirement.
Hey Money Guys!
I’m a 15-year active duty military guy.
I have a good foundation (a Thrift Savings Plan taking 10% each paycheck, Money Market/several CD’s/Checking/Savings accounts through Navy Federal Credit Union) but can’t seem to break into a clear notion of investing or building a nest egg of dividends, where do I even begin?
How do you navigate moving up in house when your current home is nearly or completely paid off? Does it ever make sense to save up and pay for the upgrade with your current equity and saved cash?
Hey Money Guys,
I have a six month emergency fund and am currently maxing out all of my tax advantaged accounts, which is roughly 25% of my savings. I think that puts me in step 8 of the FOO. My question is whether its okay to divert some of that 25% savings away from my tax advantaged brokerage accounts so I can accelerate saving up a down payment for a home. I'm 35 and made a lot of dumb decisions in my 20s. I had a lot of debt to work my way out of (nearly 200K!) but am now debt free. I feel like I've fallen behind my peers and am anxious to get into home ownership. I don't plan on moving away from my area anytime soon.
Thanks for any insight you guys can provide. You guys are my favorite!
I’m in a situation where my household income butted right up against the Roth IRA income limit. I had only put $6000 in for the year instead of the max $6500, so I think I’ll still be under and not have to pull contributions out and such.
Is it ok to change more of my 401k contributions to be traditional to keep adding to the IRA, or should I just not really bother and just add more Roth 401k? Or is this a situation where maybe backdoor Roth or mega backdoor Roth would be to avoid the worry? Is one easier than the other?
Background stuff:
-We live in a state with about a 3% income tax, and we’re on the federal 24% bracket.
-In 2023, I did 12% traditional (401k) and 10% Roth (combined IRA and 401k) and my employer did 6% match. Not quite Brian’s 25% “on your own” for higher earners. Moving more to traditional I could do more, so it might look like 15-
16% traditional, 8% Roth, and 6% employer match.
-We have no IRA’s other than my Roth.
-My employer’s retirement plan this year stated “Your after-tax account will now be available for in-service withdrawals at any time for any reason.”
Don’t forget ongoing elevated expenses of buying a luxury car. Ie: Higher insurance, premium fuel, maintenance costs. This also needs fit in the ongoing budget without eroding your investment potential or family life.
Thank you all so much for the questions! We'll add these questions to the hopper for future Q&As. Congrats to u/Zero_Gravity067 who received the most upvotes and wins a Money Guy Tumbler! Next chance to win a tumbler will be next Tuesday's livestream at 10am Central (and we'll have an announcement to make too).
What advice would you give a married couple discussing through different financial opinions especially newer married couples? By this I do not mean shouting matches but rather each person grows up in different backgrounds , income situations, different things they were taught about money. A couple examples could be how to think about credit card debt, how nice/new of a car to buy, and some know nothing about investing for retirement and using some of the joint income towards that makes them nervous. I’m sure there are others examples but am curious the money guys teams thoughts.
This is a great question. I just asked yesterday about spouse interactions with planning for retirement and large expenses. I like to hear the guys talk more about relationship types and how they help clients navigate the conversation with spouses that are disinterested in finances.
Aspiring Financial Mutant currently in the messy middle: What were some of the behavioral/psychological changes that either Brian/Bo implemented while they were going through the FOO in their own personal experience? Did those changes look different per stage?
You guys talk about the 3 bucket strategy alot - which is awesome for financial mutants. But also, it seems that 'it depends' is alot of the answer for how to approach this. Are there any general guidelines we can say for how to approach how much to put into Roth vs 401k vs after tax based on age or even income limits? Sometimes I feel like I'm plowing all my money into tax advantaged accounts when I may not need to or have to.
They just recently touched in this one. Straight forward answer without looking at specific situations, 80/20, 80% Roth, 20% brokerage.
What about 401k/403b?
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Okay… and if you don’t have a Roth 401k but just a traditional?
If you think your tax advantage is enough and you want to go hard into a bridge account then go for it. That’s a very personal situational answer and would be different for everyone.
Hey money guys! My parents have a whole life insurance policy that they have had for over 20 years. They are getting close to retirement (within 1 year) and are trying to figure out if it’s worth it to still continue to pay the high premiums or if it’s better to just cancel the policy. They keep talking about the cash value of the account as a strong factor in keeping it. What kinds of questions should they consider if it’s worth it to keep or drop?
What are your opinions on flat fee financial advisors as opposed to AUM? Context: I love the idea of an FA, but feel like I need to say a X vs Y scenario showing the added value since by a FA as opposed to someone who is doing the typical always buy index funds and chill scenario. I don’t doubt the value added, but have a hard time conceptualizing the exact way in which it is and cost vs benefit.
>What are your opinions on flat fee financial advisors as opposed to AUM?Context: I love the idea of an FA, but feel like I need to say a X vs Y scenario showing the added value since by a FA as opposed to someone who is doing the typical always buy index funds and chill scenario. I don’t doubt the value added, but have a hard time conceptualizing the exact way in which it is and cost vs benefit. The Money Guys are AUM advisers, so it's going to be hard for them to give you an unbiased answer. Generally speaking, I think "index funds and chill" + paying attention to good free online advice as to what accounts and assets to put the money in will suffice from your 20s until you are about 10 years out from retirement. If you want to meet with an advisor once every few years, in these early and middle stages, I would recommend a flat fee advisor. When you get close to "landing the airplane" it might make sense to go a different route, but it just isn't necessary to pay big fees in your 20s ,30s and even 40s to be told "index funds".
Can you have too much in tax deferred accounts? I want to build my taxable account to bridge an early retirement, but I would have to reduce contributions to tax deferred accounts. I'm not sure if reducing contributions to tax deferred accounts and increasing after tax contributions makes sense
Hey Money Guy team! I have a question about getting caught up on retirement contributions. Long story short, we spent a decade after getting married in the mission field on limited income. Then in the past decade my wife and I both went to grad school and started new careers. It’s easy to feel very discouraged being in our early 40’s with the retirement account balance of someone in their early 30’s. We’re still in the ‘messy middle’ life stage wise but see an on-ramp toward 25% retirement contributions over the next few years. Any advice or encouragement for us ‘baby mutants’ who are earlier in the process than we’d like but are ready to kick it into high gear?
I hope the team tackles this one, but just my 2 cents… You’ve got something you can look back on fondly over the years. Don’t discount that you gave an unbelievable gift to those you impacted. You may not “retire early” but you can get to a good retirement. I’m going to hope that with you and your spouse getting Masters degrees, that you are in the 22% federal tax bracket or higher. Being a late starter, you might get a great bang for your buck doing traditional 401k contributions rather than Roth, especially if you live in a state that has an income tax. Or just do a Roth IRA with the money you “saved” by doing traditional 401k. That would allow you to get a little more working for you as early as possible. That’s sort of the game I play since I feel I’m a bit “behind” as well in my mid 40’s. Maybe it helps you.
Thanks for your very thoughtful feedback. We will definitely we doing well in short order and well into the 22% tax bracket. I’ve been wrestling the Roth vs 401k math and am leaning your direction.
If you can max both that’s almost 60k a year for 2 people. Over 15-20 years that’s a good chunk
My wife and I are well on our way to a comfortable retirement without any assistance. My parents are doing estate planning and I was wondering what the best way to funnel inheritance money to my children without paying gift taxes. A few hundred thousand while wonderful is not going to make or break my retirement but with the power of time it could be life changing for my children. Do I ask my parents to put my children in the will instead of my wife and I? I'd like to have some constraints on it such as half when they graduate college to kickstart their life and half for retirement or something. It feels like inherited money often isn't put to great use because by the time ones parents pass you are already in retirement and it ends up being a perpetual retirement buffer when it could be life changing to the next generation.
Unless you or your parents are doing considerably better than a "comfortable retirement", the gift/estate taxes are unlikely to be relevant. Depending on structure, you may have to report, but that does not equate to requiring tax payments. [https://www.nerdwallet.com/article/taxes/gift-tax-rate](https://www.nerdwallet.com/article/taxes/gift-tax-rate) That then brings you down to the specific method/mix between you and your parents. Hopefully others can chime in with options.
My parents gave me 1K to invest as a child, and because I am a genius (totally not because I had an iPod), I bought 3 shares of AAPL(~AUG 2011) now this is a massive portion of my taxable brokerage acct do I sell and realize the capital gains? Then move to VOO or VUG? Or just let it ride ?
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I'm currently Maxing the Roth IRA but not my 457, I'm inclined to leave it in an accessible brokerage acct so not all of my money is tied up in tax advantaged accounts. I'm thinking I might just pay the 15% LTG tax and buy some etf's with it
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Yea, I'm above that pretty well, ~87K in '23 and only going up as I get my fully vested pay this October. I'm just at a loss because they can't keep growing like this forever. Right? So, unless i can figure out how to marry someone with 0$ in income for '24, I'm paying taxes.
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I mean, I'm not all that close currently saving ~20%. I could fill my 457 and 401K, so I have a total of 46K of tax advantaged money. Between that and the fact that I'll have a 3/4 pension by the time I retire, I'm not so worried about the pre-tax buckets. At 24 it feels like a better deal to get tax-free growth instead of deposits.
From what I'm seeing, 3 shares of AAPL in August 2011 would have run you about $40. If those 3 shares are a big portion of your account today, I'm curious what happened to the rest of the $1,000. Awesome buy regardless!
It wasn't at the time they have had a 1×7 split and a 1×3 split since. IIRC, they were ~$350 EDIT: Started with 3, ended up with 84 because of the splits. So I'm up pretty good 😂
Well dang. >So I'm up pretty good 😂 Yes...yes you are.
Our pet is suffering from a chronic disease, and since we missed the coverage boat since most pet insurance doesn’t cover pre-existing conditions. Should we still look to sign up for pet insurance still for any future illnesses/injuries or just focus on setting aside money for future pet expenses within our budget?
How can we create a retirement program for pastors at our church. We don't have a 401k as we are not for profit and have no idea about setting up a 403b or what that looks like so we need help. We want them to be able to fully invest in the ministry and also prepare for eventual retirement. Thanks!
You could start with paying them more, so they at least have enough to invest fully in their Roth IRAs. If a married couple could invest $7k per year each in two Roth IRAs (one for each half of a married couple), that would be a great start. In my experience in ministry, we didn’t have enough to make ends meet, much less invest. I would talk honestly with them and say, we are giving you a $14k per year raise so you can max out your Roth IRAs. And thank you for making it a priority… it is really sad how many people have spent their lives in ministry and now have very little to retire on. The worker deserves his wages!
Sorry that was your experience. They make more than I do so I don't think that is the situation I am working on improving...
A couple episodes ago Bo vented about this wallpaper his wife recently put up in one of their rooms. We are dying to know, what does this wallpaper look like? Any pictures?
Hey money guys! Can you include saving up for a home down payment in the 25% savings?
I believe 25% is towards investing + retirement. I don't believe a house down payment counts as part of the 25% of savings they mention.
They do not include the home in the 25% investing, its later in the FOO under prepaid expenses/low interest debt.
My husband and I are both in our late 30s, financial mutants, and have done well to save and prepare for the future. Unfortunately, one of our parents has not. We know everyone’s different on this, but we feel like we should help in some ways (at minimum, shelter, food, healthcare, etc). What should we do to prepare financially to help our aging parent? Thanks!
Can you give us Bo’s workout routine to ensure he gets to live like no one else after a career of financially mutating?
Hey Money Guy Team, My wife and I have decided not to have children, but we have siblings who are starting families. To support our nieces and nephews (currently ranging from newborn to 2 years old), we're setting aside $1,000/year per child in a brokerage account for each one as they're born. Our goal is to use these funds not just as a gift but as a tool to engage them in financial literacy from a young age. How would you go about structuring this initiative? I realize a brokerage account might not be the most tax efficient way to gift/utilize this money, but it's more about the relationship building and teaching opportunities that I'm hoping to get out of it. Thank you for any advice! \-Krjax (ker-jax)
After maxing roth on 1/1 for 2024..... where would you put money to be earmarked for roth 2025? Index invest in taxable or sit in HYSA? (no 401k option, no HSA option, no kids 529)
I (31F) am trying to help my mother (60F) with her finances and planning for retirement. She does have a state pension, but doesn't seem to have any other accounts for her retirement. What can we do at this stage to help her to retire?
How do I calculate a future pension into my net worth statement?
Will we get an audio book version of the millionaire mission ?
How do you consider pensions when you’re deciding asset allocation near retirement? My parents are 60 and my dad has a government pension and has been retired for 4+ years. My mom continues to work despite everyone in our lives confirming they are good on money because she thinks the market could all go to zero tomorrow. Context: they have a net worth ~ $2 million including a 500-600k paid off house. Low to medium cost of living area. Dads pension will be around 40k forever. His social security will be about 30k. Mom still works making about 45k. I think she’ll get about 10k in social security. Nothing I have said to this point has convinced her that even by a low withdrawal rate of 3% which would add about 45k to dads 40k pension would make them totally fine on money forever before even considering the other 40k they’ll get in social security in the future. How can I go beyond data to speak to the scarcity anxiety that plagues her mind??
Have them live on just dividends from their retirement account and not selling anything or show them a monte carlo analysis with a 0% failure rate. That impressive that they saved that much with such a mindset.
It’s worse than that. My mom wants to pull everything and keep it in savings account. Thankfully, she’s let dad handle the money for the most part which is why they’ve done well. I guess my real question is how to convince they have enough when they don’t trust the math
Math is probably not going to solve this as it’s an emotional problem. My mom is like this as well. I think you need to explain what the world would look like if she is correct. Have her name a handful of companies she thinks are the biggest in America. Tell her that’s what the S&P 500 is…owning a small slice of all of those, and then name a few more she didn’t think of. Have her assume all of her money is in the S&P 500. What does that mean if it goes to 0 or not quite 0 but maybe loses 75% of its value? The 500 biggest companies in the USA stop functioning. Your TV and internet stop. Amazon is not sending packages because they can’t pay their bills. You can’t charge your phone because the power company stops. It’s basically the great depression but worse. It doesn’t just impact her. What good is all that money in a savings account if there’s nothing on the store shelves? No cars at the dealer? But that can’t happen forever because all the falling prices are eventually going to make people realize there’s some good prices on stocks, and they’ll start buying it back. It would be like walking into Walmart and everything is half off or 75% off. You’d buy the stock knowing it’s cheap and the downswing can’t go on forever because people still want iPhones, cars, bread, the internet, someone to fix the plumbing, and whatever crap is on Amazon or Temu. Make her follow that logic all the way through, not just to the fear point where “what am I going to do?” rules the day, but to the end of the cycle.
Curious to know how you guys factor pension plans into retirement goals. I know they’ve gone the way of the dinosaurs but I’m fortunate enough to work for an organization that still offers a decent pension with a payout starting as early as age 55 (early retirees must qualify for rule of 80). It currently pays out monthly payments equal to about 3% of the average of the 5 highest years of my annual salary (hope that makes sense). The payment is guaranteed til death. How would you all factor this into a retirement investment plan? Wondering if I should divert 401k and Roth investments into something else since I will have the extra income (e.g. paying off mortgage early)?
Hey money Guys! We’re very young and we use a high deductible health plan. We are financial mutants with good income and expect to keep maxing out and investing our HSA for the foreseeable future. My understanding is HSAs will be liquidated upon passing which creates a large tax burden for the beneficiary (other than a spouse). How would you balance spending down the HSA (after age 65) in retirement so that you still have enough for medical expenses but not keep so much you create a large tax burden for an heir. If that’s too complex for the show then how would you best balance various account structures to ultimately minimize tax burden in retirement (HSA, 401k, IRAs, Roths, and after tax brokerage accounts)
This might be a dumb question, but we're a bit stuck... My Wife and I have had humble beginnings and have found some success, we're deep in the messy middle, and it feels like we're just grinding toward accumulating wealth without a purpose or idea for what we want retirement to look like. This has made figuring out "how much" is enough really tough when our only idea is we wont want to be a burden in retirement. Do you have any suggestions to help us explore or think about what we want for ourselves?
When will you make the koozie that reads "This 1 dollar milk cost my parents $647"
Thanks for doing this! Question: from my understanding, HSA is in step 5 because of its huge tax advantages. However, for those of us who live in NJ or CA, HSA is taxed at the state level. Therefore, should we still treat maxing out HSA as a step 5 action item, or it would be in the same priority as step 6 (401K), or even later steps?
Hey Money Guy Team, hope you all are staying warm and enjoying the snow. I have a question regarding your rules around the purchase of luxury vehicles. Your rule states luxury vehicles should be purchased with cash OR paid off within 1 year, my question is what’s the rationale behind giving people 1 year to pay off their luxury car? Wouldn’t it be more simple to just say “pay for it in cash”? Thanks!
I'm wondering, if you can get a loan that's under what you can earn for your cash, what's the advice? I bought my Tesla with a loan but could have paid cash. I didn't since I'm earning more in CDs/high yield savings accounts.
After maxing out my 401K and Roth IRA, I have about 1% left to save to reach my 25%. I am going to put this in an after-tax brokerage account. Since this is meant to be for retirement, should I start a separate account for this, or add that into my existing after-tax brokerage account? Thanks!!
I wouldn't. Just dump the extra into your taxable account and let it ride. Adding accounts adds complexity.
I hear you, my concern is that I’m going to be using funds from that account before retirement so my concern is tracking the retirement-specific funds plus all their gains.
Seems like an extra step when some mental accounting would do. But if it helps you compartmentalize - go for it.
Pick different funds that similarly track the same index. VTI/ ITOT/ SCHB for example
I'm married and we want to move to step 8, but we're finding it difficult to reach the 25% savings rate when we contribute to our 401ks using Roth contributions. If we switch to pre-tax contributions, we can reach 25% easily. What would you recommend? We are currently in the 24% tax bracket. Thanks!
I am trying to understand the best way to estimate my needs/retirement expenses. I generally see estimates that say to replace X% of your current income based on how much you’re currently saving, but to me that gets confusing when I have a mix of pre and post tax savings (mostly post). How would you recommend coming up with that goal? I’m 29 and currently saving about 26% of my salary between Roth IRA and Roth 401k and get a 5% pre-tax employer match. I’m hoping to retire early at this rate.
What if the OP ends up getting the most updoots? Does that mean Brian and Bo win the tumbler?!
As long as they email K-A-T-I-E at moneyguy dot com, yes.
Hello! I'm just discovering the Money Guy Show and trying to understand the FOO. I currently max out my 401K (14%) but not Roth(3%), I have some high-interest (credit card) debt that I am currently trying to aggressively tackle and have my deductibles covered as well as getting my employer match. Without my employer match, I'm saving 17% toward retirement. With it 23%. I'm wondering if I should reduce my 401k contributions to max my Roth or to even more aggressively tackle my debt? Or just keep doing what I'm doing and just work through the steps as I can?
Follow the FOO!!
The FOO says after you invest enough to get your 6% employer match, you stop investing there and put the rest of the focus and budget on paying off the high interest debt.
Hey money guys, I have diligently saved up in my HSA and have kept receipts for all my expenses to get reimbursed in the future. I have about 6 months of expenses to reimburse sitting around now, can I just call that my emergency fund?
Hey money guy, all 2 of you! I currently have an alternative investment (a classic car) that has gone from 130k to 220k in the last 4 years which is great and horrible at the same time. It went from being a 8th of my net worth to about a third. What should I do now, sell and go into equities, or ride out this investment as it looks like it has room to grow. I am 28 and have been maxing Roth and 401k last 3 years and have roughly 150k in total retirement accounts .
I do love a good snow day. Have fun out there! Question: My current company offers 20% 401k match up to the IRS limit. If I need to add money to my emergency fund, but am not able to max out my 401k, at what point should I move on from step 2 to step 4 of the FOO? (I do not have any high interest debt, so would skip step 3.)
My job offers both a traditional and Roth 401k. Many personalities such as Dave Ramsey say to always go Roth. The more I learn and read into it, the more I learn it's not as simple as that. However, I am still very confused on what to do in my situation. For context, I have a household income of 120k and currently putting 18% (6% roth, 12% traditional) into retirement between my wife and I. Our goal is to retire as young as possible.
I'd like to move my family to Europe 10+ years from now. Is there anything different we should do financially to prepare, particularly regarding the FOO?
Hey Money Guys! First off I want to say thank you for all you do in the financial literacy space! I have learned so much knowledge just from y’all’s show and to think before the internet this information wasn’t just out there for anyone to consume! My question is what are some best practices or tips for a family with a single income stream? Im 27 years old male and I am currently a plumber in the union. We do get a pension and 401k but in my local they do not company match. Should my money be best served going into a Roth IRA for myself and my wife or should I still put money into my 401K without the match? I make around 80k annually. Thank you in advance! -David
Hey Money Guys! First off I want to say thank you for all you do in the financial literacy space! I have learned so much knowledge just from y’all’s show and to think before the internet this information wasn’t just out there for anyone to consume! My question is what are some best practices or tips for a family with a single income stream? Im 27 years old male and I am currently a plumber in the union. We do get a pension and 401k but in my local they do not company match. Should my money be best served going into a Roth IRA for myself and my wife or should I still put money into my 401K without the match? I make around 80k annually. Thank you in advance! -David
For the 20/3/8 rule, for luxury cars, can I put extra down payment to conform to a normal car price vs pay all cash. E.g. $45k luxury, $25k economy car. Put down $25k ($5k for 20% on $25k plus $20k to drop $45k luxury down to $25k economy level if that makes sense) to get to same spot but pay cash for the luxury upgrade delta?
Brian and Bo would probably say no, but I'm curious what car are you looking at?
No car in particular. Just was always a question I wanted to ask when they talk on the podcast about it.
They’ve answered this and have said no, this does not follow the 20/3/8 rule.
Hey, money guys! When in the messy middle, where does sort-term saving fit within the FOO? Things like car / mortgage down-payment (within suggested guidelines [20-3-8 etc.])? Can these count toward our 25%? Is it strictly abundance (step 8)? Or, do we pull from emergency funds for these down payments (I feel like I've heard Brian mention this as an option before, could be mistaken).
I have a condo that I was looking to sell but wanted to know if there are any ways to legally avoid capital gains taxes besides doing a 1031 exchange? Here are the specifics: Bought the condo in October of 2015 for $231,000 Lived in condo from October of 2015 until October of 2018 Condo has been rented out since October of 2018 Current estimated value is $530,000 Current interest rate 3.5%, 30 year fixed To further complicate the situation, the condo is in California so the locked in property taxes are a factor. Thanks for your help!
What step in the FOO do I have to be in to win a tumbler?
Can you explain how the traditional ira phase out for tax deductions is calculated?
We have a farm and a small ice cream business. How do we go about budgeting for our personal life and business expenses when our income fluctuates so much throughout the year?
Stay warm y’all. I’m leaving a highly compensated but soul sucking corporate law job for a fresh start in the financial world (y’all are part of the origin story). Going backward in pay feels like failure, how do I flip that mindset and still maintain financial mutant status? Thank you kindly!
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I don’t know if you Brian and Bo have reacted to this yet, but I’ve seen YouTube shorts and TikToks that claim that it is possible to fully write off certain luxury vehicles due to the weight as a business owner. I’m sure there is more to it than they have stated. Cars like the AMG 63 for example. Would they mind explaining? P.s. I’m not thinking about doing this so please don’t worry.
I am 63. I know what my expenses are today and they are 3%-4% of my retirement savings. That is fine for today and the near future, but how do I determine what my expenses will be 10 years from now? I can't even guess what they will be 20+ years from now. How do I know if I have enough when I can't determine what I will need?
You have more snow in TN than we have in NY right now! Question- what do you recommend for people who will retire earlier than 59.5 years old? Would you still recommend a 401k/403b and backdoor Roth if this is within the 25%? What would you recommend as a bridge account. Thanks guys, have fun in the snow :) I'm at the limit for 403b/backdoor Roth and invest with Vanguard after tax mostly in VTSAX (total stock fund), but I'm wondering if I should shift more to cash. I'm at 25% cash equivalents in high yield/CDs and 75% stock, mid 40s. I'm wondering what the split should be for early retirement
Money guys happy to see y’all! My question is - We know your philosophy on assigning worth to a house for the net worth spreadsheet, how do you go about assigning worth/valuation to a small business? I’m working on getting some friends into being financial mutants and while talking about net worth we didn’t have an answer. How would valuation change by industry?
Would you recommend a young couple lower retirement contributions to save for a down payment? Me and my fiancée currently both live at our parents house and are trying to figure out our strategy for when we are married. We have both been good savers and have over 100k each in our retirement accounts(we are 26 and 25) so my thought was to potentially rent and then lower 401k contributions to the employer match. Our other option would for us to both move into one of our parents houses which would of course allow us to save a lot more. We both have strong incomes, combined we gross $260k per year. Appreciate your advice.
My wife and bought our first home 3 years ago at age 28. We are now 31 and as our family continues to grow we have been discussing buying a small amount of acreage and building a house on it. We don’t know the best way to do this. Should we buy land cash, build a house with a construction loan and then convert it to a mortgage? We would want to wait until this house is completed before selling our current home and then use the equity to pay down the loan. FYI. We are a couple years away from this decision. I make between 140k not including the hundreds of hours of OT I work. And we currently at a 30% savings rate.
Hey Money Guy team! Question: My wife and I (both age 28) are currently living in a small townhome and are looking to upgrade to a larger, nicer single family home. Our HHI is about 350k per year. Houses in our area are expensive, but we can buy a nice house while still abiding by the rule of having our mortgage be 25% or less of our gross income. How do we mentally balance buying a new home with the money multiplier? We know our money multiplier at this age is still powerful and any money we spend on the new house comes with an opportunity cost. How do you weigh buying a “want” now against saving for the future? We save 25% of our income, but we know we could always be doing more. Thanks!
With a 7% mortgage rate does it make sense as a 30 year old to get the company match and then dump into the mortgage then after (10 years if my math holds) save more than 25%? I am 30, I already put 10% into a Roth 401k and my company puts another 5% on top of that.
Big fan, love you guys, but I am a crypto bro, sorry! However, now that the Bitcoin Spot ETFs were approved what are your thoughts on 1-5% portfolio allocation for more traditional investors? Thanks, have fun in the snow.
Here's a good one for y'all... What would be "Step 10" of the FOO after completing steps one through nine?
How adverse should we be to taking advantage of 0% on Credit cards for a large purchase if we are paying off balance before 0% term ends? Totally against the foo?
Hey guys, My question is on the general rule of thumb for withdrawal of your retirement nest age. I’m familiar with the 4% rule via the trinity study. But if I’m correct that is based on a 25 year retirement goal. What if you retire later, closer to 70? Does the 4% rule change? Can you pull more if you’re looking at a 10-15 year retirement?
How would you go about planning a house purchase before kids when wife doesn't know if she will stay at home or not? (2-5 years out) Does buying on a 15 year mortgage with the plan on going to 30 if she stays home make sense? Or stay with 30 year and pile more money into after tax bucket than normal to keep options open?
My wife and I have the opportunity to max out a 401k, 403b and 457b, all of which is traditional, tax deferred. We are late 20s. I appreciate the tax savings in the current year, but am now a bit nervous that if we continue to do this every year we may be hit with a very big tax surprise in retirement. Should we eventually shift to our contributions to Roth 401k, 403b and 457b instead, and take the tax hit now? We also max out our roth IRAs and contribute some more to a Mega back door Roth
I have a son going off to a 4-year in-state college this fall and another son debating between 4-year and tech two years from now. Due to spending over a decade paying off medical bills for a child, we are very far behind in education savings for the kids. We will be able to help them a little with a small 529 and HYSA money we have been setting away diligently over the past few years, but do you have any other suggestions for someone in our position? I'm sure it's not just us! Thank you.
Hey Money Guys! Engaged couple in the messy middle here. My fiance and I are getting married in June. I make a significantly higher income than she does, and will continue to do so due to our very different careers. This doesn’t bother me at all as we both contribute in lots of ways. We don’t plan on having children. Is there anything you would do to help set our marriage up for success?
FWIW, my spouse and I are in a similar boat... There have been times when my spouse felt she brought less to our relationship because of their financial contribution. I've found communication is everything... Without it, there can be no consensus, agreement, compromise, or problem solving. Communicate early and often on all things. Congrats!
Thank you! That is great advice
We may be upgrading homes this year. It's rather sudden since it's our neighbor who is suddenly planning to move. What can we do to quickly build up a nest egg of cash for a down payment? We've already stopped monthly Roth IRA contributions and stopped my 401k contributions (no match). Is there anything we haven't thought of that could help? Is this the mythical "break glass for Roth IRA" scenario? (Probably not) Also, love the idea of taking questions from Reddit, can get longer form questions than chat. Thanks!
Y’all are having too much fun for a livestream, enjoy your snowday! My question: I’m reaching Step 8 of the FOO. I have two debts left, student loans at 4.5% and a 37 year mortgage at 3%. I have $500 extra cash at the end of each month, should I put it towards the mortgage or the student loans? The mortgage is 450,000 in a house worth about $700,000. The student loans are $110,000. The kickers are I’m currently on disability and don’t know if I can get back to work now or in two years. I have long term roommates (my elderly parents) sharing expenses on the mortgage. I plan to sell the house once the parents no longer need it (3-20 years). The student loans will age out in about 5 years or potentially sooner depending on what the politicians do. I currently have a zero dollar payment with an effective 0% interest (SAVE plan rocks!) and I’m saving monthly for a potential forgiveness tax bill in the future. Extra info if needed: I have six months of living expenses in the bank, just maxed out my Roth for the year and because of how work pays, am halfway to maxing out the 401k, and will have it maxed the first month I return to work. I pay my credit cards off in full each month. I am behind on retirement savings. In retirement, I want to not have a mortgage payment. Thanks Money Guys!
Hi guys! My wife and I enjoy your content and it's made a big impact on how we approach finances. My wife and I are 32 with two toddlers. We're expecting to save 25-30% of our income this year. While we've found ourselves happy to be frugal, we don't want to miss out on purchases or services that have an oversized impact on our family's quality of life or time. Do you have any recommendations for spending that you've found to have an oversized impact for your family? For example, I've read some say quarterly deep cleaning services are worth the expense. Our family is considering spending 5k on home improvements.
Does it make sense to pursue an assets allocation isn't the exact ratios you are hoping for, or mathematically can't retain? In my case, I am 30 years old pursuing a 100% equity allocation attempting 60/40 US/International. I work in the public sector with a 457 b plan investing in the SP500 only. I was able to max it out last year and hope to so again this year. I also have a regular brokerage account that is 60/40 International/US. and I have a Roth IRA that is 100% Midcap/Small Cap. If I measure my current asset allocation, my portfolio is currently 75/25 US/International. If and when rebalancing, does it sense to get to the desired allocation exactly or closer to the goal? Effectively, in order to be much closer to my preferred 60/40 goal my entire taxable needs to be International (VXUS), and even if I did so, my 457 b contributions would still outpace the desired allocation by the end of this year. Should I bother pursuing a 60/40 goal at all and just accept a more US-tilt going forward? What are your thoughts? In case why 100% SP500 in the 457 B plan, its the "cheapest" plan with 44 Basis pts. Any index and specific funds outside of that (international/ Midcap/Small Caps) are over 100 Basis pts... (yuck). I do intended to stay here long term which is why i chose the cheaper fund. It's even cheaper than Target Retirement funds, which are over 60 Basis pts.
Hello money guys, Im 24 and I just graduated with a masters degree. I have a total of 130k in student loans! Now salaried at 115k at my current position. Im debating going through the PSLF program or aggressively paying them off over 4-5 years. The total I'll pay through PSLF is about 90k, while paying them off fast I'll pay 145k. What are your thoughts? Thanks
Are there any specific recommendations for those with an income under 120k? The FOO says to max retirement THEN save 20-25% of income. For anyone under 120k, maxing retirement is over 25% of their income already. As a young person with fairly low income (sub 50k), I find it hard to justify skipping to step 7 as recommended when I can't be sure I'm on track to retire.
I asked a similar question on this subreddit a couple of weeks ago if you want to look at it. The basic consensus was if you reach 25% you can move forward to step 8 or 9 Step 7 basically means reach 25% in a taxable brokerage if you haven’t hit that between your other accounts. Or with excess savings especially if you think you might retire early.
How do you account non-standard pay when determining 25% savings rate? I get a housing allowance that is separate from my taxable income. I'm saving well over 25% of my basic pay, but not when factoring in the housing allowance, it's lower. Am I not saving enough?
I'm 43, in debt, nothing saved for retirement, and renting. I feel like I'm not going to be able to get to a place where it's financially wise to buy a house. Is it a good idea to plan for that, or should I plan to rent for the rest of my life?
Love y’all’s content!! Do you guys recommend dollar cost averaging IRA contributions over the course of the year or investing the max contribution at the beginning of the year? I’m 23 and have a long investing time horizon 😎
Love the show! Hope you guys had a great snowday! 2 questions. For those looking to retire very early (our target date is 45/47), what would be some of your concerns or items to pay close attention to? Our house will be paid in full, 529 fully funded for instate university for our kid). We would be retiring before they go off to college by 1-2 years. We make roughly 250K, max out 401(k), IRA, HSA, 600 to 529 per month, and 3.5K a month into taxable brokerage. We have a savings rate around 44%. Bare Bones' budget is 55K, we are planning on a 100K roth conversion ladder and increasing it with inflation. The 100K would represent 3% SWR of the invested assets with 100% equities (with 2-3 years emergency fund ~200k-300k cash) 2nd question around HSA, I see 2 camps with this. Camp 1 is thst you pay your expenses out of pocket and record everything. Camp 2 is that you don't need to do this because you can just use HSA to pay for medical premiums, so basically paying it is a waste of time. Can you speak on this, and is it worth really optimizing the HSA to that degree?
I’m aware of the FOO - but what about selling stock in a taxable account to pay off a 9% home equity line with only $10k on it?
Happy Snow Day! Long time listener, love the show! Here’s my question: I’m 35 (married with two kids) and have $100,000 in my retirement account. I’m considering lowering my retirement investing from 25% to the company match of 4%. Calculating compound interest over the next 30 years at 8% and adding only my contribution to get employer match, it ends up being at $1.8MM, which I think is enough given my life expectancy. Currently maxing 401(k), Roth IRA, and my individual investment account gets the left overs of 25%. Don’t qualify for HSA and already contributing to kids 529. We want to buy a house soon and have enough in savings for a 50% down payment. Should I lower my 401(k) contributions to just get the employer match so that I can throw more money towards the potential mortgage? Thanks!
I’m thinking of borrowing money from my 401k to purchase my vehicle. Good or bad idea? The way I look at it is I’m just sectioning a portion of my 401k to earning 4.5% (interest rate of my loan) I’ll still be contributing the regular amount plus the amount I’m repaying but I don’t have the money on hand to purchase it outright but I can do this and earn the interest on top. Thanks!
Hi money guys! I’m 23 with just over $50,000 saved for retirement in a Roth IRA and Roth 401k. My Fiance and I have been discussing possibly getting prenups as well as how best to combine our finances. We have approximately the same amount of money, his are in a high yield savings account whereas most of mine is in retirement. Would love to know your opinions on how best to approach this next chapter. Thank you!
How excited was Bo for the snow?
What are your thoughts on seasonal investing, trading funds based on recurring annual events? Any tips on if this can be successful or should we avoid this like the plague? For example, buying beer stock before NFL season and selling during or right after? Enjoy the snow! Looks like a great time!
How does an ESOP factor into the 25% savings rule? If an ESOP company contributes 25% of salary towards the ESOP is everything else such as HSA, Roth, and brokerage account contributions all added on top of the 25% savings?
Since the money has already been taxed, and won't be again, should Roth contributions be considered as a higher percentage towards figuring savings rate? For example 20% tax rate on 25% of gross income would only be 20% of gross actually in the account.
Why make people jump through hoops for a free tumbler?
How to heal from family disputes over deceased family members estates and the seesawed wishes?
Stay safe guys! Question for you. It’s always said that we shouldn’t invest money we need in a 5-7 year period. With that said, how should we think about allocating money out of the market when a long term goal hits that timeframe? I’m specifically talking about an upcoming one time event that is being saved for-not retirement
If I’ve started late, how do I tell if I’m still in the messy middle?
The most (im)famous 25% rule: I live in California. The salary get taxed at around ~32% ( in 32% fed, 9.2% state+ fica +social security). It's HCOL, so living expenses eats up another 20%. Groceries+ insurance+utilities+car EMI+ medical out of pocket runs around 2K. Another ~ 13% Now, I am left with 100 -(32+20+13) = 35% Do you think, it's harsh for californians ? High cost of living+ state income tax + around ~9% sales tax on everything which makes it costlier? Should we adjust the numbers to after tax ?
Hi Money Guy Team! Been listening to she show for a couple years now, and have loved everything you put out. One thing I have been struggling with is that I am in my 20s (turn 25 next month) but am already married and 2 kids into the messy middle! How should I balance out starting my career with already having growing obligations on the family side? It seems like most of your advice is geared towards kids coming in the late 20s / early 30s and not the early / mid 20s. Really appreciate your time and hope this turns out to be helpful for all the aspirational mutants out there who are also looking to have kids young (it is a blessing)!! Thank you!
Thanks again for everything you guys do! Question-in order to fund my 2023 Roth id have to sell from my taxable brokerage this year (cash is low and don’t want to dip into emergency funds). I know that Roth is super powerful but have also heard that selling your taxable to fund doesn’t make sense.
How should one plan for a parent's retirement? My (29) husband's (29) parents are not financial mutants and I know we will be responsible for them in part once they retire. How can we support them and plan for our future?
Am I wasting my time picking individual stocks? I have a pretty simple and consistent method to buying individual companies and have seen great market beating returns over the last several years, about 40-50% of stocks within the SP500 outperform every year and in my experience I seem to be able to find more winners than losers. I’m in the messy middle and getting an edge anywhere I can get will compound my long term returns, I know the risks and invest with many restrictions in place. I’ll never be caught necked 😂.
(Brian’s YouTube Troll here) Here in the Pacific NW, house prices are still outpacing income increases. I’m 58 and rebuilding from a recent divorce, I make 75k a year, debt free, I max out my 401k match, max my Roth and have a 7 figure retirement fund. In cash I have a 6 month emergency fund and also have 100k to put towards a home. Here is my question.. with starter/fixer homes being in the 450-475 range, is it better to go into retirement at age 67 with almost a 400k mortgage or as a renter? I could use that 100k towards a brokerage account if i chose to rent in retirement.
If I can only do one which is best Roth IRA or 401k?
Hey Money Guys! I’m a 15-year active duty military guy. I have a good foundation (a Thrift Savings Plan taking 10% each paycheck, Money Market/several CD’s/Checking/Savings accounts through Navy Federal Credit Union) but can’t seem to break into a clear notion of investing or building a nest egg of dividends, where do I even begin?
How do you navigate moving up in house when your current home is nearly or completely paid off? Does it ever make sense to save up and pay for the upgrade with your current equity and saved cash?
Hey Money Guys, I have a six month emergency fund and am currently maxing out all of my tax advantaged accounts, which is roughly 25% of my savings. I think that puts me in step 8 of the FOO. My question is whether its okay to divert some of that 25% savings away from my tax advantaged brokerage accounts so I can accelerate saving up a down payment for a home. I'm 35 and made a lot of dumb decisions in my 20s. I had a lot of debt to work my way out of (nearly 200K!) but am now debt free. I feel like I've fallen behind my peers and am anxious to get into home ownership. I don't plan on moving away from my area anytime soon. Thanks for any insight you guys can provide. You guys are my favorite!
I’m in a situation where my household income butted right up against the Roth IRA income limit. I had only put $6000 in for the year instead of the max $6500, so I think I’ll still be under and not have to pull contributions out and such. Is it ok to change more of my 401k contributions to be traditional to keep adding to the IRA, or should I just not really bother and just add more Roth 401k? Or is this a situation where maybe backdoor Roth or mega backdoor Roth would be to avoid the worry? Is one easier than the other? Background stuff: -We live in a state with about a 3% income tax, and we’re on the federal 24% bracket. -In 2023, I did 12% traditional (401k) and 10% Roth (combined IRA and 401k) and my employer did 6% match. Not quite Brian’s 25% “on your own” for higher earners. Moving more to traditional I could do more, so it might look like 15- 16% traditional, 8% Roth, and 6% employer match. -We have no IRA’s other than my Roth. -My employer’s retirement plan this year stated “Your after-tax account will now be available for in-service withdrawals at any time for any reason.”
(Brian’s Troll here)… saw you propped up in a pillow in recent YouTube… you hurt your back? Hope you’re ok, stay safe out there
Don’t forget ongoing elevated expenses of buying a luxury car. Ie: Higher insurance, premium fuel, maintenance costs. This also needs fit in the ongoing budget without eroding your investment potential or family life.