Financial Independence What European countries have you considered as possible FIRE locations? |
- What European countries have you considered as possible FIRE locations?
- FedFIRE, or, How a US Foreign Service Officer Can Retire at 50
- Daily FI discussion thread - September 08, 2018
- Thought this applied here also...
- What is / was the best thing you learned / did on your FI journey?
- Unemployed full-time student unsure if he's going to make it long enough for financial aid seeking advice
- Anyone use MaxFiPlanner?
- Accounting Programs
- Looking to make a plan to begin my journey
- I will soon be graduating from college and I just so happened to stumble upon this subreddit - I would appreciate some advice!
- Barista FIRE jobs
- College?
- Should I pursue income generating assets or assets that increase in capital gains?
- What if scenario here, owner of a multi-million dollar company.
- Heavy Student Loan Debt, Help with FIRE strategy?
| What European countries have you considered as possible FIRE locations? Posted: 08 Sep 2018 06:47 AM PDT In general, European states have heavy taxes on capital gains and dividends. Some levy a wealth tax. However, you often get good healthcare in return, and a guarantee of no surprise "out-of-network" costs. Curious if any US FIRE-ers here have run the numbers and found some good candidates? My research has revealed Czechia as a possibility (15% flat investment income tax; still looking for the gotchas there). [link] [comments]  | ||
| FedFIRE, or, How a US Foreign Service Officer Can Retire at 50 Posted: 08 Sep 2018 01:25 PM PDT Hey, yinz...long-time lurker, first-time poster, but I thought you might like to hear about my sort-of alternative path to FIRE. FedFIRE! Prepare yourself for one heckuva ramble. A little background… For those who are interested, I've posted two extensive "Ask Me Anythings" 7 and 4 years ago look at the posts I've submitted, I'm not active in this username otherwise). I am an edge-case, in that both my wife and I work as Foreign Service Officers (FSOs), which referred to as being a tandem couple. As such, we have not spent all of our careers overseas. In the end, I do believe we will come out ahead, as we've made the "sacrifice" to work in the DC region when both of us can't get jobs in the same embassy. This has basically meant we passed up one 3-year tour (so far) in order to keep us both working at full-salary. We have friends and colleagues who are also tandem couple who have chosen not to do this. They invariably choose to go to low-cost of living (LCOL) posts, so one salary can take them much further. The Perks of Being a So, FedFIRE? Well, if you're a federal employee, there are a couple of ways to retire early, and plenty of routes to financial independence, but I happen to be in the unusual (in a good way) position of being able to retire as early as 50 under the Foreign Service (Dept. of State, if unclear). This special retirement provision applies to State, federal law enforcement, and I think a few other random federal jobs (maybe nuclear inspectors...I've never been able to get a clear answer). If you have 20+ years of service and you're 50, you can retire with a "pension" of 1.7% times your years of service. The actual value of your pension is based off the average of your three highest annual salaries. For each year worked after 20 years, you only get an additional 1% (not 1.7%). You can also draw down your TSP / 401k with no penalty. This is basically known as FERS Special (or Special FERS, if you nasty). To keep the numbers simple, if someone with an average high-3 salary of $100,000 retired exactly at 50 with exactly 20 years of service, they'd get (1.7 x 20) 34% of $100,000 — $34,000 a year, paid out monthly. To further clarify, if you worked 21 years, you get 35%, not 35.7%. The government does provide COLA (cost of living adjustments)...most of the time, and there is a formula they use to keep it in line with (but technically less than) inflation. Additionally, because you can retire early, you also get supplemental payments to make up for Social Security eligibility until age 62 (this supplement gets diminished / goes away if you earn wages in excess of about $15,000, so careful with that side-hustle, I guess). The supplement is calculated by taking your years of service divided by 40 times your estimated minimum social security payment. At 50 years, this would be in the $1000-$1300 range for most people. So, without saving a dime, the hypothetical $100,000 foreign service officer can pull down $46,000 a year. To be clear, we are fully eligible for social security from the minimum age onward, so that income would technically increase even if taken immediately at 62. Now we have the other leg, TSP...the government's 401k. Most government agencies match up to 5%, and with 20 years of service, it's entirely reasonable (at full IRS limits) to put away $400,000, assuming minimal to no growth. A 4% SWR gives you about $1300 a month, or $15,500 a year. So, boom, over $61,000 of income a year. Then there's healthcare...which you get to keep after retirement, and the government still pays their share. I considered this to be the key element of my retirement, as it diminishes an otherwise significant expense. Finally, you also can maintain your life / disability insurance at a discount (though most reduce the coverage). Oh, and by the way, my wife gets the same benefits (humble brag). So, boom x 2, over $122,000 per year, assuming we both only make $100k as our high-3 salaries (we actually have made more due to occasional warzone compensation and such), and our TSP accounts have been doing much better. Pretty darned sweet. Fallout 3: The Realities of Living in the DC Wasteland It is not all wine and roses (well, there always wine...and liquor, and beer), but not all roses, at least. When I started in the federal government, and not as an FSO, my salary was about $28,000...GS-07 in the early 2000s, for those wondering. I worked my way up in my career and made some not-great financial decisions like taking on too much student debt, and buying a condo/townhome at the absolute height of the market pre-housing crisis — an ARM too. Additionally, and this pains me to this day...I was advised by my HR in my first government job to cash out my TSP because I was going back to grad school and I only had a couple thousand in the account. Boo! Even so, my career hasn't been $100k+ a year since day one, but a steady slog of promotions, cost-of-living adjustments, and time-in-grade increases. I haven't been able to contribute the IRS max to my TSP for my entire career, though I have taken advantage of max employer matching since entering federal service. Both my wife and I had student loans, and they are now paid off in our early 40s. We still own our underwater condo/townhome, though we are renting it out. Within six months of buying the property, we were almost $100k underwater. This has never recovered, and the neighborhood has gone downhill due to multiple foreclosures and short-sales over the past decade. We have taken a loss on this property, rent-wise, every time we rented it out while overseas (though only a couple hundred a month, so 90%+ of the mortgage was covered. This isn't so dire, because while overseas, your housing in the host country is paid for, so it was kind of like maintaining a $200 mortgage for X number of years. We intend to sell the townhome next summer once our tenants' lease is up, likely at a break-even point. From a real estate perspective, this property has kicked our butts, as the ARM was okay for a few years, but now with rising rates, the rental loss is going up every year, especially as HOA fees have risen with no improvement in services. Contrary to what many claim, it is entirely possible to not "win" in real estate in Northern Virginia (and no, I'm not discounting the reality of the ARM or the housing crisis). I would not have predicted the neighborhood we were in to turn to low-income in less than five years, but it did. To be clear, the neighborhood is still perfectly safe, as ethnically diverse as it ever was, but the schools went downhill due to the tax base, and the property values never recovered post-crash. We have a secondary e-fund set up to cover paying the mortgage for up to a year, in the event it doesn't sell in the first few months. By that point, we might consider refinancing (assuming we have enough equity to satisfy investment property re-fi requirements), and renting it out again (though I really loathe being a landlord). Living in the DC region as a whole is expensive and difficult...groceries, commutes, high cost of living for everything else. This isn't uncommon for any metro area, but it's a constant reminder of what we're missing overseas. We made a decision to move farther out into Loudoun County and bought a second giant house (cliche), but now we have a kid, and we expect to be a multi-generational family, with (hopefully) grandparents moving in very soon. We want this for the kid, and difference in mortgage between our crappy townhome and the new place is only $900, but a difference of 1200 to 4200 sq ft (I imagine some people choking at this on this sub!). We also moved strategically within a few miles of the future Ashburn and Dulles metro stations, but for now the commutes are an hour-plus via bus. That said, our property values have increased by 10%+ over the past year, and the metro won't even be here for two years or so, so we're doing waaay better than our last attempt at real estate (and to be honest, if it never went up, I'd still be totally cool with that). We would like to go overseas at least one more time, though the realities of grandparents in their late 60s / early 70s and a kindergarten-aged child mean we need to be very strategic about that. We took the kid with us to our last post in Brussels, but they don't remember any of it, as they were 1.5 to 4.5 during that time frame (the kid spoke French first, but doesn't remember a word now that we've been back for a year). Regardless, we have planned for the "worst" case (really not that bad, just not ideal) of continuing to live and work in the DC-region until retirement eligibility as early as 7 years from now. What RE means to ME Okay, so here's some real numbers… We are 42 and 43. Kid is 5. Our expenses are $90k a year. (Shock! Horror!) This includes a rental property (and associated expenses) losing us money and childcare (technically also losing us money...darned unemployed 5 year old!), which is about 18% of that total. Both of these expenses will go away before retirement. Our only liabilities are a $500k mortgage (new house) and the remaining $250k mortgage on old townhome. That seems like a lot of money, but not really for NoVA. We got rid of student loans, cars are paid off, and have no credit card debt. We have about $600k in our TSP. Assuming literally no growth, just base contributions, we will have $900k by the earlier eligible retirement date. We have about $100k in stock investments. We contribute about $10k a year to that, so, again, assuming no growth, about $170k by minimum retirement. I view this as the kid's college fund, assuming they want to go to college, or college exists in its current form. Running out the retirement benefits, our pensions alone will cover 90% of our current expenses. The social security "supplement" will cover the rest with room to spare. This ignores drawing down on the TSP funds. Our annual pre-tax income would be about $140,000. After taxes (effectively in the high teens, likely), probably about $118,000. That leaves us with about $2300 of "whatever" money per month. This is all based on current salary, no expectation of real retirement fund growth, and the assumption of our current expenses of $90k. Man Plans and Spouse Laughs "You want to retire at fifty? You're crazy. The kid will be 13! What will you do? We can't afford that!" Technically, in the government, there's no real "FU" money point. I mean, even if I had a significant windfall (let's say $1 million, though I have no wealthy relatives), I would not give up my pension or health care. I will work until at least 50...I kind of want to, so I have that going for me. That said, I'm technically eligible to retire before then, I just wouldn't be able to collect a pension or anything until 50. I am in the slow and steady process of convincing my wife that the numbers associated with our finances are, you know, real. She handles the budget (daily expenses), but I handle the big picture / retirement. Other than an actual 4% SWR, my numbers are crazy conservative. I assume no gains in any of our current accounts. I'm not Warren Buffett (or Jimmy, for that matter), but even if all our money was just in the G Fund under the TSP, we'd be guaranteed bond-level rates of returns. In reality, the bulk of our money is in the C, S, and I Funds (Large Cap, Small Cap, and International stocks). My plans include leaving NoVA, possibly to the Carolinas, Georgia, or Florida near (but not on) the beach to a single-level, single-family home. I've been watching a lot of Island Life on HGTV, and it is probably detrimental… ;) The going rate for these places right now is anywhere from $200-400k, which seems crazy cheap to me coming from DC area (we'd be able to buy in cash if we wanted). We plan to spend about 90 days (max no-visa required in most countries) a year overseas in short-term rentals, maybe not every year, but close to it in the first decade or so. We've traveled a ton, so our vision is basically enjoying the day-to-day life overseas without having the hassle of real ex-pat issues (having worked American Citizen Services, I have no desire for the type of troubles real ex-pats run into). Random Considerations, Questions, and Miscellania
What Motivates You to Be a Lazy Bum? Why retire so early, when the life of a diplomat is so totes awesome? It is and it isn't. My wife and I both had an involuntary "come to Jesus" (the hard way) moment during the metro bombing in Brussels. I had just exited the metro in Arts-Loi and was entering the US Embassy when the bomb went off. My wife was exiting at Schumann. These stops are at either side of the Maelbeek explosion. If I hadn't skipped a coffee that morning and my wife hadn't had an appointment at the EU, well…my username is unintentionally ironic. The thing is, I've been shot at in a warzone, been in a pretty bad car accident, was accidentally driven into a minefield (got out safely, though), all with work, but you don't expect this stuff in the "easy" posts. The things that seemed "part of the job" a few years ago don't necessarily seem worth it these days. A good friend of mine lost his arm a month ago to infection while serving in Africa. It was from a scratch, not a severe injury. Another colleague of mine was stabbed repeatedly in Latin America for trying to escape an extortionate cab driver. Dead now. A classmate of mine from my early FSO training was assaulted when she decided to come home early from work and walked in on her house being burglarized. She was beat up, but otherwise okay. This isn't always an easy job, let alone a fun job. We've all served places where our lives are literally on the line...and while I can't avoid "life", generally speaking, I do feel safer in the US than in Nicaragua, Russia, or, Nigeria. Less than a decade...that's the way I see. I'm doing my job (and then some), but the light at the end of the tunnel...that's in sight. Thanks for reading. Feel free to ask almost anything. I'm happy to add more depth to whatever I touched on, though I will be a little coy about exactly where I served in some instances (dates, in particular), as you can very quickly dox me like this. tl;dr: FSO and FSO wife can technically retire at 50. [link] [comments]  | ||
| Daily FI discussion thread - September 08, 2018 Posted: 08 Sep 2018 04:08 AM PDT Please use this thread to have discussions which you don't feel warrant a new post to the sub. While the Rules for posting questions on the basics of personal finance/investing topics are relaxed a little bit here, the rules against memes/spam/self-promotion/excessive rudeness/politics still apply! Have a look at the FAQ for this subreddit before posting to see if your question is frequently asked. Since this post does tend to get busy, consider sorting the comments by "new" (instead of "best" or "top") to see the newest posts. [link] [comments]  | ||
| Thought this applied here also... Posted: 08 Sep 2018 02:28 PM PDT
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| What is / was the best thing you learned / did on your FI journey? Posted: 08 Sep 2018 03:05 PM PDT The title, basically. What is the thing that helped you or you expect to help you the most? Could be advice, action, idea... [link] [comments]  | ||
| Posted: 08 Sep 2018 04:08 PM PDT Hello, I'm hoping someone would be kind enough to offer me some advice. I'm a 26-year-old full-time student who's going to a state university for computer science and applied mathematics. Back when I was 20-22 I was doing alright. Making $12.50 an hour, had $2,000 in savings, and a good credit score (although not a lot of credit history). In 2015 I made a series of very poor decisions. It's a long story, but, the short version is that I moved to another state to do door-to-door sales and was terrible at it. Ended up bouncing from place to place living on floors and eating rice and potatoes. It was a dark and difficult time but while this was going on I found this subreddit and decided to put my life in a better direction. I eventually cut my losses (admittedly too late) and moved back in with my parents (late 2015) with 18k in debt, a mangled credit score, and drive to change my life by getting an education. Early 2016 I become a Lyft and Uber driver for 6 months while I figured things out. Summer 2016 I enrolled in the local community college and got a part-time job there too. I studied and worked hard and got my Associates in General Studies while also taking the computer science courses that would transfer to the state school. Spring of 2018 I started at the university and declared a double major in computer science and applied math. Yet, I found taking the math and engineering courses while commuting to the community college for work too difficult to manage and quit my job. I told myself that my generous scholarships and post-graduation earning potential is enough to justify going to school full-time while unemployed and just use Stafford loans/scholarships. The other big mistake I made was not paying my 2016 taxes on time. I mistakenly thought that due to me driving for Lyft and Uber that I would have to pay taxes since it wasn't taken out of my paycheck. But since 2016 I've been more or less paycheck-to-paycheck and did not have enough extra to pay the IRS. Hence, I didn't file my 2016 taxes till I had to which was before the start of this fall semester. Ends up I didn't make enough in 2016 ($10,519) to justify my fear. While I waited for my tax return I completed my FASFA under the "will file" selection. Yet, my school notified me that they're going to need to verify my taxes before they disperse any financial aid. Luckily I filed my taxes early August and expected to have it returned to me within 6 weeks based on the IRS's given timeline. I planned according to this schedule and made sure I had enough money to last me 6 weeks till I get financial aid. Fast forward 3 weeks from that date to yesterday I get a letter for the IRS saying "we received a federal tax return ... To protect you from identify theft, we need to verify your identity before we process the return. ... After you've successfully authenticated your identity it may take up to nine weeks to receive your refund." The only problem is that I planned for 6 weeks from three weeks ago, not 9 weeks from today! I'd have to make my current $1,000 last over 2 months or get another means of income before it runs out (approximately a month). My plan for earning extra income was through two things. First, by becoming a math tutor, but it takes time to get clients. Second, working as a research assistant for machine learning. I'll hopefully be taking my first machine learning course next semester, after which I was going to start talking to professors to hopefully get a gig. Both of those take time. I'm not sure what other options are available to me on such short notice. All this makes it particularly difficult as I'm taking a heavy course load this semester (model of computation, probability theory, software engineering II, computer systems) and finding it difficult to eat and sleep let alone find work. Coming from poverty my perspective is that getting good grades is a means to escape the cycle of difficulty my family has been in for generations. I've been working relentlessly and making sacrifices for 3 years, I graduated with a 4.0 at the community college and currently have a 4.0 at the university. but I'm so tired of one barrier after another. I'm afraid, I don't want to be homeless and starving again. I'm astounded I've made it this far, I get emotional while on campus just grateful to be able to study. I never graduated high school or have a GED (unintentionally "unschooled"), I had to teach myself basic algebra and English at age 22 (because I never learned it as a child), and I'm the first one in my family to go to college. I never made good money, 2015, $10,519; 2016, $9,188; 2017, $14,344. All I want is to finish school so I can change that and eventually reach financial independence. I'm not sure what to do. Any recommendations? Details:
If there is anything else you want to know, feel free to ask. [link] [comments]  | ||
| Posted: 08 Sep 2018 01:32 PM PDT Saw this in a CNBC article. I currently use another tool but this one looks interesting. [link] [comments]  | ||
| Posted: 08 Sep 2018 01:30 PM PDT Hi everyone, I have a question. I'm FI but not RE. My wealth is mainly in oil and gas royalties, which generate income on a monthly basis. I've realized my spending has become out of control lately, and part of the reason is that I'm not separating business income (which I should be saving and investing) from personal income. I'm also having trouble visualizing everything because right now my business accounts and personal accounts are mixed. I was wondering what resources people use here to keep their personal and business lives separate? Do you use Mint for personal and Quicken for business, for example? Thanks so much!! [link] [comments]  | ||
| Looking to make a plan to begin my journey Posted: 08 Sep 2018 09:51 AM PDT This is a really long post I went into the FAQ's and it said to copy paste this. So here it is, with as much information as I can give. Life Situation: Currently I am a single 24(f). I will be starting graduate school thing month as well as working full time. I live in Washington state. Going to school to be a teacher. FIRE Progress: I am absolutely nowhere. I have no idea where to begin but I know my current spending and way of life is not sustainable. I'd really like to get better with my money and eventually have financial Independence. Gross Salary/Wages: $37,826 Yearly Savings Amounts: So I have a pension which I am not quite sure what it means. I also contribute to my account each month, yearly it looks like I put in about $1,500 a year of money through my own contributions. I am enrolled in SERS Plan 3. I do not understand this plan I do not understand what I need to do with it. This is something I desperately need help with understanding. Other Ordinary Income: Summer employment generally gets me $4k. I also do odd jobs such as babysitting and such and I'd say that adds another $1,500 per year. Current expenses: Rent: $730 Car: $320 Car Insurance: $140 Pet Care: $100 Food: $150 Gym: $90.00 Netflix: $13 Transportation (maintenance, gas, bussing): $75 Medical expenses: $100 Miscellaneous extras take up the rest of my income. I don't save a dime which I would really like to change. Assets: Is my car an asset? I have a 2017 Honda Fit. Liabilities: Car Loan- Original amount: $20,269 Interest rate: 4.24% Term: 72 months Loan Payment: $320.15 Student Loans: Currently sitting at $13,115.71 with varying interest rates the highest of the rates is 4.45% lowest is 3.76%. I have just accepted $37,098 in student loans for graduate school. $20,500 is at 6.6% and $16,598 is at 7.6%. Credit card debt: currently sitting at about 5k due to a bad breakup and it being summer break so I spent a little extravagantly on things that I was eventually going to need. Specific Question(s): Alright so questions where do I begin? How can I go about setting myself up for my future after grad school? Being a teacher isn't the biggest money generator. Should I be trying to contribute to a Roth? Also, for anyone who might know anything about student loans. I am in a public servant position currently and after 10 years of qualifying payments you can have your loans forgiven. Should I start paying them off now to get a jumpstart on those 10 years? Or if I do that will my grad school loans not be counted in with the forgiveness. Finally, for people who enjoy spending money how did you create and stick to a budget? I am also open to any feedback, I know I have made some pretty poor financial decisions in the last little bit but I'm still young, my credit is good, and I am ready and willing to learn. [link] [comments]  | ||
| Posted: 08 Sep 2018 02:19 AM PDT So a little about me.. I will be graduating soon with a B.S. degree in CS. I have always obsessed over my future and I want to be prepared in regards to my financial planning once I get a salaried job. I randomly came across this subreddit and I have been reading the posts for hours. To be quite honest, I don't know too much about financial planning other than putting money into my savings account. Widening my horizons to understand the nature of Financial Independence and the concept of FI/RE has been nothing short of fascinating to me. I feel fortunate that I will be able to educate myself in the topic of FI/RE, as I have heard starting young gives you a huge advantage. I believe that Discovering this subreddit will be life-changing for me. It's so motivating to read people's stories on their financial success, and how they achieved there goals. In the real world, it seems as if talking about your financial gains is almost taboo, so it has really helped me scratch the surface in regards to understanding how you can acquire wealth/financial independence. Anyways, I had to ramble because this subject excites me. I did want to ask, does anyone have any suggestions for any books I should consider reading to better educate on this topic? Thanks! Tl;dr I will be graduating and (hopefully) acquire a job with a good salary and want to know if there are any books I should read as a beginning [link] [comments]  | ||
| Posted: 07 Sep 2018 10:27 PM PDT New poster, heard of FIRE a while back but got reminded of it by the article that's going around lately. I've known about FIRE, but only learned about "barista FIRE" from reading that article, and it's really appealing to me. I'm really interested for several reasons:
Has anyone gathered a list of good barista FIRE jobs? I've never worked in Starbucks and don't know quality of life there, and also don't know how many hours it takes to get health insurance at Starbucks. Also, I don't know if barista FIRE is a phrase that includes many other types of similar jobs, or if it's strictly just a Starbucks barista thing. [link] [comments]  | ||
| Posted: 07 Sep 2018 10:05 PM PDT Some background about me: I'm a current high school senior who discovered the financial independence movement through a teacher-recommended article. The idea resonates with my inclinations; I barely spend any money I earn, I've dabbled in cryptocurrencies to increase my net worth (low, but it's the idea that counts). I'm a good student: in the top 5% of my class and with a 35 on my ACT. I probably could get into an Ivy League school where about half my tuition would be covered by financial aid. I could probably also get into some well-known STEM schools. My question: If my goal was financial independence by age 35, which of the following options is my best choice? 1 - Ivy League School: They carry prestige and better odds of landing a high(er) paying job. They also come with connections. 2 - Other School: Obviously this entails a much more expansive list of schools, so it is harder to generalize. These would presumably be cheaper if I could obtain merit scholarships. 3 - Skip College: The most radical idea perhaps (my high school has a 99% college rate). Would save money off the bat but hinder salaries later. 4 - Something that I haven't thought of: Especially those who have found success, I'm interested in hearing your ideas or experiences? [link] [comments]  | ||
| Should I pursue income generating assets or assets that increase in capital gains? Posted: 07 Sep 2018 09:14 PM PDT | ||
| What if scenario here, owner of a multi-million dollar company. Posted: 07 Sep 2018 08:56 PM PDT What if scenario: what if you were a passive part owner of a company that does millions in revenue per year, and gives you anywhere from $50 to $100K per year in owner distributions? Would you sell? Hold? Reinvest? Retire? No right or wrong answers, mostly just interested to hear thought processes. [link] [comments]  | ||
| Heavy Student Loan Debt, Help with FIRE strategy? Posted: 07 Sep 2018 07:10 PM PDT This community has been so awesome and inspiring to watch. I mainly lurk, but am posting today via a throwaway. I'm hoping to get a 'second set of eyes' on my wife and I's situation to see if people have thoughts on how to optimize our situation. While I've been interested in FIRE for a while (but ruled it out because I thought we were in too deep with student loans), we are newly committed to it – so we're at the point of hammering down our expenses (stop eating out, leaning out our expenses however we can, etc). Bit of background: My wife and I graduated with $380k student loan debt 10 years ago (270k hers, a pharmacist, and 110k mine – a school counselor). Our initial income was around $170k, and we tried to attack our student loans pretty hard – but just the monthly payments were oppressive, and so we used a debt snowball method so that our monthly finances weren't so rigid. In 10 years, we've paid that down to $219k. We've consolidated many of our loans, and there are few 'easy wins' left (some consolidated loans are 70k+). We admittedly fell off the track of paying aggressively toward these loans due to some other factors (kids, life). Right out of the gate, we bought a 2 family house for $232k with an FHA loan (3% down) which allowed us to live in a 3 bedroom apartment for ~$650 a month – which saved us around 500/month in our area. Over time, we've had 3 kids and we moved out of our 2 family (but kept it as a rental) into a bigger house with an in-law apartment ($335k) which we again bought with a low downpayment mortgage. Our in-laws contribute $900/month in rent. Just by the numbers, here is where we are at: Income and investments Income from jobs: Me $65k + Her $135k = 200k Income from rental property (not including in-law): 2350/ month – expenses = 600 month, or 7200 a year. Investments: Her 401k: $67k Me 457: $45k 403b: $15k Pension: ~$45k contributed – I cannot access this unless I sever employment, and I could not access employer contributions which dwarf my contributions. I am vested at this point. College savings: $22k between a custodial account, and 3 529s. Debt Student Loans: $219k – various interest rates, mostly 5% or under. Real Estate: 2 Family we owe $190k on it (3.25% interest rate). We paid $230k, it is worth around $260k currently. Current house we owe $307k (4% Interest rate), paid $335k and it is worth around $360k. Automobile: $10k (we own one car outright, and owe on the other) Credit Card Debt: $12k (0% until May) There are some other costs, such as day care and after school programs, that take a small bite out of our budget We are at a crossroads with regard to strategy and are interested in others thoughts. We are 35 and are concerned about the amount we've saved for retirement – I'm not sure we'd be on pace for a standard retirement, nevermind FIRE. We'd like to try to fully retire by the time our youngest goes to college – so ~15 years. We'd like to start taking better advantage of our tax advantaged accounts – max her 401k + her employer match, max my 457 (and I get a 6.2% employer match into the 403b because my employer does not pay social security), and possibly max the 403b (though I'm stuck at Edward Jones with that and don't have access to good funds). If we hit a recession, we might shift back to going hard on the student loans if the ~5% guaranteed gain seemed better than what we could earn from pouring that money into our retirement accounts). I also plan to refinance 2 student loans that are at a 6.7% interest rate, I believe I can get that to 6% fixed through SoFi. Any advice is appreciated. Specifically interested in strategy to invest/max our retirement accounts vs. recommitting to aggressively paying down debt. Also curious about thoughts on variable vs. fixed rate student loans, and if we should prioritize one vs. the other. Should I refinance student loans – and if so, should I go with a variable rate that seems lower? Should I be worried about the fees in my 403b account – I think I'm in the lowest cost funds available to me, but they're still pretty high (.47 I believe) compared to a passively managed index. Thanks in advance for any thoughts! [link] [comments]  |
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