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New 29yr old Married Father with Finance Questions
Old 01-26-2013, 12:26 PM   #1
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New 29yr old Married Father with Finance Questions

First I'd like to say what a great forum! I've already seen several forum posts that directly impacted questions I had.

I just turned 29 and we had our daughter several months before. Wife and I have cars paid for and school loans paid of (one Bachelors degree and one masters). Wife is currently working as a teacher and I'm working an IT gig. Jointly we have over 100k in retirement savings and about 60k in a savings account earning almost no interest. We are contributing max to our ROTH IRA's and doing ~10% of total income into a 403(b) and TSA plan.

In the past I had been very aggressively saving, contributing and overall ontop of things. However I found myself getting very stressed over uncertainty in the future regarding SS benefits and what my pension payout would be. I realize now with the little one that it is very important that I'm more on top of things. I think the most frustrating thing is that other occupations offer pension payouts that allow for early retirement (I know this is changing for just about everyone my age).

So I've got a few questions:
1) How many people wished they would have gone a different career path due to ease of retirement? And what was it? Was there a salary difference that would have allowed you to better invest the money?

2) Investing for early retirement but also investing in my daughters future? I know about Edvest funds, but I was hoping to put something in my retirement but also be able to use it for her college if she wants it. I've had alot of people tell me just put it into stocks.

3) Financial advisors?? Are they worth it?

4) what should I do with the bank savings?

Thoughts?
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Old 01-26-2013, 02:05 PM   #2
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No claim to have the right answers, but here's my take on your questions:

1. Cannot speak to other people's career path choices, but mine were in technology fields and at a very few jobs I had a chance at a defined benefit pension. In ALL thiose cases, the company folded or changed the plan before I would have been eligible for any meaningful payout. I "vested" a benefit in two of them, which was later bought out (no choice) by the company based on their assessment of present value which was tiny. The benefit schedules were always heavily tilted, so a significant value was only secure after decades of work and anytime before that the company could (and always did in all the places I worked) revise the plan unilaterally to be nearly worthless. I do not regret in any way making sure I had my own retirement funds. Had I planned to rely on the company plans I would have been in bad shape.

2. I tried to strike a medium course between saving for college and retirement. I know kids can always get loans or finance college, but my parents gave me a great start by paying for my college and I want to do the same for my kids. Instead of putting a full tuition into a college vehicle, I split some into specific college tax advantaged accounts and some into regular mutual funds that were in my name. It was easy to shift that money around when one child went to a lower cost school and divert some to help him in other ways.

3. I am sure there are some good financial advisors but by the time you know enough to tell a good one from the majority who are mostly salespeople or actually don't know much of what they claim, you are knowledgeable to take care of things yourself. The vast majority are actually harmful either through bad advice they give, high fees they charge, or more commonly both. Stick to here and bogleheads.org and you will do well.

4. Bank savings are pretty miserable now. If you have some amount you want to save as Emergency Fund, you can at least split some in a savings or money market account and some you could live with waiting a few days to access into CDs.
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Old 01-26-2013, 03:10 PM   #3
Confused about dryer sheets
 
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Quote:
Originally Posted by growing_older View Post
No claim to have the right answers, but here's my take on your questions:

1. Cannot speak to other people's career path choices, but mine were in technology fields and at a very few jobs I had a chance at a defined benefit pension. In ALL thiose cases, the company folded or changed the plan before I would have been eligible for any meaningful payout. I "vested" a benefit in two of them, which was later bought out (no choice) by the company based on their assessment of present value which was tiny. The benefit schedules were always heavily tilted, so a significant value was only secure after decades of work and anytime before that the company could (and always did in all the places I worked) revise the plan unilaterally to be nearly worthless. I do not regret in any way making sure I had my own retirement funds. Had I planned to rely on the company plans I would have been in bad shape.

2. I tried to strike a medium course between saving for college and retirement. I know kids can always get loans or finance college, but my parents gave me a great start by paying for my college and I want to do the same for my kids. Instead of putting a full tuition into a college vehicle, I split some into specific college tax advantaged accounts and some into regular mutual funds that were in my name. It was easy to shift that money around when one child went to a lower cost school and divert some to help him in other ways.

3. I am sure there are some good financial advisors but by the time you know enough to tell a good one from the majority who are mostly salespeople or actually don't know much of what they claim, you are knowledgeable to take care of things yourself. The vast majority are actually harmful either through bad advice they give, high fees they charge, or more commonly both. Stick to here and bogleheads.org and you will do well.

4. Bank savings are pretty miserable now. If you have some amount you want to save as Emergency Fund, you can at least split some in a savings or money market account and some you could live with waiting a few days to access into CDs.
Thanks for the advice. I also found some great information on Bogle Heads.
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Old 02-02-2013, 08:54 AM   #4
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As a newly expecting father, I also very recently had [and still have] similar anxiety about savings and retirement. I would say, you have some time before you retire. You already have bogleheads so if you can follow an appropriate and consistent investment plan then you are all set. I would also say that I am not funding the 529 plan 100% for my kid. I do want the kid to have a stake in their education and not get everything on a platter.
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