Ok, so I've spent alot of time trolling around your wonderful place here and I really apprecitate the contributions by all. I've learned alot and it has, at least in the short term changed my views on many things. I'm looking for advice on several topics and as you all say, you need details. Hurt my feelings if you must, I'm not smart enough to take it personally anyway!! :P
Married...daughter is 3, son due in June
! No more, snip, snip. Wife and I are 32.
Social Security number is...kidding.
My wife is the bread winner in industry and I teach grade school. We have just recently started this whole LBYM thing and are sorry to have missed the ways before. Wife is still a spender, but she's trying hard. LBYM is so logical...spending is so psychological. We're struggling to be sure to fly coach, as opposed to carrying one on her arm.
Anyway back to details:
Combined income is roughly $125,000
Now saving 15% of gross to 401k/403b
Have about $80,000 combined in 401k/403b/IRA
Emergency savings: $10,000
Residence value: $400,000/we owe $270,000 on a sub 6% 30yr fixed
Rental Value: $175,000/we owe $120,000 on a sub 6% 30yr fixed
School Loan: $14k at sub 4% fixed (monthly=$97)
Family Van: Don't have the total here, sorry, $527/mo for another 2 1/2 years
No CC or other consumer debt.
With this rate of savings we are spending close to everything else, between expensive high quality childcare, tivo, internet, gym membership, life insurance, commuting, and other unnecessary, quality of life luxuries. I know this is not top notch LBYM, but we're taking baby steps. We really like our life right now and are looking only to continue our lifestyle at a not-so-early ER. We're thinking 55 to 60. I should have a 25k (inf. adj.) pension (50k if I work til 60) without health ins (come on national health care!) . I'm not counting on anything from SS (although I really do think, it will be there in some form). The rest will be from the egg. Houses will be paid by then, kids through college, and so on.
If I'm not willing to save anymore, does it make sense to save to a Roth rather than the 401k/403b? I know to at least get the wife's match, but should I be saving less in the work plans to save into a roth. I'm thinking that I'll probably not be in a much lower bracket after I retire, but who knows what taxes will look like in 25 years.
Any thoughts on 529's for the kids. If you like 'em, which states do you prefer?
Are we not saving enough to continue a lifestyle that we're accustomed to? I know we have 25 years on our side, but is it enough?
What assumptions can I use? Is 3% inflation realistic over the next 25 years. What about market appreciation...5%, 6, 7, 10? What is reasonable over that length of time?
The rental is losing a little bit before the tax benefit. After taxes, I'm good. Is this a bad investment? I'm looking for the long term. Someday it'll be paid for and rented right?
Allocations for someone with my time frame would be helpful. I'm largely in index funds and target funds. Less than 10% bonds. Most of my NW is obviously in RE. Good or bad, I'm in for the long haul there.
I know lots of you can live on Ramen and white rice. I appreciate your strength. I am spoiled and I know it. But any thoughts you have on how I can best invest or prepare to retire would be appreciated.
Thanks again, and I love this place.