Nice to meet all of you!!

[HatePayingTaxes]

Hi,

To introduce myself, I'm 31 and married with 2 kids (16 months and 2 months old.. very cute). Been saving since college and lived a frugal lifestyle every since I can remember. I've relaxed a bit but still living within my means. Had some money fights b/c my wife was a bigger spender but we eventually came to a mid point where I'm more of a spender now and she's more frugal. I think we have a good budget system going, which helps tremendously with not only saving but with open communciation and keeping each other accountable.

Here's our current situation:
210k in roth / 401k (trying to rollover everything to roth)
160k in ing electric checking
15k/15k each for our kids 529 plan

Our plan is to continue to max our 401k regular/roth and also our roth ira. Also, put in another 3k each into our kids 529 plans every year. Any savings outside of that is gravy. I honestly don't care if we don't save anything beyond this. Until I was about 27, I was all about save, save, save but, these days, I really don't see the point of saving outside of tax deferred plans as long as we have emergency fund. Actually, I used to be all about planning, creating spreadsheet, and following it very strictly but I've loosened up a lot. I think, after a certain point, I've realized what's the point of saving as long as my tax deferred accts are covered. It's great to see that savings acct number going up but what's the point? We live within our means and we're going to keep it that way so what's the importance of seeing that number going up? I think, after electric checking hit 100k, it just felt like a number at that point. We said, ok, why don't we give each other 5k bonus to spend when it hits 100k on whatever we want but then, we were thinking, what am I going to spend this on? We have a tv, laptop, can't travel b/c of kids, don't really shop... it's pretty meaningless to spend 5k on useless stuff so we just said, forget it, we don't need that bonus. So I think that's where my thinkings coming from... it just seems like a number and it's hard to relate to it so don't see the point of focusing my energy to making that number go up. More important to spend that energy playing with kids and spending time with wife. If I have to forgo a better paying job with more work hrs, so be it.... don't need that extra money anyway.

Our main issue going forward will be whether to buy a house. We've been comtemplating about buying a house in the suburbs b/c of the kids and we'll use 100k from ing to do that. We don't necessarily want to buy a house but I think we're at that point in our life where we feel the need to settle down.

Feel free to give any advice and poke holes in any of the things I wrote. Nice to meet all of you!!!!

[Midpack]

Quote:

Originally Posted by HatePayingTaxes I think, after a certain point, I've realized what's the point of saving as long as my tax deferred accts are covered. It's great to see that savings acct number going up but what's the point? We live within our means and we're going to keep it that way so what's the importance of seeing that number going up?

1) Welcome aboard.
2) You're way ahead of the game at your age, good for you (seriously).
3) At some point you may want to retire, but there's no way you can know that for sure yet. To give yourself that option, for a 30 year retirement let's say, you'll need (rule of thumb) 25 x your expenses at retirement age. You're young, so if you think you'll need $100K/year to live the life you want beginning at age 65 - current thinking is you'll want to have $2,500,000 to work with. [Based on 4% SWR, often debated but a good planning 'rule of thumb.'] The sooner you start that accumulation, the easier it will be and the more options you'll have. That's "the point..." IMO. If you can accumulate all you need in tax deferred, great. I did not have enough tax deferred accounts to work with myself even with a 401k, HSA, 2 TIRA's and 2 Rollover IRA's.

Best of luck, again you're in the catbird seat, up to you where you go from here...

[walkinwood]

Welcome!

Like Midpack says, try to estimate how much you'll need to be financially independent. Account for inflation. Then, you can determine if your tax-deferred savings will meet that need or if you'll need to save more. Try Firecalc - see link at bottom of this page.

[kumquat]

As they other posters have said, try to decide how much to save and save it. That being said, don't be the richest guy in the graveyard.

[FUEGO]

Quote:

Originally Posted by HatePayingTaxes To introduce myself, I'm 31 and married with 2 kids Here's our current situation: 210k in roth / 401k (trying to rollover everything to roth) 160k in ing electric checking 15k/15k each for our kids 529 plan Our plan is to continue to max our 401k regular/roth and also our roth ira. Also, put in another 3k each into our kids 529 plans every year.

We are in a very similar place in life (age, #kids and roughly similar ages), we have roughly the same amount saved (well, maybe a little more ), and we save roughly what you do (ie max our tax deferred savings, then a little taxable savings).

You are definitely on the right track. Even if you cut back on saving (ie you or your wife quit working or got laid off), you would be doing ok probably with all those savings/investments.

Quote:

So I think that's where my thinkings coming from... it just seems like a number and it's hard to relate to it so don't see the point of focusing my energy to making that number go up. More important to spend that energy playing with kids and spending time with wife. If I have to forgo a better paying job with more work hrs, so be it.... don't need that extra money anyway.

I just put my investments on autopilot for the most part. Between a job, kids, and a wife, you have enough fun distractions to not worry about calculating your FIRE date or savings rate or months to retirement every day.

[HatePayingTaxes]

Thanks for the comments. I've tried FIRE calc maybe a year ago and it said I'll be ok. It's mainly b/c our spending is low... we need about 37k/yr (been tracking actual expenses for the last two yrs) to get by so we'll be ok by only contributing to tax deferred accts. I'm planning to work full time until my kids finish college and then possibly scale back to part time to cover necessities until I'm 59.5. I'll be in my early 50s when kids finish college so still relatively young to enjoy.

Yes, I agree. Kids, work, and other responsibilities are keeping me very busy so don't have time to focus on investments as much as before. That's why asset allocation is so helpful I think. Just keep DCA/rebalancing into pre-made asset allocation and set it and forget it.