Hi everyone, new to the board and I have been trying to save for the past 7 years without much guidance besides reading articles. I come from a family that spends every last dollar and is relying on social security and I don't want to go down that path. I have a goal of retiring by 57 at the latest, but early 50's would be more ideal. I don't know if it is possible and was wondering if I could get some advice on how I'm doing and my current investment strategies.
Background.
Me-32 y/o; wife, 2 kids, and mom
401K: $114,000; currently maxing out at $18,000 / yr
Roth IRA: $30,000; currently not contributing
Debt:
Mortgage: $257,000 @ 4.625% (beginning 2/7/14); Pay $350 extra / month
Car: $20,000 @ 1.9% (beginning 6/1/15); will start paying $500 more per month beginning in April to pay it off.
I got a few questions.
1. I quit contributing to Roth and started maxing out my 401k since my wife and I are in a higher tax bracket now than I think we will be when we retire. Is this the right thing to do?
2. I love the idea of having no debt, so we are paying extra in the mortgage and car, which totals an extra $850/month. The reasoning is that I have the ultimate goal to have no debt so my wife can begin to work less and it just makes me feel good that I don't owe anyone money. Would it be wiser to use this extra money to fund the Roth, open another 401k for my wife, or quickly pay off my debt?
3. Last but not least, am I just dreaming about early retirement or do I look like I'm on the right path for retiring in my early 50's?
Thanks for taking the time and for your input!
Background.
Me-32 y/o; wife, 2 kids, and mom
401K: $114,000; currently maxing out at $18,000 / yr
Roth IRA: $30,000; currently not contributing
Debt:
Mortgage: $257,000 @ 4.625% (beginning 2/7/14); Pay $350 extra / month
Car: $20,000 @ 1.9% (beginning 6/1/15); will start paying $500 more per month beginning in April to pay it off.
I got a few questions.
1. I quit contributing to Roth and started maxing out my 401k since my wife and I are in a higher tax bracket now than I think we will be when we retire. Is this the right thing to do?
2. I love the idea of having no debt, so we are paying extra in the mortgage and car, which totals an extra $850/month. The reasoning is that I have the ultimate goal to have no debt so my wife can begin to work less and it just makes me feel good that I don't owe anyone money. Would it be wiser to use this extra money to fund the Roth, open another 401k for my wife, or quickly pay off my debt?
3. Last but not least, am I just dreaming about early retirement or do I look like I'm on the right path for retiring in my early 50's?
Thanks for taking the time and for your input!