I've recently been in contact with some financial advisers, and they've noted that I'm putting a lot into retirement accounts (about 34% of my take-home pay). I told them that I've been considering early retirement, or at least would like to have the option when I reach that age. But it did get me thinking, am I putting too much money into retirement?
Bio:
I am currently 24, a renter (600/mo), making about 50k gross (raise to 62k in May). I have 8 months savings in an emergency fund (20k), max out my Roth IRA (5500 for 2013), contribute $550/mo to the TSP (military 401k, no matching), and have been holding the leftovers (a few hundred per month) in a checking account, or spending it on my newly acquired girlfriend.
I'm in the military and anticipate moving for much of my career. I go back and forth on home ownership vs renting, so it has been difficult to determine if I should be saving for a down payment on a home. I have recently felt that the 8 month emergency fund might be a little excessive, as it is pretty unlikely that I'll suddenly find myself without income.
I guess my real decision is, should I cut back on the TSP contributions and instead use those funds for more short/mid-term investments (future home down payment, a ring some day, future child's education) until my income reaches the 25% tax bracket, at which point I might consider putting more into the TSP to reduce taxable income?
Accounts:
Retirement
Roth - 24k
TSP - 7k
Short/Midterm
30k, mostly mutual funds
Cash
22k, low interest savings/checking accts
Debt
25k @ 0.5% interest (USAA career starter loan, 600/mo payment)
Thanks in advance, and please let me know if I need to clarify anything.
Bio:
I am currently 24, a renter (600/mo), making about 50k gross (raise to 62k in May). I have 8 months savings in an emergency fund (20k), max out my Roth IRA (5500 for 2013), contribute $550/mo to the TSP (military 401k, no matching), and have been holding the leftovers (a few hundred per month) in a checking account, or spending it on my newly acquired girlfriend.
I'm in the military and anticipate moving for much of my career. I go back and forth on home ownership vs renting, so it has been difficult to determine if I should be saving for a down payment on a home. I have recently felt that the 8 month emergency fund might be a little excessive, as it is pretty unlikely that I'll suddenly find myself without income.
I guess my real decision is, should I cut back on the TSP contributions and instead use those funds for more short/mid-term investments (future home down payment, a ring some day, future child's education) until my income reaches the 25% tax bracket, at which point I might consider putting more into the TSP to reduce taxable income?
Accounts:
Retirement
Roth - 24k
TSP - 7k
Short/Midterm
30k, mostly mutual funds
Cash
22k, low interest savings/checking accts
Debt
25k @ 0.5% interest (USAA career starter loan, 600/mo payment)
Thanks in advance, and please let me know if I need to clarify anything.
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