Housing market is nuts and I’m thankful we bought when we did. My house has (supposedly) gone up in value ~50% since I bought it four years ago despite mortgage rates being ~150% higher — how are people making those numbers work?
We’re working on front loading 529’s. The goal is to have enough in each to cover four years at a good in state university plus some buffer. Obviously they might literally do something different but it feels like a good baseline. Finishing this front loading is one of the items on our pre-FIRE checklist as the plan is to pull the trigger long before they’ll go off to college.
Weekly question:
For those with kids, what are your plans for college? How does it factor into your retirement plans?
Nothing I’d recommend. I use Betterment for my brokerage but only because having a managed account exempts me from some employer imposed holding requirements.
I’m guessing it’s federation related? I frequently see comments, replies, or new posts pop up long after they were “created”. The lemmy experience is far from smooth right now.
We’ve done it twice. The first time was probably the most common and boring story— we bought a house. It was planned and we’d been intentionally living cheaply to save up.
The second was when my wife stopped working. This was during Covid when all the return to office stuff started and we’d just had our first kid. Now we’ve got two and she’s (mostly) a stay at home parent with a passion/hobby business.
Does that mean the instance owner was okay with the content and new nazi population?
I’d take this a step further and say I have existential dread when I think of all the talented / smart people that get pulled into my industry and provide very little if any societal good.
In clickbait headline form: Retire decades earlier with this one trick!
We’re in a high enough tax bracket that I struggle to envision a scenario where we’re not better off maximizing what pretax spaces we have right now. That said we also make backdoor and megabackdoor Roth contributions and have a sizable taxable brokerage balance. It wasn’t by design but we’ve ended up with a good split across each bucket.
Question for the week: Do you think about or optimize for tax diversification in retirement? For example, are you intentionally diversifying between Roth, pre-tax, and taxable accounts as a hedge against future tax code changes?
I don’t really spreadsheet on a monthly basis but I did pull up the empower app — all time high indeed!
Presumably the 8-30k would otherwise be invested in your taxable brokerage, seems to come down to a question of risk tolerance. At that balance It’s very unlikely you’d find yourself in a situation where you couldn’t pull those totals out of the brokerage even in a severe market downturn. It’s true in that situation you’d be selling down, but keeping it cash forgoes market returns in the mean time.
Personally I’m pretty risk averse and like to keep a cash buffer in HYSA/CDs/I bonds despite having a significant taxable brokerage balance. This was true even before the interest rate situation became more favorable.
None of the approaches you’ve listed seem outright wrong for your situation. I’d concentrate on what your risk tolerances are and back out your approach from there.
We recently hired a cleaner to come in twice a month which has been a big help, especially now with two very young kids.
My question of the week: For people in the boring middle, what are you doing, if anything, to make life better now? Doesn’t have to be financial.