My family lives in the high-cost Bay Area and we spend about $100k per year on everything, housing is about 40%, child care 20%, and 40% for everything else. This year, we'll make about $180K including my wife's 403b match. We are 40 with 2 small children.
We are thinking of going part time (maybe between 66% and 75% in the next year or so. That would take our salaries to about $140k. The question has to do with whether or not to max out our retirement savings in the next few years.
If we max out our Roth IRAs ($11000) and 403b (2 of them) and 457b (1 of them) we could contribute $63500. But then our salaries would not cover our expenses. However we have about $500k in taxable accounts that could be used to pay the deficits. We also have $700k in retirement accounts. In the past we have not maxed out our contributions to retirement to make sure that we can cover our expenses and our taxable accounts have grown as a result, but I'm wonder if it makes sense to send the taxable accounts on expenses and max out our tax-advantaged retirement accounts.
The main confounding issue is that we are planning to retire in 3-6 years (probably sooner for me and later for my wife). I've read through some forum topics about whether to max out retirement when we are so close to retirement, but I'm not sure if these circumstances are different or not. Unfortunately, for most of my career, I've been maxing out the 403b and not the 457b since we had not really thought about RE.
Anyway, I think it maybe makes sense on paper to do this, but I'm wondering if there are any downsides to this or things that I should be aware of. I think having flexibility is important so I'm a little worried that sticking everything into retirement accounts even though one is a 457b might cause problems in retirement.
thanks!