Hi, all! Glad I finally got the courage to post our situation here. We welcome any feedback. Here's a quick look at our finances:
Life Situation:
Me - 35
Wife - 36
1 child - 9 months
MFJ living in HCOL in CA
Income (monthly):
15k gross (10k from wife and 5k from me)
7k net (3k from wife and 4k from me)
Pre-tax deductions (monthly):
1.3k goes to 401k, HSA, Insurance, and Dental
Other income:
I have a side business that generates anywhere from $50-500 monthly but I don't tend to count it since this is very inconsistent.
Adjusted Gross:
123k as stated by 2017 income tax return
Taxes (monthly):
$1261 Federal
$589 State
$620 FICA
Expenses (monthly):
Core
Mortgage - $2890
Property Tax - $705
Homeowners - $60
Car Insurance - $120
Utilities (gas/electric/water/trash/internet) - $160
Groceries - $300
Car payment - $460 (16k left at 0%)
Car maintenance (gas/registration/oil change) - $150
Discretionary
Travel - $400 (includes airfare, car rental, hotel, food)
Restaurants - $200
Clothing/Shoes - $50
General Merchandise - $50
Home Improvement/repair - $20
Personal Care - $20
Gifts - $40
Donations - $40
Total - $5665
Assets:
401k - $106k
Roths - $81k
Taxable - $82.5k
CDs - $70k
Emergency Fund - $30k
Cash - $25k
Total - $394.5k
Liabilities:
Mortgage - $587k remaining 3.75% 30 year loan (year 3). Original amount was $623k
Car loan - $16k remaining 0% 4 year loan (year 1)
Our goal is for my wife to either quit or work part time in 5 years to be at home with our child. My income can cover the mortgage, property tax, insurances and utilities which totals close to $4k. Our plan is to save enough in 5 years so that a 4% withdrawal will cover the remaining expenses (about $18k). I don't plan to retire since I love my job and it is very flexible. I own my own business and even though I can increase my income, I'm not counting on this happening as part of my worst case scenario. Do you think it's feasible? Or am I too optimistic about this plan? Thank you in advance for all your input.