Author Topic: Case Study - New member looking for help/advice  (Read 2036 times)

anxiousclothing

  • 5 O'Clock Shadow
  • *
  • Posts: 9
Case Study - New member looking for help/advice
« on: September 24, 2017, 11:26:30 PM »
Let me begin that I am stubborn. My wife finally convinced me to read DR book in March 2017 and it changed our lives….finding MMM has turned our world upside down. In March we cut up our credit cards and in 7 months we were able to completely remove all debt minus mortgage, establish emergency fund, establish a small savings account, prefund upcoming month vs being month behind. (I worked many many extra hours) To speed up the process, we temporarily suspended 457 contribution and we know we need to start contributing again. We file MFJ and we have four children on a single income. My wife stays at home with the kids.

Debt
$132,665 (Home)
No credit cards
No student loans
No vehicle debt

Emergency Fund = $25,450
Savings in bank for upcoming expenditures = $5,000
457 = $9097
Roth IRA = $15,466

Cars
1993 Mazda PU Truck -$2,000
1999 Chevy Tahoe - $4,000
2007 Honda Odyssey -$8,000

Home purchased in December 2011 for $163,000. Appraised value when purchased home was $170,000. $153,000 Loan to purchase home @ 3.99% interest rate. $132,665 remaining on loan.
Mortgage payment = $729.57
Taxes = $84.87
Insurance = $65.17
Total payment = $879.61

Attached below is a excel spreadsheet monthly budget that we created. I know there shouldn’t be two columns and we are working towards merging them. My job currently has a lot of overtime available and it will be diminishing in the next few months. The overtime has allowed us to obtain our current situation listed above. The two columns represent normal monthly paycheck vs overtime monthly paycheck. Further down is an example of my paychecks.
1. We are in the process of changing/fixing the internet and cell phone line item.
2. Also, the weight loss line item is not a continuous long term line item.  Our financial “jump start” is helping my wife and I “jump start” our health back to normal as well.
3. The yellow categories represent cash envelopes while we learn our new spending habits and everything else is Bill pay.

I am paid every other week for total of 26 paychecks. I have given two different examples of my paychecks. One is without overtime and one is with overtime.

Gross No Overtime (MFJ and we have four children)
$2,666.89

Deductions from Gross
Flex spending account  $23.00 2018 will be maxed out $100
FPPA (Defined Benefit Pension=9% + Company Match) $253.35
Health Insurance $26.29
457 (no match) was putting in $70 Currently $0

Taxes $261.96

Adjustments to Net Pay
FF Fund (Condiments) $2.50
Union Dues $30.85

Net
$2082.94

Gross W/ Overtime (MFJ and we have four children)
$5,163.85

Deductions from Gross
Flex spending account  $23.00 2018 will be maxed out $100
FPPA (Defined Benefit Pension=9% + Company Match) $253.35
Health Insurance $26.29
457 (no match) was putting in $70. Currently $0

Taxes $858.16

Adjustments to Net Pay
FF Fund (Condiments) $2.50
Union Dues $30.85

Net
$3969.70

Did I forget anything? I recently transferred my Roth IRA to Vanguard. I don’t have any other investment accounts other than Roth IRA, 457, and Pension. Where should my leftover money go? Max out Roth? 457? Other? What can I do better? It is challenging with varying paychecks to narrow down budget. Next year we will max out our FSA account which will be $2600/yr. Im trying to be like a duck by remaining cool above the water but am paddling like hell underneath while I try to learn as much as I can. Thank you in advance for your time, input, and suggestions.

Frankies Girl

  • Handlebar Stache
  • *****
  • Posts: 2481
  • Age: 2012
  • Typical Ghoul Next Door
Re: Case Study - New member looking for help/advice
« Reply #1 on: September 25, 2017, 04:44:01 AM »
Great job on the turnaround and killing your debts! But I do see several areas that are definitely going to be facepunch-worthy... apologies if it seems harsh (not intending to be mean, just very blunt so it registers - which is the point of a "facepunch" on this forum). If you did make some further changes, you likely would be doing REALLY well and on track for a decent retirement that might just be a bit earlier (no idea how old you are but 4 kids, I'd say you have to be at least in your mid 20s-30s).

The fact that there is no $ in your budget for dental, clothing, college funding (although you and your wife's retirement funds should take priority over college) and have a very wasteful mulitvitamin MLM scam in there (advocare)? Yikes. That crap is... well, crap. So glad that's going away, but it's disturbing you had it in there at all. If you got any benefit from it, it was a placebo effect, and spending $200 a month on something awful like that should be a wakeup call. Garbage supplements are not the way to be healthy.

Glad you realize the cell phone situation is silly as well. That could be waaaaaaay less than you're paying.

On a single income with that many family members, it's is wrong IMO you tithe 12 THOUSAND DOLLARS A YEAR. I get that church obligations can sometimes be a touchy subject, but logically that is not in any way a good use of funds. You should reduce that significantly (especially if you are basing it off of gross salary, plus overtime which is going away). I'd cut that in half (at least) and donate time instead to do volunteer work if you feel an obligation to your church, but that's crazy you prioritize that much money over funding your dental, your medical or your own retirement/future, or even saving a bit for your children's college.

Why on earth do you have 3 cars? Lose one and reduce your insurance and maintenance payments.

Do you have an IRA for your spouse? Not sure if the Roth IRA is a single one or combined amounts from yours and hers, but in any case you are woefully underfunded for retirement accounts and you can fund both your own and a spousal IRA (as long as you make under the IRA limits to open one in the first place). It's only going to allow you a max of $5,500/yr per person, but it's better than your current contributions. And yes, you absolutely should be funding your 457 as well if not maxing it out - find the least expensive broad market fund and go hard into it (maybe use the money cut from the tithing?). See the investment order post to figure out what should go where in what priority.

Station meals, food storage, eating out and groceries - your family of 6 (and I'm going to assume your children are not all teens so do not require adult sized meals) spends over 1,200 a month on eating. That's crazy. Groceries are at $900? Your wife stays home? One of her jobs is to get that budget/food prep down. I read several bloggers with large families (including Frugal Girl, who has 4 kids - 2 teens and 2 tweens - she posts about her grocery breakdowns and great recipes/budgeting, is a one income family and also religious) and their food budget is quite a bit less than this. You can do better, but it may mean taking a hard line on what brands are purchased and batch cooking. Shop the sales/loss leaders. Check out places like Aldi if you have one nearby. Reduce expensive meats and eat more veggies/beans/rice. Meal plan for the week and cook in bulk, freeze portions for later so you're not eating on the same thing and get bored (unless you like leftovers - we do in my family and eat till it's gone). Cut out things like juice and snacky junk food. Budgetbytes.com has fantastic recipes and great breakdowns on pricing. No idea what station meals actually means, but if you can, you should be packing a lunch not buying one. And paying $100 a month for food storage is just blowing my mind... really, what is this and why is it even necessary?

Right around $500 a month on things like presents and "fun stuff" and date nights. I get that fun stuff should be in the budget, but there are ways to do so cheaply. Public parks, library (with lots of fun free programs for kids and adults), you already pay for the Y membership, so that counts as fun as well so right there we're up to almost $600/month... but they do include free child watch and have a huge variety of activities for both kids and adults you should be taking advantage of.

What about friends or family that can watch the kids, or arrange to have a babysitting share where you watch friend's kids one day a week and they watch yours on another day so everyone gets some date night time at no cost? And do special occasions always equal spending money? What about making things/crafting for presents for any adults, a few small presents for birthdays/x-mas for the kids and then doing something for your community/church on special occasions - to both appreciate what you have and are building on while teaching your kids that community service is a gift to both them and their society?

« Last Edit: September 25, 2017, 04:51:15 AM by Frankies Girl »
I frequently have no idea what I'm talking about. Like now.

FIREd as of: March 6th, 2015!

Ting is awesome! Get $25 if you use my referral code: https://z0p1rd31m89.ting.com/

former player

  • Magnum Stache
  • ******
  • Posts: 2524
  • Location: Avalon
Re: Case Study - New member looking for help/advice
« Reply #2 on: September 25, 2017, 05:51:36 AM »
You have done well so far, and I'm seeing a level of self-knowledge and organisation which bodes well for you doing even better in the future.

I agree with everything Frankies Girl has said about your spending.  Particularly the tithing, which is way over the top for anything any reasonable church would require of you.

Where you spend your money is a statement of your priorities in life. At the moment you are giving no priority at all to your wife and children being clothed and having their teeth looked after, and you are giving no priority at all to your children being educated past high school.  All three of those failures reflect very poorly on your priorities: in particular you are setting your children up for needing other people's charity in these respects.

My view is that you should tithe regularly 10% of your net regular income, and then look at giving more from any overtime you earn to specific charity projects, whether at your church or otherwise, which you think are great value for your family's money.  But put your own family's lifebelts on first.

Be frugal and industrious, and you will be free (Ben Franklin)

SimpleCycle

  • Bristles
  • ***
  • Posts: 322
  • Location: Chicago
Re: Case Study - New member looking for help/advice
« Reply #3 on: September 25, 2017, 06:09:12 AM »
Tithing is a sacred requirement of the LDS church, so while you may not agree with it, OP is unlikely to view that part of the budget as negotiable.

OP, I commend you for turning things around.  I have some thoughts that I'll have to come back and post because I have to run right now.

marty998

  • Magnum Stache
  • ******
  • Posts: 4803
  • Location: Sydney, Oz
Re: Case Study - New member looking for help/advice
« Reply #4 on: September 25, 2017, 07:07:05 AM »
Case study has a lot of potential, but yeah wow, the tithe is excessive (20%!)... Do you at least get a tax deduction for it??

And the food storage... what is that??

I like the way former player has written it... put your own family's life jackets on first.

NeonPegasus

  • Bristles
  • ***
  • Posts: 299
  • Location: Metro Atlanta, GA
    • Neon Pegasus
Re: Case Study - New member looking for help/advice
« Reply #5 on: September 25, 2017, 07:39:29 AM »
Let me begin that I am stubborn. My wife finally convinced me to read DR book in March 2017 and it changed our lives….finding MMM has turned our world upside down. In March we cut up our credit cards and in 7 months we were able to completely remove all debt minus mortgage, establish emergency fund, establish a small savings account, prefund upcoming month vs being month behind. (I worked many many extra hours) To speed up the process, we temporarily suspended 457 contribution and we know we need to start contributing again. We file MFJ and we have four children on a single income. My wife stays at home with the kids.

Debt
$132,665 (Home)
No credit cards
No student loans
No vehicle debt

Emergency Fund = $25,450
Savings in bank for upcoming expenditures = $5,000
457 = $9097
Roth IRA = $15,466

Cars
1993 Mazda PU Truck -$2,000
1999 Chevy Tahoe - $4,000
2007 Honda Odyssey -$8,000

Home purchased in December 2011 for $163,000. Appraised value when purchased home was $170,000. $153,000 Loan to purchase home @ 3.99% interest rate. $132,665 remaining on loan.
Mortgage payment = $729.57
Taxes = $84.87
Insurance = $65.17
Total payment = $879.61

Attached below is a excel spreadsheet monthly budget that we created. I know there shouldn’t be two columns and we are working towards merging them. My job currently has a lot of overtime available and it will be diminishing in the next few months. The overtime has allowed us to obtain our current situation listed above. The two columns represent normal monthly paycheck vs overtime monthly paycheck. Further down is an example of my paychecks.
1. We are in the process of changing/fixing the internet and cell phone line item.
2. Also, the weight loss line item is not a continuous long term line item.  Our financial “jump start” is helping my wife and I “jump start” our health back to normal as well.
3. The yellow categories represent cash envelopes while we learn our new spending habits and everything else is Bill pay.

I am paid every other week for total of 26 paychecks. I have given two different examples of my paychecks. One is without overtime and one is with overtime.

Gross No Overtime (MFJ and we have four children)
$2,666.89

Deductions from Gross
Flex spending account  $23.00 2018 will be maxed out $100
FPPA (Defined Benefit Pension=9% + Company Match) $253.35
Health Insurance $26.29
457 (no match) was putting in $70 Currently $0

Taxes $261.96

Adjustments to Net Pay
FF Fund (Condiments) $2.50
Union Dues $30.85

Net
$2082.94

Gross W/ Overtime (MFJ and we have four children)
$5,163.85

Deductions from Gross
Flex spending account  $23.00 2018 will be maxed out $100
FPPA (Defined Benefit Pension=9% + Company Match) $253.35
Health Insurance $26.29
457 (no match) was putting in $70. Currently $0

Taxes $858.16

Adjustments to Net Pay
FF Fund (Condiments) $2.50
Union Dues $30.85

Net
$3969.70

Did I forget anything? I recently transferred my Roth IRA to Vanguard. I don’t have any other investment accounts other than Roth IRA, 457, and Pension. Where should my leftover money go? Max out Roth? 457? Other? What can I do better? It is challenging with varying paychecks to narrow down budget. Next year we will max out our FSA account which will be $2600/yr. Im trying to be like a duck by remaining cool above the water but am paddling like hell underneath while I try to learn as much as I can. Thank you in advance for your time, input, and suggestions.

You should be living as if you'll never get another hour of OT. Your emergency savings look pretty good at about 6 mo of expenses.

- Savings - this should shift to retirement savings now that your EF is in a good place
- Identity theft - I know you don't have anything in this category but this category shouldn't be on your sheet ever. Don't go back to spending money on that.
- Emergency preparedness - how is this different from saving in an emergency fund? You've got your EF. Redirect that money.
- As another poster mentioned, $1200 in food costs for 6 people bears major scrutiny. My grocery bill for my family of 5 is around $650-700/mo for reference. $15/shift for food is crazy. Start bringing homemade food.
- Dental - is this a $0 item because your health insurance covers it? If not, you need to budget for this.
- Sell either the Tahoe or the pickup. There's no need to pay the gvt for the privilege of having one sit around all the time. Put that money towards retirement.
- If you drop to Cricket, you'll pay only $70/mo and that's for two full service lines with great coverage. There are even cheaper options out there.
- How does YMCA drop to $5/mo and still exist? Given what you said about your health, I don't necessarily think you should drop this as long as you're using it; however, if you're having to pay for childcare, it's worth investigating ways to make it work without paying for that (i.e. alternating workout times with your wife)
- Advocare - drop it. You can achieve whatever weight loss/health goals you want without paying that much.

After adding up all of the savings I mentioned, that will drop over $1k from your budget. But you'll still be nearly $500 over budget when you don't have OT income. AND that doesn't take into account things you haven't budgeted for, like clothes. That is going to break you when OT dries up.

I didn't bring it up before but the tithing is excessive. The Christian tradition is ~10% but you're way over that. If your monthly regular pay is $4165.90, shouldn't your tithing be closer to $416.59? Dropping your tithing to a lower level (~10% of net) would do a lot to close the gap without requiring you to sacrifice more retirement savings.

MrsWolfeRN

  • Bristles
  • ***
  • Posts: 343
Re: Case Study - New member looking for help/advice
« Reply #6 on: September 25, 2017, 07:51:35 AM »
The pay information is for every 2 weeks, so the tithe is 10% based on months with overtime. I am not going to argue with this.

Agree with other commenters on reducing the grocery bill, getting rid of the third car, the vitamins, and of course the cable..
I too am curious what the "food storage " item is. If it is a rented meat locker then buy a chest freezer and it will pay for itself in a few months. Also what is the $50/month for emergency preparedness?

What I have to add: I want to make sure you are aware that you can only roll over $500 of unused FSA funds each year (funds above this amount go back to your company), so only put in what you think you will actually spend on deductibles and copays. Your health insurance is cheap. If your company has several plans available it might be in your best interest to go with a more expensive plan that covers more, since you have six people on there. You will have to run the numbers based on expected usage.

I personally think $25k is too much cash to have collecting dust in a savings account. Can you use part of it to fund your and your wife's IRAs for the year? Traditional or Roth will depend on your tax bracket, see investment order thread. Roth has the added benefit of being able to withdraw contributions if an emergency occurs, but you cannot put them back.

I think you should absolutely increase your 457 contributions by the amount you are able to cut your budget each month. Then each time you get a raise or overtime, increase your contribution by that amount until you are at $18k per year.


SimpleCycle

  • Bristles
  • ***
  • Posts: 322
  • Location: Chicago
Re: Case Study - New member looking for help/advice
« Reply #7 on: September 25, 2017, 11:05:42 AM »
I strongly agree that you need to cut your budget to live on the amount without overtime.  Then you can treat the entire overtime amount as going toward your financial goals, much like you did when getting rid of debt.  That means you need to bring your total budget down to less than $4500 per month.  Here are my specific suggestions:

-Three cars really stands out as a place to cut.  Even paid off, they cost registration and insurance. ($35 savings/month)
-I'm a pretty big defender of tithing, but I would make sure you are tithing 10% of whatever you actually take in, so less in months with less overtime. (Base tithe of $578 in non overtime months)
-Groceries, groceries, groceries.  This is an area your wife can make a big dent in as a SAHM.  More things from scratch, fewer convenience foods, etc.  Aldi if you have it, whatever the discount grocery store is if you don't. ($200 savings/month)
-Emergency preparedness and food storage - how do you feel your current levels of food storage and emergency preparedness are?  I would cut this in half and just slow down the pace of accumulating reserves.  Also, this should go away at some point, right, or at least be greatly reduced?  This is another area where prudent home economics can really help.  You should be rotating the short term storage items so that nothing goes to waste or expires.  There are tons of resources on the internet about how to do food storage economically - I'm not LDS but have used them for our own emergency preparedness. ($75 savings/month)
-How many meals does station food pay for?  If it's a substantial number of your meals, I think you can cut groceries even more. ($50 savings/month)
-Dental - add me to the chorus wondering why this is zero.
-Cell phone - you can do better by switching to a lower cost provider like Cricket, Boost Mobile, or Republic Wireless.  I'm pretty curious about Mint SIM but haven't taken the plunge yet. ($50 savings/month)
-Utilities - your estimate seems on the high side to me, and I'd make sure you're doing basic energy efficiency things but don't go wild spending money on energy efficient improvements. ($10/month)
-TV and Internet - I think you can call your company and try to cut this a bit by negotiating or lowering your package by one level. ($20/month)
-Clothing - you can probably get away with $0 for a while, but this needs to be budgeted. (+$100/month)
-Vacation - I would fund this exclusively out of overtime, so remove it from your base budget ($175 savings/month)
-Advocare - nope.  You can't afford this and there are lots of free ways to be healthy. ($200 savings/month)
-Fun/misc/babysitter - I would try to do date nights in after bedtime, depending on the age of your kids.  You can each take a turn planning one, which is half the fun.  I get ideas by looking up reviews for "date night box" services and borrowing the ideas.  Misc. is realistic, but try to track it in categories. ($50 savings/month)
-Celebrations (birthdays, holidays, Christmas) - this is an area where you really can economize.   Can you spend $100/kid on birthdays and the adults only get homemade cards?  I'd try to cut Christmas by $500 unless that includes something like travel. ($58 savings/month)

That should get you to living on only the non-overtime salary with enough left over to put money into Roths (split evenly between you and your wife).  That is how I suggest you do the "extra", first to the Roths, then to the 457.

Another thing I want to comment on is it sounds like your wife is motivated to change your financial situation as well, since she introduced DR to you.  Harness her energy for change into a big team effort and I think you'll be unstoppable.

hoping2retire35

  • Handlebar Stache
  • *****
  • Posts: 1085
  • Location: UPCOUNTRY CAROLINA
Re: Case Study - New member looking for help/advice
« Reply #8 on: September 27, 2017, 03:07:44 PM »
op, where ya at?

I am confused by your posting. You list two different net incomes; one without overtime($2000) and one with.($4000). However you appear to add the two together in your budget excel, because neither one X2 equals $6k. What is your income?

Sun Hat

  • 5 O'Clock Shadow
  • *
  • Posts: 68
  • Location: Canada
Re: Case Study - New member looking for help/advice
« Reply #9 on: September 28, 2017, 10:57:42 AM »
Tackling the grocery bill and improving your health can go hand in hand if you've been buying ready-made or processed foods. If you aim to buy foods in a form that resembles what they looked like in nature, odds are that it won't contain added sugar, salt or fats. Think to shop the perimeter of the store. Foods in their natural state will also have more nutrients, so that you can drop the Advocare. If you feel sluggish, just make sure that your meals contain at least 3 food groups (this is something that I have to be mindful of, or I fall into a habit of eating only buttered pasta and wondering why I'm tired).

While it will be a bit more work for your wife, you'll get healthier meals, and it'll teach your kids some handy life skills. I'm guessing by your line items for emergency preparedness and food storage that you're interested in building in resilience and planning for disasters. Consider how useful it is to know how to cook from scratch. Cooking is also a good way to teach kids fractions, which may be useful depending on the age of your kids.

I'm guessing that the station meals are meals provided at either a police or fire station. If so, then I think that there are probably easier things to cut out, though you may want to bring extra fruit/veg so that you can eat smaller portions of the tasty/unhealthy foods that may be on offer.

Sun Hat

  • 5 O'Clock Shadow
  • *
  • Posts: 68
  • Location: Canada
Re: Case Study - New member looking for help/advice
« Reply #10 on: September 28, 2017, 04:28:52 PM »
I have a suggestion regards your tithing. Your current plan is to continue to tithe $885 on months without overtime, which is well above the 10% that most churches recommend. If you want to maintain your practice of giving more, how about reducing the cash portion to 10% and volunteering either with your church or another service group? You mentioned that your overtime is going away, so you're about to have more time on your hands. Ideally, you'd be able to involve your older kids so that they learn the habit of service and spend some quality time with you.

Alternately, you could start a side hustle in your (I hate to call it "free time" since you have 4 kids) and give the proceeds to the church on top of the 10% from your salary.

My points are that there are different ways to give, and that giving 20% of your base pay will make FI a very long road.

anxiousclothing

  • 5 O'Clock Shadow
  • *
  • Posts: 9
Re: Case Study - New member looking for help/advice
« Reply #11 on: October 02, 2017, 09:36:05 PM »
Thank you very much for all the appreciative feedback so far.  Sorry for the delay in replying. I have been at work for the past week and free time was scarce as well as sleep. I don't know how to insert and answer previous statements by previous poster so here is a reply all.

1. Dental is currently paid by work. There is discussion that there will be costs associated to dental in 2018 so we added dental to the budget in order to prepare for next year.
2. Advocare is no longer funded.
3. Researching cell phone plans and options
4. Tithing - SimpleCycle is correct on nonnegotiable. The budget provided in OP was for September. I pay tithing one month behind based on ever-changing monthly income based on overtime. The number represented in tithing line was from August income and always represents 10%.
5. 3 cars- I struggle with this one. Emotional feelings aside for my love for cars. I pay $20/month for insurance and $6/month for registration (spread over 12 months) for 3rd car. It is a 2 seater pick up truck that I use it as a daily driver when I'm by myself which gets more than double the gas mileage of my other car that pays for itself. I use my other car when I drive kids/family. Basically we have two vehicles that can be used to drive around with 4 kids since we go in different directions during the week with them. Im open to further thoughts and criticism on this.
6. We only have one Roth IRA. I just learned that we could have two reading the forums here. She was working part time as a teacher and received a pension through PERA. Is it a good idea to roll that over to an IRA? It isn't being funded anymore and only has $1k. Does the IRA have to be tIRA? If so, how do we fund it if she doesn't work? I would like more information on this if someone doesn't mind.
7. Groceries- thank you for the website recommendation on recipes. The grocery budget was trimmed initially earlier this year, however, it wasn't/isnt as strict as it should be. We weren't willing to completely culture shock our kids with all the budget changes we made. It is now time to tighten up that category.
7a. Station meals- I bring in my lunch each day. I am trying to work with my crew to be more conscious and aware of spending habits. We cook and eat two breakfasts and two dinners together as a crew. This is one of my more difficult categories as there is many intangible benefits to cooking/eating together as a crew.
7b. Food storage- Currently we have six months of E-fund. We would like to extend that to 9 months based on our comfort level. Having a 1-3 months food storage extends our Efund by months.......and we are also amateur preppers.
8. Most date nights and fun activities run $20 month. It was raised for September due to anniversary date. We unfortunately don't have family close by for free babysitting.
9. Emergency Preparedness has been to purchase a generator if electricity fails, propane, cooking stove, etc. (little bit at a time)
10. Clothes- needs to be funded. Grandmas like to buy the kids clothes each school year. We don't really complain as the kids enjoy it. I don't need anything really. Wife hates clothes shopping.

Should money be used to max out Roth IRA or 457? 457 is no match. I am expecting a 25% raise next year and want to start on the right track.

Our goal is to live on budget for no overtime and invest every penny that is additional.....so again. Thank you to everyone that has provided feedback and I hope for additional feedback.

MDM

  • Walrus Stache
  • *******
  • Posts: 6961
Re: Case Study - New member looking for help/advice
« Reply #12 on: October 02, 2017, 10:07:31 PM »
Where should my leftover money go? Max out Roth? 457? Other?
Consider this Investment Order.  How does that strike you?

Vegasgirl

  • 5 O'Clock Shadow
  • *
  • Posts: 66
  • Location: Washington DC Metro
  • Never have a battle of wits with an unarmed person
Re: Case Study - New member looking for help/advice
« Reply #13 on: October 03, 2017, 07:53:11 AM »
Double check the rules on your 457 account - not sure of you and SO ages but if you can, contribute max to 457 account.  Unlike the Roth or traditional IRA or 401k the funds in the 457 account are avail with no minimum age penalty once service is separated. (I wished I had known this sooner) This can be the money used to bridge the gap between early retirement and access to IRA/401k/etc... that normally can't be accessed earlier than age 59 1/2 without penalty.  If you can also contribute to the IRA or 401k that would be your money after age 60.  This is my opinion - others may disagree.