MFJ (36 & 37) with 1 dependent (age 10)
Western NC area
Annual Gross Income:
Me: 51,800
Wife: 56,700
NET monthly income is 6200.
Monthly budget is 3200 (pretty streamlined, can go into further detail but feel that we have a good handle on expenses).
The question is where to direct the 3K monthly surplus…
Assets:
Home – Market Value 215,000…owe 171,000 @ 4.25%
2015 Rav4 – Clean Retail 19,000…owe 11,500 @ 2.9%
2015 Corolla – Clean Retail 15,000…owe 8,500 @ 2.9%
My tIRA: 26,255
My 401K: 8,164
Wife tIRA: 0
Wife 401k: 19,000
I contribute 6% and employer matches 3%
My wife currently contributes: 1% to 401k and 6% mandatory state retirement
Her employer contributes 8% to 401k and 7.5% to state retirement
Current plan is to open Wife’s tIRA and each contribute 458.33/month
Bump up Her 401k % to 27% (from 1%) and increase mine to 32% (from 6%)... I’ve tried to look at net pay calculators and I think those percentages should work to exhaust the surplus.
Question #1 is should I stick with the plan, or should I spread some risk and pay down mortgage more and/or cars.
Question #2 is about the actual investments.
My tIRA: FLGEX (Fidelity Large Cap Growth expense ratio .39) but I want to move it to FSTMX (expense ratio .09)
My 401k: NOSIX (Northern Trust S&P 500 Index) closest I could find to total market index fund and exp ratio is .02.
Wife’s tIRA: going to put her in FSTMX
Wife’s 401K: this is where it gets a little complicated:
4% Fixed Income Fund
5% Fixed income Index Fund
9% Large Cap Core Fund
9% Large Cap Index Fund
20% Small/Mid Cap Fund
24% Global Equity Fund
11% International Fund
9% Inflation Responsive Fund
5% Stable Value Fund
I think this is supposed to reflect a moderately aggressive investor. The Large Cap Index Fund has a .04 expense ratio and mirrors S&P 500. Should she change future contributions to 100% this fund? Should she move all existing funds into this fund too? I’m not sure how that works exactly.