I'm looking at the year ahead of us, and can't seem to wrap my brain around what we should be doing. We discovered MMM in October and have quickly become on track and detailed. This makes me anxious to begin a new year living this way, and I'm worried that I'm trying to accomplish more than I have the current skill set to understand and execute effectively. I have general ideas, and some specific goals, but not enough to make them happen. I hoping for some guidance, some learning on my end and maybe even an idea we hadn't considered. My biggest fear is that I am in way over my head...
Income for 2014. We are projecting 75k. This is a goal, one we feel is reasonable and achievable, but of course not guaranteed. My husband is a mechanic, and his income is a reflection of available work, not salary.
One change that is out of our hands is the new medical his employer is providing. It is an HSA with a family deductible of $5,000. Monthly cost is $326.81. The employer does not make any contributions to the $6,450 limit. Open enrollment begins in April for coverage beginning May 1. His employer pays both mine and his medical in full, and his dental in full.
. My husband and I are healthy, with little need beyond yearly exams, same with our son, but he has been to the ER 2x in the last year. My daughter has had a host of medical issues since birth, esp GERD and has seen a specialist every 2-4 months and takes expensive medication. This seems to be improving, and we hope to have her off medicine in the next year. Prior to marrying my husband in Oct.'12, the kids had state provided medical coverage, so I don't know what their yearly costs were.
Our current 401(k) withholding is 10%. We will be increasing this to 15% January 1. They match a %, but I don't know what it is at the moment.
Questions:
1) What should we be contributing to our HSA? Is there a magic number? I don't think we will meet our deductible, but do have the cash reserves if that were the case.
2) Is going from 10% to 15% too little? His salary this year was just under 70, so a goal of 75k for '14 would put away $11,250. I want to be at the max contribution at some point sooner rather than later.
3) Should we be contributing to our Roth at this point?We have a Roth that was started by a family member years ago, but have not contributed anything to it.
4) Our monthly expenses are $3,100. I don't know what his net pay for 2013 was because I didn't pay any attention or track expenses. Is there a way to figure out net pay?
We live in Washington state, so no income tax, we take the standard deduction and have 1 wage earner, 2 young kids, and no debt besides a mortgage and small ish student loan. The student loan has a balance of 19k, and will be getting paid off in the next 2 years. Emergency fund is $20k.
My fear is that while income is rising a bit, we suddenly have new health care expenses, new HSA contributions and hopefully a higher 401(lk) withholding and will run our budget to the max.
I appreciate any input.