Author Topic: Mid 30s and confused where to put extra money... self employed.  (Read 281 times)

BoostJunky

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Mid 30s and confused where to put extra money... self employed.
« on: October 05, 2021, 02:01:39 PM »
Hey everyone. I'm trying to plan for the future and was never taught anything from my parents on how to handle money. (They always scraped by).

My wife and I make around $160,000 a year combined. We are 34 and 38 respectively and have a 5 year old child. I work in commission sales (sporadic income) and my wife has a state level government job. We both max out our Roth IRA (have been for 5 years or so now) and she has a pension from work after 30 years of service (has 8 years in now) and will be able to retire around 62 with 70% of her pay. (Should be around $80,000 or so we're guessing).

Our mortgage is reasonable but property taxes are going up every year and are expensive here in the Northeast. Mortgage is around $2100 a month with taxes. House worth $475,000 or so, owe $290,000.

We have two cars, mine is paid off (worth around $40,000) and hers has a loan of around $27,000 left (worth $50,000).

As I am self employed with sales and have VERY varied income monthly (some months it can be $15,000 - $20,000 some months NO money). I am always scared to not have a large savings account in case of emergencies. I have around $50,000 sitting in savings right now. I'm trying to figure out the best use of that... self employment 401K after roth is maxed? Bonds? Seems silly to keep this kind of savings but if I were to go on a cold streak with work my wife can't support our bills alone on her salary.

We don't have a FIRE date, but plan to work until at least 60 (god willing). Anything I'm missing here? I don't want to miss out on compounding interest at our ages if I can.

MDM

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Re: Mid 30s and confused where to put extra money... self employed.
« Reply #1 on: October 05, 2021, 02:28:11 PM »
Investment Order and Getting started - Bogleheads are two articles that may be helpful.

Questions after reading those?

charis

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Re: Mid 30s and confused where to put extra money... self employed.
« Reply #2 on: October 05, 2021, 02:36:10 PM »
What is your AGI? And what's her income vs  your spending? As a state employee, your wife should have access to deferred comp account, 457.  Do you have access to an HSA? I would max those first if you can and keep your emergency fund at a level that covers the no $ months.  Are you maxing two IRAs or just one?

Agree with MDM.
« Last Edit: October 05, 2021, 02:47:28 PM by charis »

dougules

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Re: Mid 30s and confused where to put extra money... self employed.
« Reply #3 on: October 05, 2021, 02:50:48 PM »
What does your spending look like?