Author Topic: Late 20's median income mustachian starting out- critique my budget!  (Read 9952 times)

robartsd

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Re: Late 20's median income mustachian starting out- critique my budget!
« Reply #50 on: August 14, 2015, 04:27:05 PM »
One more point I forgot earlier - why are you using a Roth? A traditional IRA is much more useful if your plan is to keep expenses low for FIRE. A Roth only makes sense if your tax rate in retirement is higher than your tax rate when you contribute - true for 1) people with no current income tax liabilty, or 2) young people who don't make much now but expect to earn high incomes in the future to fund fancypants retirements. Roth does have one advantage in that contributions are availible any time (once the account has been open for 5 years). You might want to keep building up the Roth until the contributions are enough to qualify as your emergency fund - then switch to funding tax deffered accounts. Once your Roth contributions are availible for penalty free withdraw, draw down your taxable emergency fund to help you contribute more to tax advantaged funds.