Hi All,
I posted on here about a year ago when I was new to Mustiachianism. I wanted to post a few details about what we've been up to and how it's going. Thanks in advance for your input, friends!
For backstory: my wife and I have been together 10 years and married for one. We're 29 years old with no kids. We both have MA's and jobs we like. We live in NYC and have the great fortune of not having to pay rent, by virtue of living in a nice 2-bedroom apartment that is owner by her family. We're fortunate, we're happy and we're
Current Financial Vitals:
Combined gross annual salary: Approx. $150k
Emergency Fund: $14k in a local Federal Credit Union that we basically pay no attention to growing at 1.1% APY.
Savings Rate: 30% (approx 12% to max my 401k and the rest to a conservative 70/30 Vanguard "house" fund that we may use to purchase a house, but really is just a glorified Savings account where we put the bulk of our Savings.)
Credit Union 'Emergency Fund'in FCU : $14k
Vanguard "savings" conservative 70/30 account: $77k
Combined 401ks: $61k
Total current savings: approx: $152,000
Perks: No debt for either of us; we don't pay rent; solid 401k matching from my job (they contribute 10% base salary as long as I contribute 5%). My wife's company matches up to 4% and we use that too, though she's not maxing her 401k at the moment.
Expenses: Mostly all "luxuries", though our only big monthly bill outside of utilities is cell phones. No cable. We eat and drink out a fair bit living in NYC, but we've agreed that these and travel are things we value spending our money on. We also just finished a big reno/re-design to our apartment, so that some expenses have gone to that in the last year as well.
Here are a few things I wanted to check on and would appreciate advice about:
1) Our average joint monthly income, after 401k contributions is about $8000. Currently, we put $2000 of it toward the Vanguard savings, which is obviously 25%. I would like to up that to at least $3,000 in addition to the maxing of my 401k. (See question 4 below)
2) Our Financial Advisor suggested the Vanguard fund for Savings because we'll probably be using that money toward a house/apt purchase within the next five years. That said, this is kind of a nebulous goal since we're currently living rent-free in a 2-bedroom apartment that we love and recently re-designed. Does this mean the "House" fund should actually be less conservative and have more equity?
3) Kids are certainly on the horizon, but not for another year at least. How should this timetable influence our saving?
4) My wife's a bit of a shopper and the way we've got that accounted for that is she has a personal checking account of money she can spend on whatever she wants. However, our paychecks go into our joint account and her personal checking account (mine as well) gets a disbursement of $500 a month. In other words, they vast majority of our money stays in joint account, and we control through timed transfers just how much money is in our "fun money" personal checking accounts.
That said, my wife just got a 20% raise (included in all the above figures) and the question now is whether we increase the "fun money" disbursement to her account or increase our Savings rate. Even though we pool all our money, because it's her raise and she worked so hard for it, I feel inclined to at least talk over what to do with it (as we do everything).
5) And finally, given our circumstances, how do you think we're doing overall - as 29-year-old, NYC residents- in terms of our savings and future planning? Obviously we are not hyper frugal and we've applied a kind of adapted version of Mustachianism that suits our lives at the moment. I've been listening to a lot of the "So Money" podcast with Farnoosh Torabi and hearing about people who started saving and using compound interest young. Do you think we're on a good track for our future lives? A great one? Or should we definitely be doing more?
Many thanks to all the Mustachios out there!