Hi, Mustachians. I have come for a little help.
I think we are doing fairly well on our journey as far as the things we've tackled already. We still spend more than most here, but we're spending consciously. My husband and I have both started side hustles to bring in some extra money, and our savings rate for the next year should be 35% or a little higher. He has a third interview for a new job this Friday, and that would both bump up our savings rate to over 50% and reduce his insane 240-mile round-trip daily commute to about 70 miles. I've adopted YNAB and, if I do say so myself, my budget is a thing of beauty. I spend quality time with it every day. :) We've eliminated our auto loan and reduced our insurance costs by trading our 2011 Sienna for an older, smaller vehicle. Our electric bill, while still on the high end of those posted on the "Share Your Badassity" board, is down by about a third. So I think we're on the right track. I've started a savings account to build up the $3,000 it takes to start a Vanguard account, and should be there very soon. It's going quickly. BUT...
I don't know what to do with it.
This is what we have so far.
Thrift Savings Plan - $29,857 (his)
Scottrade IRA - $1,205 (his, a rollover from a job he had in the early '90s)
cash in bank - $23,949
We also have some rental real estate with positive cash flow, VA disability payments for conditions that are very unlikely to change even if they are reevaluated (already receiving), and a military reserve retirement that starts when he is 56. He is 49 and I will soon be 42.
There is a 401(k) available at his job, and the company will match up to a certain point after a year, which is in October. I don't know if it's a year after hire, or a year after signing up for the 401(k), but he didn't sign up for it because we didn't think he'd be there for more than a few months. This job got him home from a contract position on the other side of the country, but the commute is horrendous and he's been working on getting another job all along. We needed to build up an emergency fund anyway, which we have.
The potential new company also has a 401(k) with 3% match. So that's the background on where we are. Here is what I understand:
401(k): A retirement account controlled by an employer. That bothers me for some reason. What if the employer mishandles it or goes out of business? How do we know it's in a good place?
IRA: Anyone can get one of these. We could even start one for me. The money goes in pre-tax, but then gets taxed when it's taken out.
Roth IRA: The money is not pre-tax, but doesn't get taxed when it's taken out. Again, we could both have one, right?
Regular taxable account: Obviously inferior because of taxation, but at least it's simple and I understand it!
If you were 49 and 42, which one would you choose? Or maybe more than one type? If it matters, I will probably start working in about a year, and will work until he retires, whenever that is. It won't be a lot of money, probably part time, but I will need a place to invest that money, too.