Author Topic: Where to go from here?  (Read 3006 times)


  • Guest
Where to go from here?
« on: December 07, 2012, 03:06:58 PM »
Long-time lurker. I've been wanting an objective opinion on this for some time, but convinced myself I was doing fine. In reality, I need some public shaming and face punches, I'm sure.

Weíre both 27

Income after deductions
Me: 3,000/2 week month (including daycare FSA reimbursement)
Him: 2,200/2 week month (this is the lowest possible, itís typically a bit more dependent on overtime)
**We use our extra 4 checks to fund our Roth IRA every year

3,000- student loan itís at 2.25% and I just canít convince myself to pay it off
126,500- mortgage, just no-cost refinanced to 3.875%, which Iím sure isnít awesome, but itís better than where we were

$33,000 in cash in various accounts, I realize this is probably too muchÖ
$50,000 in a bunch of different retirement accounts, about $20,000 in the 403(b)
The house is worth about $155,000
2007 Ford Focus and a 2008 FJ Cruiser

Pretax investments
Me: 5,300/year 401(k), my employer puts in an additional 3,200 regardless if I put anything in (I just became eligible for this, this month)
Him: 4,810/year 403(b) (he also contributes a percentage to a pension)

Monthly Expenses
1,000-credit card bill which includes gas, food, clothes, gifts, trash, internet, water and miscellaneous
125-car insurance
75-student loan
50-529 for daughter
250-extra mortgage payment
300-car savings
Total- $3,800ish

Yearly Expenses
4,500-vacation (max budget)
2,500-home costs (trees, replacing/fixing stuff)
5,000-Other Roth IRA (first one done with 3 extra paycheck months, this is our first year investing the full $10,000, previously we only maxed out one)

Ultimately, this leaves about $5,000 that just adds to the savings account every yearÖ Itís actually $2,000-$4,000 more than that when you take into account my husbandís overtime, but I donít know when to really count that, since it fluctuates so much.

I want to have the option to retire at 42. My husbandís in a hazardous duty retirement system, so heís eligible at that point. He also will receive a pension, which if he never gets another raise in his career will be about $26,000/year.

My husband is probably 60 percent on board. He doesnít spend a lot of money, and Iím generally in charge of the finances. However, the whole owning acres of land thing (which is EXPENSIVE mind you, weíve had more than $1,500 in tree work this year), driving ridiculous cars and having a super fancy phone are important to him. There is a possibility that I will be able to convince him to move to a better school district for our daughter where we wouldnít be able to afford as much land and would be closer to our jobs, but generally speaking this is not negotiable for the sake of saving money.

I would say about $350 of our credit card bill every month is for gas, but like I said, as much as I would LOVE to move closer to our jobs, itís unlikely to happen. Going to one car is also impossible because my husband works rotating 12 hour shifts at the moment. 

I am scared of normal investment accounts.  I realize they are the same thing as what Iím doing with the general retirement funds, but psychologically itís just scary to me.  I'm a crazy person.

Now, let me say, we do lead an exceptionally decadent life. I get that. $4,500 on vacation a year?!? 3 separate week long vacations?!! Ridiculous! --excuses deleted due to shame-- I think we should still be able to accomplish our goals with this insanity, but maybe I need to get rid of the bed pan. I donít know. 

Where to Go
So, what would you do if you were in my shoes?  Up the 403(b) contributions? Cancel a vacation a year? Switch to an in-home daycare? Pay more on the house? Pay off that student loan? Open a regular taxable investment account? Learn how to cut down trees? Please donít make me wield a chainsaw. Itís unlikely to end well.


  • Pencil Stache
  • ****
  • Posts: 518
  • Age: 32
  • Location: North Carolina
Re: Where to go from here?
« Reply #1 on: December 07, 2012, 03:31:37 PM »
FJ Cruiser = WTF. Also, why are you putting $300/mo into a car savings? Your cars are fairly new.

Vacations seem expensive. Are you sure you can't do similar vacations for cheaper?

Phones expenses are high.

Unless you are debt-averse, that extra mortgage payment might be better utilized in the market, especially after your refi.


  • Bristles
  • ***
  • Posts: 267
Re: Where to go from here?
« Reply #2 on: December 07, 2012, 03:39:39 PM »
I'm confused.

What do you mean by other IRA? You take home 5200 every 2 weeks. Your extra 4 paychecks (from 3-paycheck months) total 10400. That's 2 IRA, no?
And your listed monthly expenses is less than half your monthly take home, yet you don't reflect it in your yearly savings.
From what you've listed, you should be able to easily afford to max out your 401/403s.

From your listed expenses:

What is covered under the very big range of '50-529 for daughter'?
You lump a lot into that 1000 for cc. Perhaps it will help to track it better, so you can have a better idea what categories seem reasonable, and which have room to cut.


  • Walrus Stache
  • *******
  • Posts: 9520
  • Location: Seattle
Re: Where to go from here?
« Reply #3 on: December 07, 2012, 06:20:00 PM »
Since you and your DH seem to have very different attitudes/values, I'd approach this in stages:

1)  Up your current savings levels. Start with retirement.  Get as close to maxing out your retirement savings as you can (may need to ease into it over some time, given DH's attitude/spending habits).  You will save on taxes and be in better shape for the future.  If you end up retiring early, you can always tap into those funds via the 72t rule.  I would also increase what you are putting in the 529 for your daughter -- $50/month is not much. 

2)  Track expenses -- learn where your money is going in a very precise way.  This information combined with Mustachian analysis of alternatives can be used as ammunition in changing your DH's attitudes/habits.  So don't try to separate him from his expensive toys immediately, but show how much those are really costing (and put it in terms that will shock him -- like "do you realize we are spending more on gas every month than we spend on food" or something like that.  Might need to bring the food bill down first...) and then identify alternatives that cost less.

3)  Model positive change yourself, and show ways you can have the same quality of life for much lower cost.  So maybe in the first year you keep taking those three vacations, but for one of them you do a house swap or some kind of "staycation" so that you don't spend so much money.  Later you have a talk with DH about cutting back to two vacation trips a year so that what you would have spent on the third can be saved for some really amazing trip 3-5 years down the road.  WHile this won't necessarily result total savings, it will help get him going on the road toward better cost-benefit analysis of immediate spending and help cultivate a habit of deferred gratification in your family overall.  Having and saving for long-term goals is a habit that needs  to be cultivated and you can be doing it in steps like this rather than jumping toward an ERE-type goal all at once.

Good luck  and keep us updated about what you end up doing -- it is fun to watch people transform their lives in a positive direction, and you'll get lots of support here as you try to work through all the issues you are dealing with.



  • Administrator
  • Senior Mustachian
  • *****
  • Posts: 27760
  • Age: -999
  • Location: Traveling the World
Re: Where to go from here?
« Reply #4 on: December 07, 2012, 06:25:23 PM »
OP seems to have deleted their account same day as posting this.

How odd.
We are two former teachers who accumulated a bunch of real estate, retired at 29, and now travel the world full time with two kids.
If you want to know more about me, or how we did that, or see lots of pictures, this Business Insider profile tells our story pretty well.
We (rarely) blog at Check out our Now page to see what we're up to currently.


  • Bristles
  • ***
  • Posts: 326
Re: Where to go from here?
« Reply #5 on: December 08, 2012, 12:35:45 PM »
What is covered under the very big range of '50-529 for daughter'?

I think that indicates putting $50 into a 529 account for their daughter.  Which is more "savings" for the future expense of college.