Specific Question(s): Until recently, we were paying off my grad school loans and did not have a lot of excess income to think about savings or retirement. Now that we're in a position to contribute more to our retirement and think about FIRE, we are trying to make it through the initial learning curve. Between us, we have several random accounts and we want to figure out how to best allocate everything. Primarily, we want to do something with the $15,200 we have in cash savings now that our emergency/checking account has grown. So far we definitely want to increase my 401k to the maximum amount and maybe start a Roth IRA for the remaining $4800 that I can contribute for 2016.
Life Situation: Married filing jointly, no dependents. Husband is 36 and I am 31. We live in Irvine, CA.
Gross Salary/Wages: Husband= $90,000, Me= $65,000
Individual amounts of each Pre-tax deductions:- My 401k= 5%, with 2% employer match
- My 2016 IRA Contribution= $700
- Husband’s 2016 IRA= $5500
Rental Income, Actual Expenses, and Depreciation:Rental property w/ long term tenant since 2011 at $2000/month= $24,000/year
- Home estimated around $529,000
- $301,000 owed in mortgage= $1579 monthly mortgage payments
- EXPENSES: $100/month pool maintenance expenses, property taxes at $4300/year, $850/year homeowners insurance
- We mostly break even on this property and are pretty hands-off with the tenant.
Adjusted Gross Income: $179,000
Current expenses: - Rent: $2015
- Utilities (sewage/water, electricity, gas): $140
- Internet: $50
- Car payment: $400 (until August)
- Gas for the car: $200 (lately we have to make many trips to my parents home)
- Groceries: $500 (we also started to contribute to family groceries for my parents so this number has gone up)
- Eating Out: $120
- Misc: $224
- Car Insurance: $100
- Renters Insurance: $28
- Cell Phone: $85
Assets:- Car 1: $1800 (old and in good condition, has a couple of years left on it)
- Car 2: $13,000
- My 401k with Employer’s match of 2%= $6900
- My Vanguard Star Fund Traditional IRA: $7000
- Husband’s Vanguard Traditional IRA: $5500 (just deposited it, have not allocated it anywhere yet)
- Husband’s Bank of America Traditional IRA: $3000
- Hartford Mutual Fund: $4500 (set up by my mom in the 90s, need to move this somewhere)
- Cash Savings (we want to figure out what to do with this): $15,200
- Emergency: $17,000
- The rental house mentioned above
- Husband also has a share in a family house in Canada (he is a Canadian citizen), but he does not contribute to repairs or mortgage at this time, so we are not looking into it as an asset at this time.
Liabilities: None, except for the mortgage for the rental home that is covered by the rental income.
