Author Topic: Advice On Investment Accounts  (Read 1674 times)


  • 5 O'Clock Shadow
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Advice On Investment Accounts
« on: January 17, 2021, 04:31:52 PM »
Would love to get some thoughts on where I should be putting the money I've got to save. With a somewhat early retirement in mind, what might my most efficient breakdown of investment (taxable/tax advantaged) accounts look like?

My numbers:
Retirement accounts: ~ 16k
Cash: ~ 14K
Net income ~72k
Annual spending ~ 32k
Savings potential ~ 40k

These numbers do not include my wifes 8% 401k contribution with 8% employer match, nor my own Gov Pension and HSA contrib to max that match. Being a government employee I have access to a gov. 457b (roth or traditional).

So, between my wife's 401k, my 457, and a combination of IRAs what would you max first (what in Roth vs trad)? With early retirement in mind what % would you put in to a taxable account to cover the time between access to the retirement accounts? I'm 28 years old, but hoping for hypothetical best case situations. As of the start of this year we will have our 20k student debt paid off before 2022.



  • Handlebar Stache
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Re: Advice On Investment Accounts
« Reply #1 on: January 17, 2021, 06:36:58 PM »
Potentially, you wouldn't need anything in taxable, because you could withdraw your contributions to your ROTHs without penalty (if you have ROTHs), and I believe the 457 allows for early withdrawals.

Make sure you familiarize yourself with the Investment Order:


  • Bristles
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Re: Advice On Investment Accounts
« Reply #2 on: January 17, 2021, 07:08:21 PM »
I agree the investment order post is a great place to start and if you follow that you'll be great. Don't over complicate things.

if you're savings 55% of your income you'll be fine in 15 years regardless of what retirement account you maximize or whether you choose roth vs. traditional vs. taxable. As long as you are taking full advantage of any matching contributions, you're fine choosing any of the remaining options and everything will be fine, just keep that 55% savings rate going, priority #1...


  • Magnum Stache
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Re: Advice On Investment Accounts
« Reply #3 on: January 17, 2021, 09:07:10 PM »
I agree with the Investment Order suggestion. With saving $40k and access to a 401(k), 457(b), HSA, and two IRAs you'll be able to put all your savings into tax advantaged accounts, which I would. Given that, you should familiarize yourself with how to access retirement accounts early: In particular, the best way to go IMO would be a Roth conversion ladder which will mean you'll need 5 years of spending available in Roth contributions and your 457(b).

This should help with the Roth vs traditional decision: One quirk of the governmental 457(b) is that as mentioned it doesn't have early withdrawal penalties unlike other retirement accounts making it a great early retirement option. However, Earnings on Roth contributions are subject to tax if withdrawn before age 59.5, so you'd be better off contributing to Roth in other accounts so the full 457(b) balance (contributions and earnings) is available. You'll still pay tax on the withdrawals, but since you get a tax deduction when contributing that's fine.


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