Hi All,
So here is my situation. I am currently 30 and my wife is 31. We are both Active Duty Military and our goal is to be retired at 40. We have no debt other than our house ($208K) and we have our emergency fund in place ($15K).
We each have a TSP (Life cycle 2050 fund) and Vanguard Roth IRAs (Target Retirement 2050 fund) accounts and we contribute about $450 into each account every month (4 accounts with a total monthly investment of $1800). We currently have a total of $72K between all of our retirement accounts. If we continue investing at this rate and the market continues with historical averages we will have about $2M when we hit 59.5. Our plan is to continue to contribute to these accounts until we retire from the military and then leave them alone until we are 59.5. We do not want to touch this money before then unless we absolutely have to.
A little info on our current finances. We owe no debt other than our house. Our annual take home pay is about $108K and our expenditures are $45K for what I consider "must pays" (mortgage, utilities, groceries,etc.) With another $25K spent on what we consider the "would be nice" stuff (entertainment, travel, money for our personal hobbies, bars/booze, etc.). I will admit, we spend a lot on travel as that is our passion...especially long motorcycle rides with friends. We are pretty frugal with most of our large purchases. We buy used cars and Craigslist is our website of choice when buying furniture and for large purchases.
We would like to retire from the military and take up part time civilian jobs on base in Europe so that we can take advantage of the travel opportunities. We also really enjoy the slower pace of Europe. I want to work part time as a teacher and my wife wants to work part time as a medical technician (the same job she does right now). Based on the salaries for these jobs we think we can earn about $30K a year net working them part time. Our military retirement will be about $47K a year (net) so I am pretty sure we will be able to cover our costs in retierment.
Currently, at the end of each month we have about $1500 left over (after we invest in TSP/Roth). I would like to start investing this money in an account that we can grow for the next 10 years so that we can have a little bit of a cushion from age 40-59.5. At 59.5 we would start drawing the money from our retirement accounts. I would like to start investing it in a taxable account that way we would have access to the money at 40 when we would need it. However, I am not sure what assets I should put that money into.
So my main question is two parts: Is a taxable investment account the best way to go? And what assets should I put in that account? I am looking to be pretty aggressive with this account and would like to earn at least 8% on the money in the next 10 years. Any and all help would be much appreciated and sorry if I got a little long winded!