My first post to the forums, but I'm a long-time lurker. I found MMM in late 2017 when my wife was pregnant with our first child. Since then, I've gone from only saving ~$7-10k per year in 401k + company match to a new higher paying position that, along with spending cuts, has allowed me to:
- Max 401k @ $19k/year + 6.5% company match will kick in after 1 year of service later this year
- Max HSA @ $7k/year - don't intend to use it for medical expenses until retirement (yes I'll start saving big receipts along the way)
- Pay extra $222/mo towards house payment (I understand cost/benefit of paying house off early, but I want house note gone before I turn ~41
- Pre-fund Kid #1 with $3k in his 529 as starter money and fund additional $500/mo to 529 (I understand differing views on this, but I want to plan to fund 100% of college costs)
- Max Backdoor ROTH IRA for both myself and spouse, yearly
- Both cars fully paid off. Putting money away monthly to pay for next car or any other large, unexpected expenses in cash - will start investing this money in taxable account next year
- With reduced spending, no longer plan to blow bonuses and stock grants on just "extra" spending - plan to put towards savings/house/long-term financial goals
- Finished transition from wife working high-paying career job to a lower-paying nonprofit job that allows her to balance work and caring for our kids without daycare (for now)
I've definitely got some work to do in order to really get on Mint, track spending, cut spending further and also really track my savings rate and so on - but for now my largest concern is my lack of a will, estate planning, and life insurance.....especially now that my wife is pregnant with Kid #2.
I'm working on losing a bit of weight in order to make a 30 year term life policy much cheaper. My company provides 2 year annual salary as base life insurance policy, but I'd like to take out a 30 year term life @ ~10x my salary to make sure wife and kids would be fully taken care of with college costs, paid off house, and essentially pre-fund my wife's full retirement. Pretty much planning on dropping some weight and before end of the year checking with USAA (my auto/home insurance provider) on life insurance policy of this magnitude. So the life insurance part is pretty well understood/planned on, unless anyone has tips on that.
Again, with the background out of the way, my primary pain point/confusion right now is estate planning. If I die, it's simple - everything goes to wife and I need to leave her detailed instructions on accounts and what to do in order to best manage the taxes and continue to backdoor Roth, etc. She doesn't like talking about this stuff, so I'll pretty much just have to have everything written down/recorded in a detailed way for her in the safe, etc.
However, if we both pass - I've been struggling to find a non-charlatan resource for estate planning with two kids. If I set contingency beneficiary designations to Kid #1, those would go to him/her and not be evenly split between the kids. Seems like I would need a revokable trust or something of that nature in order to properly carry out my wishes of everything being 50/50 between the kids. I know I also need to get a Will in order in order to designate desired guardianship (my brother), etc. Any recommendations on resources to learn about best options and cost/benefit/details for this type of estate planning? I figured it would be more widely discussed on personal finance forums - but I just haven't found a lot of good info. I'd really like to be much better informed on my options before sitting in front of a lawyer and wasting $$.
For right now, I feel like my requirements are pretty simple, although I'm struggling to find best way to set it up....However, in 10-15 years if I'm still enjoying working at current pace and estate is larger, then I might have much more detailed requirements about how to split things up, etc.
In terms of assets, for now it's around $220k liquid/retirement, 2 paid off cars, house title jointly in wife's name with $100k equity. Goal is to be $1M liquid in less than 10 years with paid off house and $3M liquid in 20 years. Figuring I'll want to redo estate plan in ~10-15 years depending on how things go to help my niece with college, etc.