Tax Rate: 25% Federal (just barely); 9% State
Combined gross income: $70,000
Double check your tax brackets. Unless you have a lot of other income then you might even be able to get close to the zero percent federal tax bracket with a spouse, standard deductions, multiple personal exemptions, a couple $1,000 child tax credits, deductable retirment contributions, etc. http://turbotax.intuit.com/tax-tools/ca ... taxcaster/===== Advice that I'd like =====
1. I have too much sitting in cash, but I don't know what to do with it. At only 3.25%, I don't think it makes sense to pay off my mortgage any more quickly.
An endless argument can be made about this but the question I ask is "If you had a paid off house would you take out a mortage just to invest the money?" Most people would not, some would.
An alternative would be to see if the lender would "recast your mortage" (google this) if you pay off 50% of the balance. (or whatever percentage makes sense to you) If you did this then your mortage payment would be cut by the same percentage and you could the save the difference.
With only 12 years left on the mortage paying it off very earely, and then saving your mortage payment, would not be huge mistake since there is a limited about of time that you could have the money invested and hopefully earn more that 3.25% Should I increase my contributions to the TIAA-CREF account?
Yes up to the deductable limit, if you are really in the 34% marginal tax bracket so that would be hard to pass up.Is it possible to open a Roth IRA for my wife (who is not currently working)?
It depends on the income limits but if not you may be able to do a back door Roth (Google this) If possible a deductable IRA would likely be better.
One thing you can do if you have last years tax software is to make up dummy tax returns to see what is and is not possible and what the atertax affect would be. Should I open a taxable account?
With that much cash yes. http://www.bogleheads.org/wiki/Principl ... _Placement5. If I stay in my current position (highly likely), my children will get free tuition at any of several private undergraduate universities. With this in mind, should I continue to contribute so much to 529 plans? Are there other tax-advantaged accounts I can use to save money for my kids?
Other than saving to help them out with college expenses you are not in a position to really save for your kids unless one of them is disabled or something like that.
By far the best thing you can do is to build up your own rock solid financial situation so they they never have to help you financially. If you are rock solid financially then it is likely that they will inherit something some day so you do not need to feel guilty about not giving them more money now.