I've read the Boglehead's Guide to Investing, and am almost 3 months into putting my financial future in order. I always thought "saving" cash was the number one goal of a good financial future, but now I'm learning. Please check over my plan for my first year, and tell me if I'm missing anything.
Up until now, both my wife and I just added the minimum to our 401ks to get the company matches and let them sit in target retirement funds. We saved the rest in cash. After reading the book, I did my best to do my own asset allocation across our 401ks with minimal fees, bumped up our percentages to make sure we max out our 401ks, and I opened a brokerage account with Vanguard.
Financial Summary
- 32 years old
- Combined Gross Salary - 200k
- Combined 401ks - 141k
- Brokerage Account - 30k
- Cash on Hand - 130k
- Projected Saving Per Year - 80k
- No Debt Except Mortgage - 200k left at 3.5% - 150k Equity
Wife's 401k:
- EQUITY INDEX TRUST CLASS C - 30.3k - ER: .10%
- VANGUARD EXT MRKTS IDX SIGNAL - 7.7k - ER: .10%
- VANGUARD TOT INTL STK INDX SIG - 15.2k - ER: .14%
- US BOND ENHANCED INDEX TRUST B - 24.8k - ER: .15%
- TOTAL - 78k
- SPTN 500 INDEX ADV - 24.6k - ER: .05%
- SPTN EXT MKT IDX ADV - 6k - ER: .07%
- VANG TOT INTL STK AD - 12.5k - ER: .14%
- SPTN US BOND IDX ADV - 20k - ER: .10%
- TOTAL - 63.1k
- VTSAX - 20.2k - ER: .05%
- VTIAX - 9.6k - ER: .14%
- TOTAL - 30k
When I first did the asset allocation, I set it to 68% Stocks / 32% bonds following the "age in bonds" idea. After doing more research, I think I'm more comfortable at 75% stocks / 25% bonds. Since I first moved everything around, my current allocation is at 74% stocks / 26% bonds just because of the market and our 401k contributions.
I wanted to contribute to 2 roth IRAs this year, but I'm not sure if we'll be eligible because of bonuses for my wife and I later in the year that might make us ineligible.
Questions
- If we can't contribute to a roth IRA this year, should we be looking at opening traditional IRAs and making non-deductible payments? (I do not understand how to judge this against just putting money into our brokerage account)
- I'm planning on using our 401ks to house all of our bonds, and adjust asset allocation of stocks in the 401k and in the brokerage account. Does this make sense?
- I've never done taxes that included any taxable investments. I'll have put 130k in our brokerage account this year, unless you guys suggest otherwise. Anything I need to know tax-wise?
- Am I missing anything?
Thanks!