Emergency funds: Three to six months of expenses - Savings account earning ~1% interest
Debt: None, House paid off (no mortgage)
Tax Filing Status: Married Filing Jointly
Tax Rate: 25% Federal, 5% State
State of Residence: Ohio
Age: 30, wife 30, 2 children under age 3
Annual Living Expenses = ~30K
I am an engineer. Wife recently stopped working outside the home in order to take care of children. She may or may not return to full or part time work in the near or distant future.
I was fortunate enough to discover this forum at a young age, so I developed good investment/spending/etc habits early on. I embrace the fact that time is on my side and usually do not check my investments more than once a year, aside from insuring that transactions have processed correctly.
Current retirement assets
Total Stock Market (VTSAX) - $11K
Total International (VTIAX) - $11K
Target Date Fund (55% US Equities, 30% International, 15% Real Estate) (0.12%) - $225K
His Roth IRA at Vanguard:
Vanguard 500 (VFIAX) - $10K
Total Stock Market (VTSAX) - $40K
Target Date 2050 (VFIFX) - $10K
Target Date 2055 (VFFVX) - $15K
Target Date 2060 (VTTSX) - $20K
Her Roth IRA at Vanguard:
Windsor II (VWNAX) - $90K
Her 403b at Vanguard:
Vanguard 500 (VFINX) - $150K
Her 401a at Fidelity:
Fidelity Freedom K 2055 Fund (FDENX) (0.64%) - $60K
Her 457 (deferred compensation):
Target Date Fund (50% US Equities, 30% International, 20% Real Estate/Other) (0.21%) - $80K
HSA with HSA Bank (paying for current expenses out of pocket and saving receipts) - $10K
Also currently accruing a pension from my employer
Total of All Accounts Together = $730K
529 Accounts Total = $10K
New annual Contributions
$18K (max out) his 401k (plus 3% employer match) (plus additional ~$7K for Mega Backdoor Roth contributions)
$5.5K (max out) his Roth IRA
$5.5K (max out) her Roth IRA
1. My goal is to retire by age 50. Based on the information above and my current contribution levels, do you think this is possible?
2. In my mind, I have "my number" set at $13 million. This is for the following reasons:
- If I count my portfolio value as $12 million (reason mentioned below) I could draw ~1% of my portfolio per year and have ~10K per month to spend in retirement however I liked. This would facilitate my wife/children/family enjoying our early retirement through travel/hobbies/etc without having to worry about overspending.
I could use the remaining $1 million as a sort of "endowment" and use the gains for philanthropic purposes. I would plan to leave this amount invested in equities (such as VTSAX) to assist with growth. In my mind I have thought I would take half the gains from this fund each year and leave them invested to help with exponential growth. The other half I would divide into two sums, one of which could be divided across several charities/causes of my choosing, the other of which could be used for "familial charity" (helping family members with major expenses as we see fit, nieces/nephews college costs, etc).
Overall, this total portfolio would set up my children and grandchildren to receive sizable inherited wealth. I would make my best attempt to educate them on the Boglehead mindset to help ensure the wealth would be managed/used correctly.
I appreciate any and all input! Anything from criticism to praise is welcomed.