### Where to start - advising my DS #1

Posted:

**Mon Sep 14, 2020 8:36 pm**I'm new to learning anything about investing but realize it's way past time. I've read most of The Simple Path to Wealth and browsed some on here. But I still need things spelled out pretty simply. I've also got 2 adult children who are working (and living at home) that I need to start teaching this topic to as well. Since each group (DH and I, DS #1 and DS #2) each have distinct situations I'm going to ask about each in different posts as I gather the information.

DS #1 (22 years old)

DS has been working for 4 years while in college. He contributes 6% to his 401k and has since the day he began. However, they sold off his branch to another company so he has money in 2 accounts. Account from old company he has about $1800 as his vested portion. There is more than that in the account but since he no longer works for that company I'm assuming there is no way for him to earn the extra portion. I'm assuming we should roll this into something else but not sure what (can he roll it into his current's company's or does he have to set up a new one). Current company he has just under $10k but it says he is 100% vested. I don't know what percentage his company matches but I'm guessing maybe 2-3% since the statement shows their contributions to be quite a bit less than his. The money seems to be going into a traditional 401k but I see on the investment screen that there appears to be an option for a Roth 401k as well.

Further points of note. He has 2 semesters of part time college left. He has more funds left in his 529 than he needs to pay for this, however, if he gets high enough grades, the company will reimburse for these 2 semesters. My understanding is that we can switch the name on the 529 to a younger sibling (we would then have that sibling reimburse him the cash value), or he can leave it there for possible future kids or withdraw it at a penalty? (not as sure about this option). Only relevant to the investment discussion in case we should be taping it as a source of cash for him to invest elsewhere.

Back to investing, since his college expenses are met (he lives at home so no room/board even if everything wasn't online). He can easily live on less than he's making. Last year he made about 31K, I expect this year will be a little bit higher as he is able to work more hours with only part time schooling.

Long term goals. He will remain at his current company until at least May of 2023 (needs to remain for 2 years after last education dispersal) which will be no hardship as he enjoys his job and the company loves him. There is a high probability that he will get married in 2022 and would need to have some money saved up for those expenses as well as moving out. But in the meantime, I figure we should bump up his savings.

I understand there are probably missing pieces of information but since neither he nor I really know much about this, I don't even know what questions to tell him to be asking so feel free to fill us in that too.

What changes would you suggest I advise him to make?

DS #1 (22 years old)

DS has been working for 4 years while in college. He contributes 6% to his 401k and has since the day he began. However, they sold off his branch to another company so he has money in 2 accounts. Account from old company he has about $1800 as his vested portion. There is more than that in the account but since he no longer works for that company I'm assuming there is no way for him to earn the extra portion. I'm assuming we should roll this into something else but not sure what (can he roll it into his current's company's or does he have to set up a new one). Current company he has just under $10k but it says he is 100% vested. I don't know what percentage his company matches but I'm guessing maybe 2-3% since the statement shows their contributions to be quite a bit less than his. The money seems to be going into a traditional 401k but I see on the investment screen that there appears to be an option for a Roth 401k as well.

Further points of note. He has 2 semesters of part time college left. He has more funds left in his 529 than he needs to pay for this, however, if he gets high enough grades, the company will reimburse for these 2 semesters. My understanding is that we can switch the name on the 529 to a younger sibling (we would then have that sibling reimburse him the cash value), or he can leave it there for possible future kids or withdraw it at a penalty? (not as sure about this option). Only relevant to the investment discussion in case we should be taping it as a source of cash for him to invest elsewhere.

Back to investing, since his college expenses are met (he lives at home so no room/board even if everything wasn't online). He can easily live on less than he's making. Last year he made about 31K, I expect this year will be a little bit higher as he is able to work more hours with only part time schooling.

Long term goals. He will remain at his current company until at least May of 2023 (needs to remain for 2 years after last education dispersal) which will be no hardship as he enjoys his job and the company loves him. There is a high probability that he will get married in 2022 and would need to have some money saved up for those expenses as well as moving out. But in the meantime, I figure we should bump up his savings.

I understand there are probably missing pieces of information but since neither he nor I really know much about this, I don't even know what questions to tell him to be asking so feel free to fill us in that too.

What changes would you suggest I advise him to make?