Financial Review: Preparing for SAHM

[ucj11]

Hi all,

It’s been about four years since I last posted a financial review, and a lot has changed since then. I appreciate everything I’ve learned from this community and would be grateful for some perspectives as we prepare for our next stage of life.

My wife and I have two kids (3 year old and 1.5 year old) with our 3rd on the way in March 2025. We’ve made a decision as a family for my wife to stop working and stay at home once her maternity leave concludes in the June timeframe.

From a big picture standpoint, I think we’re in pretty good shape financially and will find a way to make this work. With that said, I’d like to ensure we get all our ducks in a row beforehand – we’d be very grateful for your input on our situation.

Age: 35 / 32

Emergency Fund: 3 months

Debt:
$385K mortgage @ 2.625% (26 years left). Planning on this being our "forever" home and do not anticipate paying off early due to the interest rate.
$16K car loan @ 0.9% (under 2 years left). Decided to keep this due to low interest rate.

Tax Filing Status: MFJ

Tax Rate: 24% federal, 6.35% state

Desired Asset Allocation: 100% equities

His Income: $178K base + ~$45K bonus/RSUs. I’m aiming for a promotion over the next 6 months, but not banking on anything.
Her Income: $95K base + ~10k bonus. As mentioned above, my wife will no longer work, but this will be partially offset by child care costs we’re paying today.

Current Portfolio: $1.1M
Other Assets: $330K (home equity) and $79K (529 plans for kids)

Annual Savings:
Max 401k x 2 ($46K + $14K employer match)
Max Backdoor Roth IRA x 2 ($14K)
Max HSA x 2 ($8.3K)

Portfolio Breakdown:
401K ($820K): 100% Dryden S&P 500
HSA ($41K): 100% VFIAX
ROTH IRAs ($215K): 100% VTSAX
TAXABLE ($33K): 100% VTSAX

A few other comments:
- Other than my wife’s 401K, we’re aiming to continue funding the other investing vehicles as usual (planning on staying 100% equities until ~50 years old)
- Our goal is to contribute to the 529 accounts where we can (with lump sum bonuses, etc.)
- To date, we’ve been maxing out the HSA and keeping this fully invested (keeping medical receipts for future reimbursement). I’d like to continue this going forward.
- We both have term life policies ($2M for him, $1M for her) and completed estate planning and wills when our first child was born
- We’re planning trade in our 12 year old compact sedan for a minivan within the next 6 months

A few things top of mind for me:
- Planning to increase our emergency fund (at least 6 months, maybe more?)
- While I have disability coverage through my work policy, I want to further investigate this and consider supplemental coverage
- Tighter scrutiny on monthly budgeting over the coming months and ensuring we’re handled from a cash flow perspective

We’d appreciate any feedback as well as any blind spots we might not be thinking about.

Thank you!

[retired@50]

We’d appreciate any feedback as well as any blind spots we might not be thinking about.

Thank you!

After your wife quits working it appears your Federal tax bracket will drop to 22%. Will the state bracket drop as well?

No international stock index fund? Is that on purpose?

Regards,

[learning30]

Hi all,

It’s been about four years since I last posted a financial review, and a lot has changed since then. I appreciate everything I’ve learned from this community and would be grateful for some perspectives as we prepare for our next stage of life.

My wife and I have two kids (3 year old and 1.5 year old) with our 3rd on the way in March 2025. We’ve made a decision as a family for my wife to stop working and stay at home once her maternity leave concludes in the June timeframe.

From a big picture standpoint, I think we’re in pretty good shape financially and will find a way to make this work. With that said, I’d like to ensure we get all our ducks in a row beforehand – we’d be very grateful for your input on our situation.

Age: 35 / 32

Emergency Fund: 3 months

Debt:
$385K mortgage @ 2.625% (26 years left). Planning on this being our "forever" home and do not anticipate paying off early due to the interest rate.
$16K car loan @ 0.9% (under 2 years left). Decided to keep this due to low interest rate.

Tax Filing Status: MFJ

Tax Rate: 24% federal, 6.35% state

Desired Asset Allocation: 100% equities

His Income: $178K base + ~$45K bonus/RSUs. I’m aiming for a promotion over the next 6 months, but not banking on anything.
Her Income: $95K base + ~10k bonus. As mentioned above, my wife will no longer work, but this will be partially offset by child care costs we’re paying today.

Current Portfolio: $1.1M
Other Assets: $330K (home equity) and $79K (529 plans for kids)

Annual Savings:
Max 401k x 2 ($46K + $14K employer match)
Max Backdoor Roth IRA x 2 ($14K)
Max HSA x 2 ($8.3K)

Portfolio Breakdown:
401K ($820K): 100% Dryden S&P 500
HSA ($41K): 100% VFIAX
ROTH IRAs ($215K): 100% VTSAX
TAXABLE ($33K): 100% VTSAX

A few other comments:
- Other than my wife’s 401K, we’re aiming to continue funding the other investing vehicles as usual (planning on staying 100% equities until ~50 years old)
- Our goal is to contribute to the 529 accounts where we can (with lump sum bonuses, etc.)
- To date, we’ve been maxing out the HSA and keeping this fully invested (keeping medical receipts for future reimbursement). I’d like to continue this going forward.
- We both have term life policies ($2M for him, $1M for her) and completed estate planning and wills when our first child was born
- We’re planning trade in our 12 year old compact sedan for a minivan within the next 6 months

A few things top of mind for me:
- Planning to increase our emergency fund (at least 6 months, maybe more?)
- While I have disability coverage through my work policy, I want to further investigate this and consider supplemental coverage
- Tighter scrutiny on monthly budgeting over the coming months and ensuring we’re handled from a cash flow perspective

We’d appreciate any feedback as well as any blind spots we might not be thinking about.

Thank you!

Do you have a good grasp on what your expenses are? What percent of your gross income will all your fixed expenses be based off just your income?

Will you be able to save enough to add to your EF and reach the 6 month goal you mentioned, plus max your Roth IRA, plus max her Roth IRA every year?

The above aside... You're already at the top of the mountain with where you are today. Great work.

[momvesting]

We did this same thing many years ago when we were in your shoes. One of the things we did, just as sort of a thought exercise, was to separate our money and live off the one income that would be continuing during the pregnancy. It definitely help put our minds at ease. The easiest way to do this is to open a second account and deposit all of your paycheck in one, hers in the other. Use hers to pay the taxes at the higher marginal rate, max her 401k, and pay any expenses that will be going away, like child care. The rest gets placed into short-term savings, like a HYSA. Your paycheck will pay the mortgage, car payment, health insurance, car insurance, and all the regular expenses like food and utilities. Even work in a mock car payment (that goes to savings for now) if you plan to finance a second car. Then by the time the baby comes, you should know what your financial picture will look like with one income. There will be a few small tweaks, like adding diapers and baby supplies, but you will also presumably reduce a few other areas, like her commuting costs.

[jackholloway]

We made this choice ourselves.

DW hated her job, and we had arranged our life to work, with some stretching, on one income. It took a few years for us to get the details right, but we are both happy with our choice. We do honestly believe that contributions are equal, and that dollars are not the only way to measure.

One unintended consequence - she is dreadfully tired of people claiming that homemaking, volunteer work and activism “isn’t work”. Talk that one through at length, and get on the same page. Enough strangers will judge your family, so you need to be well aligned.

[chassis]

Hi all,

It’s been about four years since I last posted a financial review, and a lot has changed since then. I appreciate everything I’ve learned from this community and would be grateful for some perspectives as we prepare for our next stage of life.

My wife and I have two kids (3 year old and 1.5 year old) with our 3rd on the way in March 2025. We’ve made a decision as a family for my wife to stop working and stay at home once her maternity leave concludes in the June timeframe.

From a big picture standpoint, I think we’re in pretty good shape financially and will find a way to make this work. With that said, I’d like to ensure we get all our ducks in a row beforehand – we’d be very grateful for your input on our situation.

Age: 35 / 32

Emergency Fund: 3 months

Debt:
$385K mortgage @ 2.625% (26 years left). Planning on this being our "forever" home and do not anticipate paying off early due to the interest rate.
$16K car loan @ 0.9% (under 2 years left). Decided to keep this due to low interest rate.

Tax Filing Status: MFJ

Tax Rate: 24% federal, 6.35% state

Desired Asset Allocation: 100% equities

His Income: $178K base + ~$45K bonus/RSUs. I’m aiming for a promotion over the next 6 months, but not banking on anything.
Her Income: $95K base + ~10k bonus. As mentioned above, my wife will no longer work, but this will be partially offset by child care costs we’re paying today.

Current Portfolio: $1.1M
Other Assets: $330K (home equity) and $79K (529 plans for kids)

Annual Savings:
Max 401k x 2 ($46K + $14K employer match)
Max Backdoor Roth IRA x 2 ($14K)
Max HSA x 2 ($8.3K)

Portfolio Breakdown:
401K ($820K): 100% Dryden S&P 500
HSA ($41K): 100% VFIAX
ROTH IRAs ($215K): 100% VTSAX
TAXABLE ($33K): 100% VTSAX

A few other comments:
- Other than my wife’s 401K, we’re aiming to continue funding the other investing vehicles as usual (planning on staying 100% equities until ~50 years old)
- Our goal is to contribute to the 529 accounts where we can (with lump sum bonuses, etc.)
- To date, we’ve been maxing out the HSA and keeping this fully invested (keeping medical receipts for future reimbursement). I’d like to continue this going forward.
- We both have term life policies ($2M for him, $1M for her) and completed estate planning and wills when our first child was born
- We’re planning trade in our 12 year old compact sedan for a minivan within the next 6 months

A few things top of mind for me:
- Planning to increase our emergency fund (at least 6 months, maybe more?)
- While I have disability coverage through my work policy, I want to further investigate this and consider supplemental coverage
- Tighter scrutiny on monthly budgeting over the coming months and ensuring we’re handled from a cash flow perspective

We’d appreciate any feedback as well as any blind spots we might not be thinking about.

Thank you!

Congratulations on making a decision that will benefit everyone in your family.

Life insurance is generally for income replacement during the dependent-children-at-home years. I suggest ceasing life insurance payments related to non-income earners. That is what we did during your phase of life.

Good idea to fund at least 6 months of EF. 12 months even better.

[avalpert1]

Hi all,

It’s been about four years since I last posted a financial review, and a lot has changed since then. I appreciate everything I’ve learned from this community and would be grateful for some perspectives as we prepare for our next stage of life.

My wife and I have two kids (3 year old and 1.5 year old) with our 3rd on the way in March 2025. We’ve made a decision as a family for my wife to stop working and stay at home once her maternity leave concludes in the June timeframe.

From a big picture standpoint, I think we’re in pretty good shape financially and will find a way to make this work. With that said, I’d like to ensure we get all our ducks in a row beforehand – we’d be very grateful for your input on our situation.

Age: 35 / 32

Emergency Fund: 3 months

Debt:
$385K mortgage @ 2.625% (26 years left). Planning on this being our "forever" home and do not anticipate paying off early due to the interest rate.
$16K car loan @ 0.9% (under 2 years left). Decided to keep this due to low interest rate.

Tax Filing Status: MFJ

Tax Rate: 24% federal, 6.35% state

Desired Asset Allocation: 100% equities

His Income: $178K base + ~$45K bonus/RSUs. I’m aiming for a promotion over the next 6 months, but not banking on anything.
Her Income: $95K base + ~10k bonus. As mentioned above, my wife will no longer work, but this will be partially offset by child care costs we’re paying today.

Current Portfolio: $1.1M
Other Assets: $330K (home equity) and $79K (529 plans for kids)

Annual Savings:
Max 401k x 2 ($46K + $14K employer match)
Max Backdoor Roth IRA x 2 ($14K)
Max HSA x 2 ($8.3K)

Portfolio Breakdown:
401K ($820K): 100% Dryden S&P 500
HSA ($41K): 100% VFIAX
ROTH IRAs ($215K): 100% VTSAX
TAXABLE ($33K): 100% VTSAX

A few other comments:
- Other than my wife’s 401K, we’re aiming to continue funding the other investing vehicles as usual (planning on staying 100% equities until ~50 years old)
- Our goal is to contribute to the 529 accounts where we can (with lump sum bonuses, etc.)
- To date, we’ve been maxing out the HSA and keeping this fully invested (keeping medical receipts for future reimbursement). I’d like to continue this going forward.
- We both have term life policies ($2M for him, $1M for her) and completed estate planning and wills when our first child was born
- We’re planning trade in our 12 year old compact sedan for a minivan within the next 6 months

A few things top of mind for me:
- Planning to increase our emergency fund (at least 6 months, maybe more?)
- While I have disability coverage through my work policy, I want to further investigate this and consider supplemental coverage
- Tighter scrutiny on monthly budgeting over the coming months and ensuring we’re handled from a cash flow perspective

We’d appreciate any feedback as well as any blind spots we might not be thinking about.

Thank you!

Congratulations on making a decision that will benefit everyone in your family.

Life insurance is generally for income replacement during the dependent-children-at-home years. I suggest ceasing life insurance payments related to non-income earners. That is what we did during your phase of life.

I think that is very poor advice. The non-working caregiver may not be earning an income but they sure are displacing costs that would be required if they weren't there.

[warner25]

Life insurance is generally for income replacement during the dependent-children-at-home years. I suggest ceasing life insurance payments related to non-income earners.

I think that is very poor advice. The non-working caregiver may not be earning an income but they sure are displacing costs that would be required if they weren't there.

Yeah. If the stay-at-home parent is providing the equivalent of, say, ~$30k per year worth of child care, then that expense still needs to be covered if the stay-at-home parent dies. It's no different from replacing the income of an employed spouse, where ~$30k of their income is paying for childcare. So we got $600k, 20-year term coverage for my wife when she became a SAHM with our oldest kid.

Something I've been complaining about for many years is that it seems impossible to get sufficient disability insurance for a stay-at-home parent. Based on my logic above, I'd buy it, but no such product seems to exist. I've written before about maximizing uninsured / underinsured motorist coverage as the next best option, since it might cover a broader range of expenses following an accident, and a car accident is a likely cause of disability.

[RetiredAL]

Life insurance is generally for income replacement during the dependent-children-at-home years. I suggest ceasing life insurance payments related to non-income earners.

I think that is very poor advice. The non-working caregiver may not be earning an income but they sure are displacing costs that would be required if they weren't there.

Yeah. If the stay-at-home parent is providing the equivalent of, say, ~$30k per year worth of child care, then that expense still needs to be covered if the stay-at-home parent dies. It's no different from replacing the income of an employed spouse, where ~$30k of their income is paying for childcare. So we got $600k, 20-year term coverage for my wife when she became a SAHM with our oldest kid.

........

+1 to avalpert1's and chassis's warner25's thoughts about SAHM's insurance needs.

[warner25]

...partially offset by child care costs we’re paying today...

I don't want to dispute this in general, but it's one assumption that should be tested, because it seems to be untrue for some families.

It's my observation that, even for an introvert / homebody, social isolation is one of the hardest things about being a stay-at-home parent. If the stay-at-home parent feels socially isolated and stir-crazy, and fills the void by putting the kids into numerous, expensive activities per day, driving around between them, shopping and getting food on-the-go, then I can see how it might easily become more expensive than paying for child care.

Another forum member tells the story of expecting his wife's driving mileage to drop by 50%, and seeing it actually increase by 50% instead. And then they started paying for part-time child care / preschool anyway because his wife needed a break.

So it comes down to knowing yourselves, and the "tighter scrutiny on monthly budgeting" might need to continue after making the transition to see what the new lifestyle is really costing.

[er999]

- Our goal is to contribute to the 529 accounts where we can (with lump sum bonuses, etc.)
We’d appreciate any feedback as well as any blind spots we might not be thinking about.

Thank you!

I’d suggest getting the 2% cash back fidelity card and having it automatically deposited into a 529. My co-worker did that at her child’s birth and had $50k in it at 18. Quite good for a no fee card.

Biggest blind spot (or not, as you’ve probably already thought about it) is don’t get divorced 10 years from now with a stay at home spouse as you will pay a lot.

Seems like $180k family income and good savings habits with 1.1 million in your 30s should be fine, but perhaps not so much if split in half.

I disagree with the comment you don’t need life insurance on the non working spouse. If she died next year and you were left with 3 young children it would be quite costly for childcare. Something like $500k in life insurance shouldn’t be that expensive but could pay for a nanny or two if something happened when your kids are young.

[ruralavalon]

Congratulations on your decision to focus on family. In my opinion you are doing well financially.

. . . . . .

A few things top of mind for me:
- Planning to increase our emergency fund (at least 6 months, maybe more?)
- While I have disability coverage through my work policy, I want to further investigate this and consider supplemental coverage
- Tighter scrutiny on monthly budgeting over the coming months and ensuring we’re handled from a cash flow perspective

We’d appreciate any feedback as well as any blind spots we might not be thinking about.

Thank you!

Make sure you have/get an "own occupation " disability income policy.

It looks to me like you are on top of all the right things.

[chassis]

Insurance is financially a bad investment. This is universally agreed on this site by those who confront the data.

While the hypothetical decease of a full time parent would be tragic, financially it would result in lower expenses to the household, which would then be balanced with higher childcare expenses. It’s the classic insurance scenario - how much to pay for something that is unlikely to happen? Insurance is mainly a partial remedy for fear. Insurance is financially a bad choice in nearly every case.

If the totality of all advice was heeded on this site, portfolio withdrawal rate in retirement would be 0.0001%, excluding Social Security, pension and real estate, and anything that could be mentally conceived would be insured against.

[GarfieldBogle]

Even if you never invest again, implying a 7% rate of return on your 1.1M portfolio would leave you roughly 8M by age 65.

It seems you and spouse have done a great job of investing in your earlier years.

[bd7]

Insurance is financially a bad investment.

IMO insurance isn't an investment at all, but in those cases where it is sold as or bought as an investment I'll agree probably is a terrible one.

Insurance is financially a bad choice in nearly every case.

That's just silly.

[avalpert1]

Insurance is financially a bad investment. This is universally agreed on this site by those who confront the data.

It is only 'universally' agreed upon by the people in a universe who just fundamentally don't understand what financial risk management is and why you do it.

Of course the 'average' insured person doesn't recoup the cost of insurance (at least outside of publicly funded/subsidized insurance markets). If they did insurers wouldn't insure them. But the 'average' person is a statistical artifact and not a real individual. Real individuals have the ability to take more financial chances in other areas when they insure against tail events that could substantially harm them financially. That insurances isn't a bad financial investment it is prudent and wise financial risk management.

Insurance is mainly a partial remedy for fear. Insurance is financially a bad choice in nearly every case.

This is terrible, terrible 'advice'.

[chassis]

Insurance is financially a bad investment. This is universally agreed on this site by those who confront the data.

It is only 'universally' agreed upon by the people in a universe who just fundamentally don't understand what financial risk management is and why you do it.

Of course the 'average' insured person doesn't recoup the cost of insurance (at least outside of publicly funded/subsidized insurance markets). If they did insurers wouldn't insure them. But the 'average' person is a statistical artifact and not a real individual. Real individuals have the ability to take more financial chances in other areas when they insure against tail events that could substantially harm them financially. That insurances isn't a bad financial investment it is prudent and wise financial risk management.

Insurance is mainly a partial remedy for fear. Insurance is financially a bad choice in nearly every case.

This is terrible, terrible 'advice'.

Are you an insurance salesperson or remunerated in any way by any insurance or insurance-like product?

[avalpert1]

Insurance is financially a bad investment. This is universally agreed on this site by those who confront the data.

It is only 'universally' agreed upon by the people in a universe who just fundamentally don't understand what financial risk management is and why you do it.

Of course the 'average' insured person doesn't recoup the cost of insurance (at least outside of publicly funded/subsidized insurance markets). If they did insurers wouldn't insure them. But the 'average' person is a statistical artifact and not a real individual. Real individuals have the ability to take more financial chances in other areas when they insure against tail events that could substantially harm them financially. That insurances isn't a bad financial investment it is prudent and wise financial risk management.

Insurance is mainly a partial remedy for fear. Insurance is financially a bad choice in nearly every case.

This is terrible, terrible 'advice'.

Are you an insurance salesperson or remunerated in any way by any insurance or insurance-like product?

LOL, no. Just someone who actually worked in risk management at some point... turning wariness of insurance salesmen into a complete misunderstanding of insurance isn't wise behavior but a good way to end up in financial ruin due to emotionally-driven irrational choices. It's basically analogous to deciding you'll never eat again because of misleading health claims from food manufacturers.

[chassis]

Insurance is financially a bad investment.

IMO insurance isn't an investment at all

Of course it isn’t. Insurance salespeople, however, might disagree with you and me.

Insurance is an expense to be scrutinized for its benefit in comparison to its cost. It is a trivial exercise to find examples on this site where insurance is declined or foregone and called out for what it is, a bad investment of monetary resources. The word investment in this case is used in the broadest and most comprehensive sense imaginable.

[warner25]

Insurance is financially a bad investment. This is universally agreed on this site by those who confront the data.

I think the consensus here is that insurance isn't an investment at all (e.g. whole life is terrible because it mixes insurance with an investment component), it's a way to transfer risks that you can't afford to accept, so it comes at a cost (e.g. the expected return is negative). The real question is whether a family can accept the financial risk of a stay-at-home parent dying. To your point, the answer is subjective and will depend on ages, assets, goals, extended family situation, etc.

While the hypothetical decease of a full time parent would be tragic, financially it would result in lower expenses to the household...

You paint it as being almost financially neutral. If true, your conclusion would be correct; don't pay premiums to transfer a $0 risk. But I have a hard time seeing it this way for my own family. I'm pretty sure that hiring a full-time nanny, or a rotating team of service providers, or altering my career path to replace my SAHM wife, would cost vastly more than what little she personally consumes. Or we're talking about simply living a reduced lifestyle (e.g. moving into a lesser home or neighborhood, giving up various goals), but that's exactly the risk that life insurance on my wife can help to mitigate.

[ThankYouJack]

Life insurance is generally for income replacement during the dependent-children-at-home years. I suggest ceasing life insurance payments related to non-income earners.

I think that is very poor advice. The non-working caregiver may not be earning an income but they sure are displacing costs that would be required if they weren't there.

Yeah. If the stay-at-home parent is providing the equivalent of, say, ~$30k per year worth of child care, then that expense still needs to be covered if the stay-at-home parent dies. It's no different from replacing the income of an employed spouse, where ~$30k of their income is paying for childcare. So we got $600k, 20-year term coverage for my wife when she became a SAHM with our oldest kid.

IMO, Social Security survivor benefits should be factored into the equation. Would be good for the OP to sign onto SSA.gov to get a feel for the monthly amount. Could cover additional expenses like child care and then some.

[ruralavalon]

Insurance is financially a bad investment. This is universally agreed on this site by those who confront the data.
. . . . .

. . . Insurance is financially a bad choice in nearly every case.

If the totality of all advice was heeded on this site, portfolio withdrawal rate in retirement would be 0.0001%, excluding Social Security, pension and real estate, and anything that could be mentally conceived would be insured against.

Insurance is not an investment at all, certainly not a good investment, no matter what insurance agents say.

Term life insurance can be a good way to manage the risk of the death of an employed person with dependants. A disability income policy can be a good way to manage the risk of income loss from disability. A Single Premium Immediate Annuity (SPIA) can be a good way to manage longevity risk.

[warner25]

Social Security survivor benefits should be factored into the equation.

True, I'm usually one to bring this up during any conversation about life insurance. I was surprised a few years ago to learn just how much income my wife would receive from SS and my employer-provided survivor benefit program(s) if I died, even without any life insurance coverage on me.

I've thought less about it for my wife, because she doesn't have sufficient work history to qualify for SS on her own. I know that precludes her from getting SS disability, but would our kids still get SS survivor benefits if she died? I just looked into this briefly and couldn't find a clear answer; most discussions about SAHMs focus instead on what they're entitled to if their husband dies.

[Dottie57]

Insurance is financially a bad investment.

IMO insurance isn't an investment at all, but in those cases where it is sold as or bought as an investment I'll agree probably is a terrible one.

Insurance is financially a bad choice in nearly every case.

That's just silly.

+1. Insurance is risk mitigation for some of life’s most terrible events. Everyone dies. You can’t mitigate death but youcan mitigate the financial consequences. Same for disability.

[dratkinson]

Extended-tier EF.  You could add bonds to taxable to create an extended-tier EF.  Why?
--You're thinking you need a larger EF.
--Bonds are safer than stocks.
--Can be chosen to return more than TBM and 5yr CDs.  Exception for current inverted-yield interest-rate environment.
--Serve multiple purposes: extended-tier of 1st-tier EFs (savings, CDs,...), home projects, new car, dry powder, ...and retirement if not used otherwise.
--Having both stocks/bonds in taxable gives you 2x the opportunity to TLH. (I have. It wasn't terrible. Carryover losses are nice at tax time.)

Which bonds?  When I went through this drill in 22% fed tax bracket (created multiple sample tax returns), I chose VWLTX (LT national muni fund). Why?
--VWLTX SEC yield: 3.6%; TEY (taxable-equivalent yield) = 3.6%/(1-.22) = 4.09%; see: https://investor.vanguard.com/investmen ... file/vwltx
--VBTLX (TBM) SEC yield: 4.16%; see: https://investor.vanguard.com/investmen ... file/vbtlx

Current inverted-yields are skewing returns of ST-IT bonds/savings/CDs.  When rates return to normal, expect LT muni to outperform TBM and 5yr CDs.

Muni dividends don't add to AGI, so don't push you toward next tax bracket.

Same logic should apply to you if you drop into 22%.  Better outcome if promotion or tax code sunset increases your tax bracket.

[Keebtree]

Insurance is financially a bad investment.

IMO insurance isn't an investment at all, but in those cases where it is sold as or bought as an investment I'll agree probably is a terrible one.

Insurance is financially a bad choice in nearly every case.

That's just silly.

+1. Insurance is risk mitigation for some of life’s most terrible events. Everyone dies. You can’t mitigate death but youcan mitigate the financial consequences. Same for disability.

+1 on insurance, I would review in depth what you believe your term life insurance needs are as well as disability needs. Everyone manages risk in a different way, and therefore your answer will depend on your personal situation. Some people don't need any, some people can't sleep at night without. For us, with my wife being a SAHM, we have term life insurance in place for her. I would not be able to keep my current job if she passes and would have to downshift to the point where it would impact our lives financially, or would have to get significant support at home. I manage that risk with term life insurance that is relatively inexpensive, hoping i will never need it.

Also review expenses and keep a view on budget as you settle into your new reality. I can echo the story above that for us, when my wife stopped working, her expenses INCREASED (more driving, more activities with the kids, more social activities to get out of the house, etc).

[KlangFool]

Desired Asset Allocation: 100% equities

His Income: $178K base + ~$45K bonus/RSUs. I’m aiming for a promotion over the next 6 months, but not banking on anything.
Her Income: $95K base + ~10k bonus. As mentioned above, my wife will no longer work, but this will be partially offset by child care costs we’re paying today.

Current Portfolio: $1.1M
Other Assets: $330K (home equity) and $79K (529 plans for kids)

Annual Savings:
Max 401k x 2 ($46K + $14K employer match)
Max Backdoor Roth IRA x 2 ($14K)
Max HSA x 2 ($8.3K)

ucj11,

1) What is your current annual expense?

2) How much is your current child care costs?

3) Based on your gross income and annual savings, it looks like your current annual expense is very high.

4) You should not be 100% stock and 100% VTSAX. You are taking unnecessary risk for a very little gain.

5) Your portfolio is big enough that you should start reducing your exposure.

6) Depending on your annual expense, you will be financially independent before 50 years old.

7) Why would you want to contribute to the 529s when you can retire before your kids go to college?

KlangFool

[Valhalla7]

Hi all,

It’s been about four years since I last posted a financial review, and a lot has changed since then. I appreciate everything I’ve learned from this community and would be grateful for some perspectives as we prepare for our next stage of life.

My wife and I have two kids (3 year old and 1.5 year old) with our 3rd on the way in March 2025. We’ve made a decision as a family for my wife to stop working and stay at home once her maternity leave concludes in the June timeframe.

From a big picture standpoint, I think we’re in pretty good shape financially and will find a way to make this work. With that said, I’d like to ensure we get all our ducks in a row beforehand – we’d be very grateful for your input on our situation.

Age: 35 / 32

Emergency Fund: 3 months

Debt:
$385K mortgage @ 2.625% (26 years left). Planning on this being our "forever" home and do not anticipate paying off early due to the interest rate.
$16K car loan @ 0.9% (under 2 years left). Decided to keep this due to low interest rate.

Tax Filing Status: MFJ

Tax Rate: 24% federal, 6.35% state

Desired Asset Allocation: 100% equities

His Income: $178K base + ~$45K bonus/RSUs. I’m aiming for a promotion over the next 6 months, but not banking on anything.
Her Income: $95K base + ~10k bonus. As mentioned above, my wife will no longer work, but this will be partially offset by child care costs we’re paying today.

Current Portfolio: $1.1M
Other Assets: $330K (home equity) and $79K (529 plans for kids)

Annual Savings:
Max 401k x 2 ($46K + $14K employer match)
Max Backdoor Roth IRA x 2 ($14K)
Max HSA x 2 ($8.3K)

Portfolio Breakdown:
401K ($820K): 100% Dryden S&P 500
HSA ($41K): 100% VFIAX
ROTH IRAs ($215K): 100% VTSAX
TAXABLE ($33K): 100% VTSAX

A few other comments:
- Other than my wife’s 401K, we’re aiming to continue funding the other investing vehicles as usual (planning on staying 100% equities until ~50 years old)
- Our goal is to contribute to the 529 accounts where we can (with lump sum bonuses, etc.)
- To date, we’ve been maxing out the HSA and keeping this fully invested (keeping medical receipts for future reimbursement). I’d like to continue this going forward.
- We both have term life policies ($2M for him, $1M for her) and completed estate planning and wills when our first child was born
- We’re planning trade in our 12 year old compact sedan for a minivan within the next 6 months

A few things top of mind for me:
- Planning to increase our emergency fund (at least 6 months, maybe more?)
- While I have disability coverage through my work policy, I want to further investigate this and consider supplemental coverage
- Tighter scrutiny on monthly budgeting over the coming months and ensuring we’re handled from a cash flow perspective

We’d appreciate any feedback as well as any blind spots we might not be thinking about.

Thank you!

Congratulations on making a decision that will benefit everyone in your family.

Life insurance is generally for income replacement during the dependent-children-at-home years. I suggest ceasing life insurance payments related to non-income earners. That is what we did during your phase of life.

Good idea to fund at least 6 months of EF. 12 months even better.

There’s a caveat though. We carry a $1m term policy for my wife even though she makes next to nothing. My job is hyper-demanding and very hard on the home front. So, god forbid, something happens to her, *I* would need to quit my job immediately to care for the kids while I figure out a new path forward. There is no scenario where I could single parent with my current position so carrying a term policy for her makes sense and she’s young and fit enough that it only costs ~$40 a month so NBD.

[snowday2022]

Hi all,

It’s been about four years since I last posted a financial review, and a lot has changed since then. I appreciate everything I’ve learned from this community and would be grateful for some perspectives as we prepare for our next stage of life.

My wife and I have two kids (3 year old and 1.5 year old) with our 3rd on the way in March 2025. We’ve made a decision as a family for my wife to stop working and stay at home once her maternity leave concludes in the June timeframe.

From a big picture standpoint, I think we’re in pretty good shape financially and will find a way to make this work. With that said, I’d like to ensure we get all our ducks in a row beforehand – we’d be very grateful for your input on our situation.

Age: 35 / 32

Emergency Fund: 3 months

Debt:
$385K mortgage @ 2.625% (26 years left). Planning on this being our "forever" home and do not anticipate paying off early due to the interest rate.
$16K car loan @ 0.9% (under 2 years left). Decided to keep this due to low interest rate.

Tax Filing Status: MFJ

Tax Rate: 24% federal, 6.35% state

Desired Asset Allocation: 100% equities

His Income: $178K base + ~$45K bonus/RSUs. I’m aiming for a promotion over the next 6 months, but not banking on anything.
Her Income: $95K base + ~10k bonus. As mentioned above, my wife will no longer work, but this will be partially offset by child care costs we’re paying today.

Current Portfolio: $1.1M
Other Assets: $330K (home equity) and $79K (529 plans for kids)

Annual Savings:
Max 401k x 2 ($46K + $14K employer match)
Max Backdoor Roth IRA x 2 ($14K)
Max HSA x 2 ($8.3K)

Portfolio Breakdown:
401K ($820K): 100% Dryden S&P 500
HSA ($41K): 100% VFIAX
ROTH IRAs ($215K): 100% VTSAX
TAXABLE ($33K): 100% VTSAX

A few other comments:
- Other than my wife’s 401K, we’re aiming to continue funding the other investing vehicles as usual (planning on staying 100% equities until ~50 years old)
- Our goal is to contribute to the 529 accounts where we can (with lump sum bonuses, etc.)
- To date, we’ve been maxing out the HSA and keeping this fully invested (keeping medical receipts for future reimbursement). I’d like to continue this going forward.
- We both have term life policies ($2M for him, $1M for her) and completed estate planning and wills when our first child was born
- We’re planning trade in our 12 year old compact sedan for a minivan within the next 6 months

A few things top of mind for me:
- Planning to increase our emergency fund (at least 6 months, maybe more?)
- While I have disability coverage through my work policy, I want to further investigate this and consider supplemental coverage
- Tighter scrutiny on monthly budgeting over the coming months and ensuring we’re handled from a cash flow perspective

We’d appreciate any feedback as well as any blind spots we might not be thinking about.

Thank you!

Congratulations on making a decision that will benefit everyone in your family.

Life insurance is generally for income replacement during the dependent-children-at-home years. I suggest ceasing life insurance payments related to non-income earners. That is what we did during your phase of life.

Good idea to fund at least 6 months of EF. 12 months even better.

There’s a caveat though. We carry a $1m term policy for my wife even though she makes next to nothing. My job is hyper-demanding and very hard on the home front. So, god forbid, something happens to her, *I* would need to quit my job immediately to care for the kids while I figure out a new path forward. There is no scenario where I could single parent with my current position so carrying a term policy for her makes sense and she’s young and fit enough that it only costs ~$40 a month so NBD.

Grandparents, au pair, or 2 nannies

[Valhalla7]

7) Why would you want to contribute to the 529s when you can retire before your kids go to college?

KlangFool

Can you elaborate? This reads as if you’re suggesting leaving your children to their own devices for their education.

[Valhalla7]

Grandparents, au pair, or 2 nannies

Not trying be combative but do you know many nannies or grandparents that can be available at 3:30am when I leave for work on days? I have a five year old and two year old. I work a four on four off rotating shift and alternate days and nights 4am-4pm and vice versa plus ~400 hours of overtime a year. This scenario would require living with the grandparents full time. My side of the family, that is not sustainable due to interpersonal shit. Her side of the family lives 1000 miles away. So concessions have to be made. That’s where the term policy comes in.

[KlangFool]

7) Why would you want to contribute to the 529s when you can retire before your kids go to college?

KlangFool

Can you elaborate? This reads as if you’re suggesting leaving your children to their own devices for their education.

Valhalla7,

If OP is retiring before the kids go to college, why would OP want to limit the kids ability to get financial aid with money in the 529s? OP can utilizes the financial aid as much as possible and then pay the rest.

KlangFool

[snowday2022]

Grandparents, au pair, or 2 nannies

Not trying be combative but do you know many nannies or grandparents that can be available at 3:30am when I leave for work on days? I have a five year old and two year old. I work a four on four off rotating shift and alternate days and nights 4am-4pm and vice versa plus ~400 hours of overtime a year. This scenario would require living with the grandparents full time. My side of the family, that is not sustainable due to interpersonal shit. Her side of the family lives 1000 miles away. So concessions have to be made. That’s where the term policy comes in.

It’s fine to have a term policy in your SAHM spouse. I have the same. But do your kids wake up at 330am routinely? Yes somebody must be present. Lots of folks have kids essentially raised by hired help. Hell, I have friends who hired wet nurses who worked all night until their babies slept through the night. It could be done without quitting your job but yes it would cost money.

Whether life insurance for your spouse makes sense depends on your income. If you could comfortably afford hired help, without a major dent in your finances then it may not make sense. Most people cannot, but many BHs could.

[dogagility]

We’d appreciate any feedback...

Very nice setup.

[FlowWithTheGo]

You are better off than we were when we made the decision to have kids and for wife to leave work force. 4 year olds are better than 3 year olds so this whole thing will get more fun.

You may want to create a big book of death or store copies of wills, insurance policies, financial stuff on a site like fidsafe that has beneficiary access.

Maybe some stagger insurance policies so you have some expire in 20 years and others at 10 years because your net worth will grow and you will probably need less then.

Get umbrella insurance.

If it makes it easier think of your portfolio as replacing part of your income.

Don't be surprised if the plan was for her to go back to work in 5 years changes to wanting more kids or having her stay at home longer.

[Dottie57]

7) Why would you want to contribute to the 529s when you can retire before your kids go to college?

KlangFool

Can you elaborate? This reads as if you’re suggesting leaving your children to their own devices for their education.

Valhalla7,

If OP is retiring before the kids go to college, why would OP want to limit the kids ability to get financial aid with money in the 529s? OP can utilizes the financial aid as much as possible and then pay the rest.

KlangFool

This is a smart move if you can retire before kids in school.

[White Coat Investor]

My wife and I have two kids (3 year old and 1.5 year old) with our 3rd on the way in March 2025. We’ve made a decision as a family for my wife to stop working and stay at home once her maternity leave concludes in the June timeframe.

We did this at age 29/26 with our first and have no regrets at all about it. My wife now works more than I do at WCI. The money will probably work out. Child care alone is hecka expensive and a typical stay at home parent does way more than that.

It can affect her career progression and peak earnings though, so tread carefully.

[warner25]

...no regrets at all about it... The money will probably work out...

To be fair, in case the OP doesn't know who you are, you haven't had a... typical career and earnings trajectory. For your family, I think the money "worked out" in a way that isn't going to happen for ~99.999% of other families.

But I do think the OP will be fine. My family took this path when I was earning far less and had ~1/4 of the portfolio, and (arguably) I'm still earning less than the OP, but we'll probably still reach FI in our 40s with in-state college costs covered.

[White Coat Investor]

...no regrets at all about it... The money will probably work out...

To be fair, in case the OP doesn't know who you are, you haven't had a... typical career and earnings trajectory. For your family, I think the money "worked out" in a way that isn't going to happen for ~99.999% of other families.

But I do think the OP will be fine. My family took this path when I was earning far less and had ~1/4 of the portfolio, and (arguably) I'm still earning less than the OP, but we'll probably still reach FI in our 40s with in-state college costs covered.

It's less about the OPs career following my path than the natural progression of the career of someone married to a SAHP. Because my wife took care of so much for those years, I was able to be a lot more successful in my career AND we saved a ton in expenses. I think those can apply to just about anyone.

[warner25]

...natural progression of the career...

True. In just a few years after we gave up my wife's ~$35k income (public school teacher in the southeast, at the bottom of the pay scale [1]), my income grew by $35k+, so we never really felt the loss [2]; we continued saving a similar percentage and dollar amount. I don't know how realistic it is for the OP's income to jump by another $100k+ in the near future, but it's something to think about.

[1] Her low salary made the decision pretty easy in our case, because after subtracting taxes at our marginal rate and the cost of child care, she would have been working for a laughably low amount of money. And on that trajectory, her own SS still might have been less than spousal benefits on my work record.

[2] We could speculate how much my wife's income might have grown over time, and see how much this decision cost us, but that's an abstract alternate reality instead of something salient that we gave up.

[majiaknight]

...
Emergency Fund: 3 months
...
Current Portfolio: $1.1M
Other Assets: $330K (home equity) and $79K (529 plans for kids)
...
Portfolio Breakdown:
401K ($820K): 100% Dryden S&P 500
HSA ($41K): 100% VFIAX
ROTH IRAs ($215K): 100% VTSAX
TAXABLE ($33K): 100% VTSAX

A few other comments:
- Other than my wife’s 401K, we’re aiming to continue funding the other investing vehicles as usual (planning on staying 100% equities until ~50 years old)
- Our goal is to contribute to the 529 accounts where we can (with lump sum bonuses, etc.)

In my opinion, your financial situation is in very good shape. Once your wife makes the move next year, you might consider increasing your emergency fund to 9-12 months’ worth of expenses for added peace of mind.

Since you have limited assets outside of your retirement accounts (401K, IRA, HSA), I would suggest deprioritizing contributions to the 529 plan in favor of growing your taxable accounts for more flexible spending options as you have a large family to take care of.

[ruralavalon]

...no regrets at all about it... The money will probably work out...

To be fair, in case the OP doesn't know who you are, you haven't had a... typical career and earnings trajectory. For your family, I think the money "worked out" in a way that isn't going to happen for ~99.999% of other families.

But I do think the OP will be fine. My family took this path when I was earning far less and had ~1/4 of the portfolio, and (arguably) I'm still earning less than the OP, but we'll probably still reach FI in our 40s with in-state college costs covered.

My wife was a stay at home mom, no regrets at all on that.

[ucj11]

OP here. Thanks so much for the responses and helping me work through my thought process.

Working my way through the thread:

After your wife quits working it appears your Federal tax bracket will drop to 22%. Will the state bracket drop as well?

No international stock index fund? Is that on purpose?

Good call out – it looks like our state bracket drops as well (decreases by 0.5%).

In regards to the lack of international exposure, yes - this is intentional. I know there are varying views on this, but I’ve found myself generally aligned with the rationale from Bogle / Buffett on the domestic US markets.

Do you have a good grasp on what your expenses are? What percent of your gross income will all your fixed expenses be based off just your income?

Will you be able to save enough to add to your EF and reach the 6 month goal you mentioned, plus max your Roth IRA, plus max her Roth IRA every year?

I think we're reasonably solid on understanding our expenses, but this is an area where I’m sure we have an opportunity to get tighter. We haven't looked at this yet with a fine tooth comb, and I imagine there are areas we can cut. Currently we're at approx. $12K monthly expenses, with mortgage ($2.9K) and child care ($2.6K) being two big ticket areas.

My thought was to use our lump sum bonus this year to augment the EF, but candidly the plan to continue maxing both Roths might be a bit ambitious (at least right away). In my mind, I think it’s probably best to prioritize the EF and go from there.

We did this same thing many years ago when we were in your shoes. One of the things we did, just as sort of a thought exercise, was to separate our money and live off the one income that would be continuing during the pregnancy. It definitely help put our minds at ease.

Love this idea! Going to bring this up to my wife and propose that we implement this ourselves. I still haven't landed the peace of mind component and I can see how this could help.

We made this choice ourselves.

DW hated her job, and we had arranged our life to work, with some stretching, on one income. It took a few years for us to get the details right, but we are both happy with our choice. We do honestly believe that contributions are equal, and that dollars are not the only way to measure.

One unintended consequence - she is dreadfully tired of people claiming that homemaking, volunteer work and activism “isn’t work”. Talk that one through at length, and get on the same page. Enough strangers will judge your family, so you need to be well aligned.

Very helpful call-out. We've talked about this to a degree, but will spend more time here. Your point around equal contributions resonates quite a bit, particularly as I've become a parent and understand what's involved.

In regards to the debate above around life insurance, I'm firmly in the camp of continuing my wife's term policy. We have a $1m policy for her (about 17 years left) for $21/month. It strikes me as pretty short-sighted and imprudent to consider cancelling this policy to save a few bucks.

I'll plan to circle back with replies to the other comments. Again, really appreciate everyone's perspective.

[KlangFool]

I think we're reasonably solid on understanding our expenses, but this is an area where I’m sure we have an opportunity to get tighter. We haven't looked at this yet with a fine tooth comb, and I imagine there are areas we can cut. Currently we're at approx. $12K monthly expenses, with mortgage ($2.9K) and child care ($2.6K) being two big ticket areas.

ucj11,

Your numbers do not add up to 12K per month of expense.

"His Income: $178K base + ~$45K bonus/RSUs. I’m aiming for a promotion over the next 6 months, but not banking on anything.
Her Income: $95K base + ~10k bonus."

A) Your gross income = 328K

"Annual Savings:
Max 401k x 2 ($46K + $14K employer match)
Max Backdoor Roth IRA x 2 ($14K)
Max HSA x 2 ($8.3K)"

B) Your annual savings = 68.3K~ 70K

C) Let's assume 30% taxes (very high estimate) = 98.4 ~ 100K

D) Annual expense = 328K - 100K - 70K = 158K. It is probably closer to 160K per year.

KlangFool

P.S.: Pay off the car loan. It distorts your actual annual expense.

[masha12]

Congratulations on making a decision that will benefit everyone in your family.

Life insurance is generally for income replacement during the dependent-children-at-home years. I suggest ceasing life insurance payments related to non-income earners. That is what we did during your phase of life.

You don’t drop life insurance on someone if her death would mean added expenses for the family. A SAHM isn’t paid, but that doesn’t mean her work doesn’t provide tangible value to the family. If the caregiving parent dies, someone is going to have to be paid to provide that care. Keep the life insurance policy at least until your kids are at an age where you wouldn’t need to have help managing the household.

[chicagoan23]

Since you have limited assets outside of your retirement accounts (401K, IRA, HSA), I would suggest deprioritizing contributions to the 529 plan in favor of growing your taxable accounts for more flexible spending options as you have a large family to take care of.

Agreed 100%. You only have $33k plus a three-month emergency fund for your unrestricted cash? That's pretty light, especially going down to one income.

I'd make after-tax savings and investing your top priority, even above the backdoor Roths and especially the 529s. Plus, you don't know what college will look like in 10-15 years and what financing/debt forgiveness will be available to you, but you do know that whatever is in a 529 account will be vaporized by the colleges and all you get in return is the avoidance of long-term capital gain taxes.

Also, as an aside, insurance is what allows the economy to function, even if it is an "expense" and not an "investment." No thoughtful person would build a factory, ship goods, open a store and stock it with merchandise, etc. if they could not protect against risk of loss with insurance. This has been true for about 4,000 years, dating back to the Code of Hammurabi. Of course you should keep reasonable life insurance for your spouse.

[dratkinson]

Since you have limited assets outside of your retirement accounts (401K, IRA, HSA), I would suggest deprioritizing contributions to the 529 plan in favor of growing your taxable accounts for more flexible spending options as you have a large family to take care of.

Agreed 100%. You only have $33k plus a three-month emergency fund for your unrestricted cash? That's pretty light, especially going down to one income.

+1. Pay yourself first. The way it was explained to me: kids can get a loan for school, but you can't get a loan for retirement.

[ucj11]

Continuing to work my way through the thread...

4) You should not be 100% stock and 100% VTSAX. You are taking unnecessary risk for a very little gain.

5) Your portfolio is big enough that you should start reducing your exposure.

6) Depending on your annual expense, you will be financially independent before 50 years old.

KlangFool

Can you unpack your comment around reducing stock exposure? Doesn't this question fundamentally come down to 1) time horizon and 2) personal risk tolerance?

If I build up an adequate emergency fund and liquid cash reserve, am comfortable with some level of risk, and plan to work for the next 25+ years, is a heavily stock-weighted portfolio really that wild of a proposition?

If OP is retiring before the kids go to college, why would OP want to limit the kids ability to get financial aid with money in the 529s? OP can utilizes the financial aid as much as possible and then pay the rest.

KlangFool

This wasn't something I had contemplated, but I can see your point. I appreciate the perspective and its good food for thought. Based on how I'm wired, I don't see the appeal of retiring early (it's not a goal of mine), but I do aspire to get to the point of financial independence and having options.

In my opinion, your financial situation is in very good shape. Once your wife makes the move next year, you might consider increasing your emergency fund to 9-12 months’ worth of expenses for added peace of mind.

Since you have limited assets outside of your retirement accounts (401K, IRA, HSA), I would suggest deprioritizing contributions to the 529 plan in favor of growing your taxable accounts for more flexible spending options as you have a large family to take care of.

Makes complete sense. Ramping up our EF and taxable accounts seems like a no-regrets move at this point.

[KlangFool]

Continuing to work my way through the thread...

4) You should not be 100% stock and 100% VTSAX. You are taking unnecessary risk for a very little gain.

5) Your portfolio is big enough that you should start reducing your exposure.

6) Depending on your annual expense, you will be financially independent before 50 years old.

KlangFool

Can you unpack your comment around reducing stock exposure? Doesn't this question fundamentally come down to 1) time horizon and 2) personal risk tolerance?

If I build up an adequate emergency fund and liquid cash reserve, am comfortable with some level of risk, and plan to work for the next 25+ years, is a heavily stock-weighted portfolio really that wild of a proposition?

ucj11,

1) At your saving rate, you will be financially independence before 25 years.

2) It is a lousy bet to be 100% stock.

https://investor.vanguard.com/investor- ... allocation

Average annual return for 100% stock is 10.2%.
Average annual return for 70/30 aka 70% stock is 9.1%

The difference is only 1.1% per year.

At your saving rate, the number of years to be financially independence is less than 25 years. It is a lousy bet. With 70/30, you can retire any time when you reach the number.

Assuming your annual expense is 160K per year and your number is 30X 160K = 4.8M

At 1.1 M and saving 70K per year,

With an average annual return of 5%, you will reach 4.8M in 18+ years.
With an average annual return of 7%, you will reach 4.8M in 15+ years.

Starting Net Worth $1,100,000
Annual Savings $70,000
Years
Annual Return Rate 14 15 16 17 18 19
5.00% $3,549,829 $3,797,320 $4,057,186 $4,330,046 $4,616,548 $4,917,375
6.00% $3,958,049 $4,265,532 $4,591,464 $4,936,952 $5,303,169 $5,691,359
7.00% $4,414,922 $4,793,966 $5,199,544 $5,633,512 $6,097,858 $6,594,708

3) You should not be 100% stock and 100% US stock.

KlangFool

[ruralavalon]

In my opinion an asset allocation of 100% stocks is unwise, even when decades away from expected retirement. About half of employees have found that they retired earlier than expected, most often involuntarily, link

An asset allocation of 100 stocks has been atypical among Bogleheads responding to the question "What ratio are you stocks/bonds and how old are you?"regression and bar graph