Hi All,
Would love everyone’s input on our family’s proposed financial plan and would appreciate any recommendations you guys would make to make this plan better (the current plan is very much a work in progress). We are definitely lagging behind in terms of getting started with our investments, but thankfully have not made major financial mistakes yet (other than of course not starting our retirement funds sooner!).
Age: 32 (both of us, dual physician couple). Single child 2 years old.
Debts: $10k car (0% APR) – plan to pay it off well before 0% APR expires
Tax bracket: 33% (married) – both of us are hospital employed
Assets:
Emergency fund – working on building it up (currently at 3 months of expenses)
(Hoping to buy a house in about 4-5 years)
Investments:
His 403b (fidelity): 5k (2050 Blackrock fund)
Her 403b (fidelity): 7k (2050 Blackrock fund)
Proposed savings plan:
His 403b: $18,000 annually (no match)
His Roth IRA (backdoor): $5,500 annually
Her 403b: $18,000 annually (+$9,000 match)
Her 401a: $9,000 annually
Her Roth IRA (backdoor): $5,500 annually
Total tax advantaged: $65,000 per year
College fund: $28,000/year x 5 years (important to us to help pay for as much college/professional school as possible)
Proposed asset allocation:
Total stock market 45%
Growth index 10%
Small Growth 10%
Small Value 10%
Emerging Market 5%
Total int stock 10%
Bonds 10%
Questions:
Thanks in advance!
Would love everyone’s input on our family’s proposed financial plan and would appreciate any recommendations you guys would make to make this plan better (the current plan is very much a work in progress). We are definitely lagging behind in terms of getting started with our investments, but thankfully have not made major financial mistakes yet (other than of course not starting our retirement funds sooner!).
Age: 32 (both of us, dual physician couple). Single child 2 years old.
Debts: $10k car (0% APR) – plan to pay it off well before 0% APR expires
Tax bracket: 33% (married) – both of us are hospital employed
Assets:
Emergency fund – working on building it up (currently at 3 months of expenses)
(Hoping to buy a house in about 4-5 years)
Investments:
His 403b (fidelity): 5k (2050 Blackrock fund)
Her 403b (fidelity): 7k (2050 Blackrock fund)
Proposed savings plan:
His 403b: $18,000 annually (no match)
His Roth IRA (backdoor): $5,500 annually
Her 403b: $18,000 annually (+$9,000 match)
Her 401a: $9,000 annually
Her Roth IRA (backdoor): $5,500 annually
Total tax advantaged: $65,000 per year
College fund: $28,000/year x 5 years (important to us to help pay for as much college/professional school as possible)
Proposed asset allocation:
Total stock market 45%
Growth index 10%
Small Growth 10%
Small Value 10%
Emerging Market 5%
Total int stock 10%
Bonds 10%
Questions:
- Is our savings rate reasonable or should we be saving even more?
- Is the above proposed asset allocation reasonable? If not, what would you recommend?
- How should we divide up our asset allocation between Roth and pre-tax accounts (i.e. which assets should be in the Roth and which in the pre-tax accounts)? Planning on opening the Roth at Vanguard, but the pre-tax accounts are at Fidelity.
- Should we contribute smaller amounts per year to the college fund or contribute large amounts for fewer years and let that money grow? If we have more kids, it will be harder to contribute $28k per year for each child.
Thanks in advance!
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