help with saving for retirement; feel like i'm very behind!

[childay]

What in the world is your wife spending 10-15k/mo on recurrently? I don’t even really understand that. That’s a lot more than we spend in a month on everything. I mean, it’s fine to treat yourself sometime - especially your spouse who supported you - and, honestly, that amount probably wouldn’t even sink you with your income, but common!??

Aside from high end travel or something I can't even think how I would spend 15K a month on myself. Not counting autos or housing. I mean it would be fun to try I guess

[childay]

Part of the problem is that you ultimately need to save about 25-30x of what you spend each year (more for early retirement). If you and your wife have grown accustomed to spending a lot and you can’t cut it back down then the amount you need to save for retirement is really high.

I’ve heard YNAB is a good budgeting tool.

This is key. You need to calculate your actual spending OP for any sort of accurate projections.

[GEAUXT]

my wifes issue is that she feels she was bottled up and sacrificed so much for this family (which she has and i agree with her) that she is now letting loose. I dont mind it, but i think we need to get it under control. Funny thing is she has bought a few hermes purses recently

This is not a thread to beat up on your spouse, but y'all need to sit down and have a serious financial discussion. Buying $5-10k purses is not investing.

Y'all can hit all of the investment goals recommended so far and still live better than 95%+ of the country.

Income does not equal wealth.

Also, as mentioned, y'all have to realize that the number needed to retire will be exponentially higher if you maintain your current spending versus changing to a VERY comfortable but reasonable lifestyle.

[omaralt]

why do you guys think i should pay off the car? i could pay if off tomorrow but its at 0.9% interest

[fatlittlepig]

why do you guys think i should pay off the car? i could pay if off tomorrow but its at 0.9% interest

how about yesterday

[Hank]

why do you guys think i should pay off the car? i could pay if off tomorrow but its at 0.9% interest

You don’t necessarily need to pay off a 0.9% car loan early. But with $1 million in annual income, you should be able to cash flow a $74K car instead of financing it.
Moreover, you’re likely to negotiate more aggressively if you have to cut a check for the car. You’re more likely to add unnecessary options if it’s only $50 more per month on the monthly payments.

You need a loan to pay for dental school, buy an $800K practice, or buy your primary residence. You shouldn’t need a loan to buy a car when you make $400K+
per year.

[omaralt]

You don’t necessarily need to pay off a 0.9% car loan early. But with $1 million in annual income, you should be able to cash flow a $74K car instead of financing it.
Moreover, you’re likely to negotiate more aggressively if you have to cut a check for the car. You’re more likely to add unnecessary options if it’s only $50 more per month on the monthly payments.

You need a loan to pay for dental school, buy an $800K practice, or buy your primary residence. You shouldn’t need a loan to buy a car when you make $400K+
per year.

i dont disagree. i bought the car last august and could've paid it cash, but with 0.9% interest it didn't make sense to me to pay it off early vs investing in the stock market. But i will pay it off asap

[bovie]

it's not like you've been doing nothing for the past 10 years. You have car debt and you need to get rid of that and not do it again. But you paid down a huge student loan burden and a practice loan. That increases your net worth a lot.

Going forward, I agree with others that you need to be saving ~30% for retirement. Stop 529 investing for now and prioritize retirement instead. You can always use retirement money to pay for college way down the road.

You said your wife is on board. That spending is an issue but honestly the crypto investing is just as much an issue to me. You need to read this: https://www.whitecoatinvestor.com/15...er-than-yours/

You need to pick a reasonable AA with 3-6 funds to invest in. Total market, total bond, and total international to start. No crypto. This is a marathon, not a sprint. Priorities:

1) Make a plan
2) Make sure your wife is spending less (but not $0 and if she's really been spending as much as you said you need to give her a long runway so she doesn't resent you....try to go to $3-5k/mo for 3-6 months and then down to $1-$3k/month for 3-6 months and forward.
3) 30% to retirement. Stop 529s. Pay off the car
4) If you can save more than 30% after doing 1, 2, and 3 for a year, go for it. Or restart 529 contributions

Agree with all, except for the bit about car debt. Strongly disagree with that.

I know that it's deep dogma around here to buy the car in cash blah blah blah, but financing at 0.9% is a no-brainer--especially with inflation over 8%.

There is no arguing with this, it's Math 101.

Free up cash flow, invest the difference (key), and inflate away debt. Even without runaway inflation, at 0.9% this is still a no-brainer 8 days a week.

Final thought--with income >$1M, I'm sleeping on the couch if wife only gets $1k/month LOL.

[CordMcNally]

thanks for replies

my wifes issue is that she feels she was bottled up and sacrificed so much for this family (which she has and i agree with her) that she is now letting loose. I dont mind it, but i think we need to get it under control. Funny thing is she has bought a few hermes purses recently which are actually worth a lot more than what she paid.. so she keeps reminding me that her investments are doing much better than mine!


i like the idea of taking the first $25k and putting it directly into my brokerage account. I will probably break it up into weekly $5k deposits for now.

i think the key is to have my wife (and myself) write down every penny we spend so we see where it is going.

I guess everyone has a definition of letting loose. Mine is buying a package of Oreos and a half gallon of milk and eating until I need to get horizontal. I only do it about once every 6 months, though.

You’ve got the income to still enjoy life and save a lot for retirement. I think for many people buying ‘stuff’ is a tough thing to give up. Maybe start with getting rid of the Bravo channel. ;-)

[bovie]

why do you guys think i should pay off the car? i could pay if off tomorrow but its at 0.9% interest

Do not pay off the car. Financially speaking, stupid move.

[fatlittlepig]

Agree with all, except for the bit about car debt. Strongly disagree with that.

I know that it's deep dogma around here to buy the car in cash blah blah blah, but financing at 0.9% is a no-brainer--especially with inflation over 8%.

There is no arguing with this, it's Math 101.

Free up cash flow, invest the difference (key), and inflate away debt. Even without runaway inflation, at 0.9% this is still a no-brainer 8 days a week.

Final thought--with income >$1M, I'm sleeping on the couch if wife only gets $1k/month LOL.

financing it would be OK for someone who is smart with money, for him i would simplify things and get rid of fleas (and 74K is a flea)

[bovie]

financing it would be OK for someone who is smart with money, for him i would simplify things and get rid of fleas (and 74K is a flea)

Currently a guaranteed 7% return by making minimum payment.

Again, it's math. Works the same for everyone.

Do not pay off the car.

[bovie]

i dont disagree. i bought the car last august and could've paid it cash, but with 0.9% interest it didn't make sense to me to pay it off early vs investing in the stock market. But i will pay it off asap

Again, do not do this. Put that $74k in the market ASAP. Stocks are on sale.

[Sampter]

Is the financed car yours of your wife's and what is it?

If yours I would consider selling it and buying a 30K Honda/Toyota/Subaru as part of the families journey to work together to save for the future and not overspend.

[Hank]

i dont disagree. i bought the car last august and could've paid it cash, but with 0.9% interest it didn't make sense to me to pay it off early vs investing in the stock market. But i will pay it off asap

But you didn’t put the money into the stock market. Your wife spent $10K to $15K per month on “stuff”. Even on the lower end of $10K per month, you could have paid off the car in full by March.

If you can reduce the discretionary spending by even $5,000 per month, that’s another $60K you can put towards retirement. Or a $75K car that you own free and clear in 15 months.