Hi - me (31M) and my wife (30F) live in a HCOL US city. Annual HHI is ~260k before an annual $30-40k bonus from my job, which we don't budget for (i.e. expect) since it's not guaranteed. We got married last year and combined our finances and we try and achieve ~50% savings rate. We both max out our 401ks and I contribute to a traditional IRA, although I haven't figured out the whole backdoor roth IRA yet. I'm told it should be a priority. Our current asset allocation is:
$697M NW
- $66k cash
- $198k taxable brokerage
- $288k retirement accounts (401ks and IRAs)
- $146k in home equity with another $580k left on the mortgage
We feel comfortable and lucky to be in the position that we're in, but we're also aware that we have so many things in our future that may impact our lifestyle and how much we can save (kids, family health, etc.). We also just bought a home that we like (don't love) and feel like we may want to move sooner than we initially expected - within the next five years, and maybe sooner.
I'll get to my question. Given the unknowns in our lives and our relative youthfulness, I'm having a hard time deciding whether or not to save as hard as we have in dedicated, tax-advantaged retirement accounts or if we should be allocating more to taxable brokerage accounts and our mortgage for more pre-59.5 money. I like my job (my wife hates hers), but I would like to be work-optional by early/mid 40s (~10 years from now if possible).
Our current monthly budget is:
- $7,500 for shared living expenses (mortgage, utilities, shared groceries/restaurants, vacations, subscriptions, healthcare, etc)
- $500 for my personal spending on toys, independent trips, personal takeout
- $500 for her personal spending on toys, independent trips, personal takeout
- $3,000 in our HYSA (which we periodically draw from an invest in taxable brokerage accounts when we feel comfortable)
- $2,000 in our taxable brokerage accounts
As I said above, we also max out our 401ks and I contribute extra money from bonus or elsewhere to an IRA every year (7-7.5k).
Any advice is welcome. Thank you.