As of November 5, 2015, we are $323,794.23 in debt with a mortgage. We currently have $911,271.88 in assets. Our investment accounts are at $492,498.51. Our Net Worth is $587,477.65, up from $576,110.21 last month (1.97% increase)
We’re almost at half a million dollars in our retirement accounts – as long as there is no major decline in the markets, we’ll get there just with our contributions before the end of the year.
I added another $250 to my Roth as I’m reasonably sure we’ll be under the MAGI this year because we’re contributing so much to our 403(b)s. That brought me well into the > 10k range for the advantage class fund. Next goal is to add $2500 to Dad’s Roth to get him up to being able to invest in a mutual fund rather than an ETF. He never had a Roth before last year (aka this February), and I’m not sure that it really makes sense for us to contribute that much to Roths right now because of our tax levels. I had one from when I didn’t make much, but that’s been sitting around growing for a while.
We’re steadily paying off the line of credit and once we do, we’ll be saving to put a deck on the new house next summer. We’re going to be building it ourselves with the assistance of a friend who has built them before, so that’ll save us a lot – and be quite the adventure!
Debt (in the order we’re paying it down):
- Line of Credit (8.75%): $5,600 (-1,200.00)
- Car loan – RAV4 (0%): $8,750 (-500.00)
- Car loan 2 – Camry (0%): $24,550 (-450.00)
- Mortgage (3.875%): $290,494.23 (-485.52)
Total paid off in September: $2,635.52
We have a pretty high income, but still do Roths. Mostly because we’ve already maxed out our other tax-preferred savings accounts, and I like the idea that we’ve got some tax-diversification to our “future assets”. Right now if we didn’t do Roth, we’d have to invest the money in a taxable account, and that seems kindof pointless if leaving Roth on the table as an option.
Yeah, we’ve been focusing on the taxable account rather than Roths. The Roths still have a 59.5 age limit for withdrawing earned money, we’ll need 10 years of living expenses between when we retire at 50 and can draw down our IRAs/403(b)s/etc at 59.5. The capital gains and dividends in our taxable account are 15% right now, and will be 0-10% in the future. In 10 years, how much will we really gain on the Roths to save maybe $2-3k in taxes? We’re going to start converting a lot of the IRAs into Roths once we’re not actively working anyway, taking the tax hit when it’s lower, and hopefully skirting RMDs in the future. I don’t hold a lot of faith that Roths are going to remain in their tax advantaged state, so I’d rather take my tax hits now with the known quantity than later, but that’s me.
I also have a high income, like the PoPs, and I use the Backdoor Roth. I save far more each year than what I can put into retirement accounts, so I’d rather save the money in a Roth IRA than in a taxable investment account. I definitely max out my pre-tax 401(k) before my Roth IRA, so if you’re not able to do that, I’d probably be working up on that one first. And attacking that line of credit before the Roth! 8.75% is crazy high!
We can’t do backdoor Roths because of significant amounts of money in IRAs (rollovers) outside of our 403(b)s that can’t be rolled into the 403(b)s, nor would we want to. We max out our 403(b)s and thanks to a mandatory contribution requirement in Dad’s company, we contribute more than the IRS 18k/yr (it’s 18k for voluntary contributions only) – next year, the mandatory contribution increases from 2% to 3%, so we’ll be putting even more in 🙂 We skirt the Roth contribution limits each year, so depending on the particular year, we may or may not be able to contribute. The line of credit is more to help cash flow than anything – I prefer to be a month ahead on bills, and this temporarily lets us do that since moving. It’ll be gone by January at the latest (we’re waiting to see what Dad’s bonus is to see if we wipe it out in December). $200 in interest is worth my peace of mind.
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