Hello Bogleheads!
I am a long time lurker and finally decided to take the time on this rainy Sunday to put together my first post. This is the standard “how is my retirement plan going” post. Thank you for all the wit and wisdom that you have shared on this forum over the years. It has helped me and the wife tremendously.
Emergency funds: Four months but this is slowly increasing with the intention to get to 6 months.
Salary: Gross income will be about $140k for both of us this year. We've both been fortunate to earn merit raises most years (and at least COLA).
Debt: Mortgage on house, $229,358 @ 7.5%, 30 year conventional
Tax Filing Status: Married Filing Jointly
Tax Rate: 22% Federal, 3.07% State
State of Residence: PA
Age: 31 (him) and 30 (her)
Desired Asset allocation: 100% stocks / 00% bonds
Desired International allocation: 00% of stocks
(Open to discussion on the point of AA, see below)
Approximate size of total portfolio: $177k
Taxable
14.33% Thrivent Large Cap Growth Fund - S (THLCX) (0.76%)
His 401k Roth IRA at Fulton Financial
37.15% Vanguard 500 Index Admiral (VFIAX) (0.04%)
Company match? Yes, 3% if he contributes 6%, which is the limit. He does currently match to the limit.
His Roth IRA at Vanguard
33.55% Vanguard 500 Index Admiral (VFIAX) (0.04%)
Her 401k Traditional IRA at American Century
11.42% One Choice 2060 Portfolio (ARGVX) (0.96%)
Company match? Yes, 3% if she contributes 3%. I need to get clarification if this is the limit of the match, but she does currently contribute 3%.
Her Roth IRA at Vanguard
3.55% Vanguard Total Stock Market ETF (VTI) (0.03%)
_______________________________________________________________
Contributions
New annual Contributions
$8,180 his 401k ($5,453 him, $2,727 employer match)
$3,072 her 401k ($1,536 her, $1,536 employer match)(This might fluctuate slightly as she is an hourly employee and each paycheck can vary by some small amount.)
$7,000 his Vanguard Roth IRA
$6,240 her Vanguard Roth IRA (I’m thinking this will actually increase to $6,740 by year end, trying to get to a place where we are maxing out both Roth IRAs.)
$0 taxable
Available funds
Funds available in his 401(k)
American Funds New World Fund (RNWGX) (0.57%)
Cohen and Steers Realty Fund (CSRSX) (0.88%)
Federated Capital Preservation Fund (CAPPR) (0.69%)
Federated Hermes MDT Small Cap Core Fund (QLSCX) (0.88%)
Fidelity Select Materials Portfolio (FSDPX) (0.71%)
FMI International Fund (FMIJX) (0.94%)
Invesco Gold & Special Minerals Fund (OGMIX) (0.66%)
Jensen Quality Growth Fund (JENSX) (0.82%)
JPMorgan Large Cap Growth Fund (JLGMX) (0.44%)
JPMorgan Mid Cap Growth Fund (JMGMX) (0.70%)
Manning & Napier Real Estate Fund (MNREX) (1.10%)
MFS Value Fund (MEIHX) (0.79%)
T. Rowe Price Capital Appreciation Fund (PRWCX) (0.71%)
T. Rowe Price Intl Discovery Fund (PRIDX) (1.24%)
T. Rowe Price Retirement 2050 Fund (approximate retirement decade) (TRRMX) (0.63%)
Vanguard 500 Index Fund (VFIAX) (0.04%)
Vanguard LifeStrategy Growth Fund (VASGX) (0.14%)
Vanguard Mid-Cap Index Fund (VIMAX) (0.05%)
Vanguard Mid-Cap Value Index Fund (VMVAX) (0.07%)
Vanguard Short-Term Bond Index Fund (VBIRX) (0.07%)
Vanguard Small-Cap Growth Index Fund (VSGAX) (0.07%)
Vanguard Small-Cap Index Fund (VSMAX) (0.05%)
Vanguard Total Bond Market Index Fund (VBTLX) (0.05%)
Vanguard Total Intl. Stock Index Fund (VTIAX) (0.12%)
Vanguard Wellesley Income Fund (VWIAX) (0.16%)
Funds available in her 401(k)
The American Century website is not good, but from what I can tell, we can invest in any American Century fund. It seemed silly to try and list them all here.
Questions:
Our current goal is to retire at age 60 (29 years from now) with about $3 million. I’m taking my best guess that $3 million will fund the retirement that we want to have. Using an annual rate of return of 7%, a monthly contribution rate of $2,041 (the total annual contributions divided by 12), and the current portfolio balance of $177k, we will hit that goal. Are my assumptions reasonable?
We currently pay an additional $500 per month on our mortgage. This effectively takes our 30 year mortgage to a 15 year mortgage. While we could invest that $500 every month, the 7.5% interest rate on the loan is greater than my assumed 7% annual return on retirement accounts. This leads me to believe that paying down the mortgage is the right move at this time. We both really like the idea of being mortgage free and have no plans to move from this house. Does paying down the mortgage seem like the best use of that “extra” $500 per month?
Her 401(k) target date fund at American Century with the 0.96% expense ratio seems very expensive to me. Can anyone point me towards a fund (or tool to find a fund) at American Century that has a more reasonable expense ratio? She was automatically enrolled in this fund when she started employment, and this is the first time I ever looked at the expense ratio…
I’ve had a 100% domestic stock AA since I began saving for retirement at the age of 25. I understand that I’ll need to begin to add bonds at some point, but I’m not sure when to begin that. I don’t currently have any trouble sleeping at night, but I’ve enjoyed good returns for the last several years (and understand that won’t last forever). When is it an appropriate time to begin adding bonds?
The intention is for any additional increases in salaries to go towards 401(k) contributions. We are trying to avoid lifestyle creep. I drive a 2000 Honda Civic and she drives a 2013 Subaru Forester. Both of which were paid for with cash and we intend to drive until it's no longer reasonable to do so. However, we are thinking of starting a family so the situation may change quite a bit over the next year.
Noah
I am a long time lurker and finally decided to take the time on this rainy Sunday to put together my first post. This is the standard “how is my retirement plan going” post. Thank you for all the wit and wisdom that you have shared on this forum over the years. It has helped me and the wife tremendously.
Emergency funds: Four months but this is slowly increasing with the intention to get to 6 months.
Salary: Gross income will be about $140k for both of us this year. We've both been fortunate to earn merit raises most years (and at least COLA).
Debt: Mortgage on house, $229,358 @ 7.5%, 30 year conventional
Tax Filing Status: Married Filing Jointly
Tax Rate: 22% Federal, 3.07% State
State of Residence: PA
Age: 31 (him) and 30 (her)
Desired Asset allocation: 100% stocks / 00% bonds
Desired International allocation: 00% of stocks
(Open to discussion on the point of AA, see below)
Approximate size of total portfolio: $177k
Taxable
14.33% Thrivent Large Cap Growth Fund - S (THLCX) (0.76%)
His 401k Roth IRA at Fulton Financial
37.15% Vanguard 500 Index Admiral (VFIAX) (0.04%)
Company match? Yes, 3% if he contributes 6%, which is the limit. He does currently match to the limit.
His Roth IRA at Vanguard
33.55% Vanguard 500 Index Admiral (VFIAX) (0.04%)
Her 401k Traditional IRA at American Century
11.42% One Choice 2060 Portfolio (ARGVX) (0.96%)
Company match? Yes, 3% if she contributes 3%. I need to get clarification if this is the limit of the match, but she does currently contribute 3%.
Her Roth IRA at Vanguard
3.55% Vanguard Total Stock Market ETF (VTI) (0.03%)
_______________________________________________________________
Contributions
New annual Contributions
$8,180 his 401k ($5,453 him, $2,727 employer match)
$3,072 her 401k ($1,536 her, $1,536 employer match)(This might fluctuate slightly as she is an hourly employee and each paycheck can vary by some small amount.)
$7,000 his Vanguard Roth IRA
$6,240 her Vanguard Roth IRA (I’m thinking this will actually increase to $6,740 by year end, trying to get to a place where we are maxing out both Roth IRAs.)
$0 taxable
Available funds
Funds available in his 401(k)
American Funds New World Fund (RNWGX) (0.57%)
Cohen and Steers Realty Fund (CSRSX) (0.88%)
Federated Capital Preservation Fund (CAPPR) (0.69%)
Federated Hermes MDT Small Cap Core Fund (QLSCX) (0.88%)
Fidelity Select Materials Portfolio (FSDPX) (0.71%)
FMI International Fund (FMIJX) (0.94%)
Invesco Gold & Special Minerals Fund (OGMIX) (0.66%)
Jensen Quality Growth Fund (JENSX) (0.82%)
JPMorgan Large Cap Growth Fund (JLGMX) (0.44%)
JPMorgan Mid Cap Growth Fund (JMGMX) (0.70%)
Manning & Napier Real Estate Fund (MNREX) (1.10%)
MFS Value Fund (MEIHX) (0.79%)
T. Rowe Price Capital Appreciation Fund (PRWCX) (0.71%)
T. Rowe Price Intl Discovery Fund (PRIDX) (1.24%)
T. Rowe Price Retirement 2050 Fund (approximate retirement decade) (TRRMX) (0.63%)
Vanguard 500 Index Fund (VFIAX) (0.04%)
Vanguard LifeStrategy Growth Fund (VASGX) (0.14%)
Vanguard Mid-Cap Index Fund (VIMAX) (0.05%)
Vanguard Mid-Cap Value Index Fund (VMVAX) (0.07%)
Vanguard Short-Term Bond Index Fund (VBIRX) (0.07%)
Vanguard Small-Cap Growth Index Fund (VSGAX) (0.07%)
Vanguard Small-Cap Index Fund (VSMAX) (0.05%)
Vanguard Total Bond Market Index Fund (VBTLX) (0.05%)
Vanguard Total Intl. Stock Index Fund (VTIAX) (0.12%)
Vanguard Wellesley Income Fund (VWIAX) (0.16%)
Funds available in her 401(k)
The American Century website is not good, but from what I can tell, we can invest in any American Century fund. It seemed silly to try and list them all here.
Questions:
Our current goal is to retire at age 60 (29 years from now) with about $3 million. I’m taking my best guess that $3 million will fund the retirement that we want to have. Using an annual rate of return of 7%, a monthly contribution rate of $2,041 (the total annual contributions divided by 12), and the current portfolio balance of $177k, we will hit that goal. Are my assumptions reasonable?
We currently pay an additional $500 per month on our mortgage. This effectively takes our 30 year mortgage to a 15 year mortgage. While we could invest that $500 every month, the 7.5% interest rate on the loan is greater than my assumed 7% annual return on retirement accounts. This leads me to believe that paying down the mortgage is the right move at this time. We both really like the idea of being mortgage free and have no plans to move from this house. Does paying down the mortgage seem like the best use of that “extra” $500 per month?
Her 401(k) target date fund at American Century with the 0.96% expense ratio seems very expensive to me. Can anyone point me towards a fund (or tool to find a fund) at American Century that has a more reasonable expense ratio? She was automatically enrolled in this fund when she started employment, and this is the first time I ever looked at the expense ratio…
I’ve had a 100% domestic stock AA since I began saving for retirement at the age of 25. I understand that I’ll need to begin to add bonds at some point, but I’m not sure when to begin that. I don’t currently have any trouble sleeping at night, but I’ve enjoyed good returns for the last several years (and understand that won’t last forever). When is it an appropriate time to begin adding bonds?
The intention is for any additional increases in salaries to go towards 401(k) contributions. We are trying to avoid lifestyle creep. I drive a 2000 Honda Civic and she drives a 2013 Subaru Forester. Both of which were paid for with cash and we intend to drive until it's no longer reasonable to do so. However, we are thinking of starting a family so the situation may change quite a bit over the next year.
Noah
Statistics: Posted by '93PA — Sun Sep 29, 2024 4:41 pm — Replies 3 — Views 201