Advice for Maximizing Financial Position

Google
BDRR20

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BDRR20
Jan 30 8 Comments

TC: 450k (sharp jump from ~300k last year)
YOE: 5
NW: ~530k
Location: Chicago

Currently have the following saved:

Roth 401k / Roth IRA: ~200k
Traditional 401k: ~130k
HSA: ~10k
529: ~6k
Brokerage Account: 110k
Cash: 75k (working on DCAing this into the market down to 50k)-
My yearly expenses are ~100k a year (most of this going towards travel)

I’m maxing all my tax advantage accounts each year (401k, backdoor Roth, Megabackdoor Roth, HSA) and then contributing ~1.5k this year to a 529 and the rest to a brokerage account (estimated ~130k this year). My overall asset breakdown is 60% VTI, 30% VEU, 10% VNQ/VNQI/VTEB/GLD.

My partner (likely to get engaged this year or next) makes ~100k and has <25k savings as this point.

How should I go about maximizing my savings here?

- I don’t plan on having kids until mid 30s (currently 27), but would frontloading more in the 529 make sense so I can rely more on compounding returns to fund kids college? A little worried that I’ll over contribute, especially if kids don’t go to college or college becomes government subsidized.

- I’m not sure I’ll want to settle down in Chicago long-term, so I’m not sure buying a house/condo here makes sense. But perhaps a rental property makes sense? My only concern here is relatively little of my money is liquid (not in retirement accounts) at the moment so a 50k+ down payment feels like overextending.

- Is 100k of yearly expenses reckless? I want to enjoy my 20s/30s as much as possible, but I feel like I might be overextending based on seeing how low some people’s budgets are on this app.

- is my asset allocation too conservative? On one hand I’m starting young enough and from a strong enough base that taking big risks doesn’t seem worth it since I’ll get where I want to go eventually, but on the other hand I have a safety net.

Very curious to hear thoughts on what you would do in my situation. Any better ways to invest that I’m missing? I know I’m doing well, but for some reason I feel uneasy (maybe it is just too much time on this app, haha)

#investments #personalfinance

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 TOP 8 Comments
  • New
    accel6

    New

    accel6
    Wow your TC is great. I am a huge fan of rental properties, I started 12 years ago and now have grown to multi-million in net worth as well as strong cash flow over $100k per year.

    Single income family with multiple kids allows us to really enjoy life and spend time raising our family.

    YOE 20
    Age 40
    TC - was around $200k for last 5 years. Prior to that hovered around $100k. Starting next month hopefully $400k thanks to this site and trying a new gig at a fang.

    Plan is to retire in 5 years and live off investments, pay off mortgages, travel.

    Also very important to us we give a lot each year to charity. $30k for last year.
    Jan 30 3
    • New
      accel6

      New

      accel6
      I live in rural NY and NJ area which is where I focused my efforts so I would be close by. However, some folks are just as successful investing in other cities and hiring a good property manager.

      People always need a place to live. Many people in the US are unable to afford down money for a home.

      A few tips:
      1. Always work toward 100% occupancy, put auto renew in the lease and if they give notice find a replacement while it’s occupied.

      2. Multi unit buildings have given me better cash flow and scale. They are equal in effort to owning a single family home IMO.
      Jan 31
    • Which areas count as rural NJ/NY where you can actually find renters?
      Feb 4
  • Amazon
    Fintechyyy

    Go to company page Amazon

    Fintechyyy
    GTFO of Chicago. Home values there are stuck in perpetuity due to outrageous property taxes.
    Make sure youre making contributions towards Traditional 401k since your retirement will likely have a lower tax bracket. Stop funding 529 till you actually have the kid. Put that towards rental units in TX or FL. Chicago has awful landlord laws. Get a prenup.
    Jan 30 1
    • Google
      BDRR20

      Go to company page Google

      BDRR20
      OP
      Any particular reason to wait on the 529? Agree Chicago is a bit of a mess, as a renter it doesn’t feel too bad since the COL is low and state tax isn’t outrageous (4.9% I think). Any advice for getting started with rentals out of state?
      Jan 30
  • Google
    low TC

    Go to company page Google

    low TC
    Are you getting 450k at Google Chicago, or did you move to a trading firm?
    Jan 31 0
  • New
    Donald Gaf

    New

    Donald Gaf
    Whether you're saving for retirement or seeking wealth through the magic of compound growth the secret is really just a simple three-step plan
    1) Earn a decent living and live beneath your means. 2) invest that difference automatically and increase the investment with each raise. 3). Invest in a way that takes advantage of your tax.
    Institutional investment with crypto with the aid of an investment advisor is great source of passive income.
    It's rear but profitable in a long.
    I love that feeling when i earn 30%-50% of your investment on a monthly basis.
    Jan 30 0