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Looking to save 25% of gross income. Guidance?

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  • Avatar smiles123 
    Participant
    Status: Dentist
    Posts: 2
    Joined: 06/12/2019
    Earnest refinancing bonus

    First time poster wanting to make sure I’m moving in the right direction for retirement planning and investing. Military dentist, married filing jointly. Spouse not currently working. I project our total income for 2019 to be approx. $157,805.

    Looking to invest 25% of gross income for retirement…..$39,450 for 2019.

    Currently have Roth TSP at $19,000 and spouse IRA at $6,000.

    Can I open a personal IRA through Vanguard to contribute an additional $6,000 (in addition to my TSP)?

    Where should I contribute the remaining $8,450? A Vanguard taxable acct?

    Thanks for your input! Learning as I go.

     

    #221360 Reply
    jfoxcpacfp jfoxcpacfp 
    Moderator
    Status: Financial Advisor, Accountant, Small Business Owner
    Posts: 7503
    Joined: 01/09/2016
    Can I open a personal IRA through Vanguard to contribute an additional $6,000 (in addition to my TSP)?

    Click to expand…

    Yes, that is correct. And, yes, contribute the remaining $8,450 to a taxable account with your brokerage of choice. This is a very simplified answer that assumes you have taken care of other goals, have adequate term and LTDI, e-fund, etc.

    I applaud your ambitious savings goal and also thank you for your service!

    Johanna Fox Turner, CPA, CFP, Fox Wealth Mgmt & Fox CPAs ~ 270-247-0555
    https://fox-cpas.com/for-doctors-only/

    #221389 Reply
    ENT Doc ENT Doc 
    Participant
    Status: Physician
    Posts: 3158
    Joined: 01/14/2017

    What is the spouse IRA at $6k? Your planned IRA for her? I would set up TIRAs for you both as well as Roth IRAs. Backdoor Roth for you both each year for $12k. Rest in taxable.

    #221393 Reply
    Liked by Peds
    Faithful Steward Faithful Steward 
    Participant
    Status: Financial Advisor, Small Business Owner
    Posts: 399
    Joined: 06/12/2017

    Currently have Roth TSP at $19,000 and spouse IRA at $6,000.

    Click to expand…

    Is spouse IRA a Roth or Traditional? Given your relatively low tax bracket, you might want to consider Roth.

    Can I open a personal IRA through Vanguard to contribute an additional $6,000 (in addition to my TSP)?

    Click to expand…

    Yes. Again, I’d recommend Roth.

    Where should I contribute the remaining $8,450? A Vanguard taxable acct?

    Click to expand…

    Yes, if you don’t have kids. If you have kids, I’d suggest starting to fund 529 Plans.

    Keep up the great work! You’re killing it!

    Michael Peterson, CFP® | Faithful Steward Wealth Advisors
    http://www.fswealthadvisors.com | (717) 496-0900

    #221410 Reply
    Avatar smiles123 
    Participant
    Status: Dentist
    Posts: 2
    Joined: 06/12/2019

    Thank you!

     

    Yes, $6k for spouse IRA is in a Roth.

    #221590 Reply
    Hank Hank 
    Moderator
    Status: Attorney
    Posts: 1225
    Joined: 03/27/2017

    TSP, Roth IRA, spousal Roth IRA, taxable.
    When you’re deployed, Savings Deposit Program then excess non-taxable contributions to TSP to max out $56K limit.

    #222149 Reply
    Liked by SLC OB

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