What is your expected income in retirement? Generalizing, but yes, at 12% you should be doing Roth.

In theory, we should have our mortgage paid off by then. We have no plans to move and love our house. I would say 2k/month would allow us to live quite well but we could easily get away with less, barring any major catastrophes.

My husband and also has a pension and will likely retire from his job. I also have a pension but I'm not sure I will stay here long enough to benefit from it.

Husband is also eligible for retired employee rates for health insurance, so it will actually be pretty affordable if he/we decide to retire early (which is a goal of ours).

I don't think it's that obvious.

First of all, I'm old. Roth wasn't even invented until I'd been contributing to my 401k for 10 years. Then it took another 14 years before my employer decided to add Roth to my 401k.

73 + 37 = 110. 22%(73k) + 12k = 22,060. That's 20% of your combined income. General recommendation is 10-15%. 20% is steep, unless you're behind.

Fidelity recommends having 1x your (combined) salary saved for retirement by age 30. How close is your combined retirement account value to 110k?

I'm old, but not quite old enough to withdraw from my retirement accounts. Wifey is younger than me. So if I were to quit at 59 1/2, at least 3/4 of my retirement money will be in Traditional, only 1/4 in Roth. But.

For those years between retiring and RMDs, I can spend out of my Roth, and convert Traditional to Roth. That will lower my tax rate, allowing me to get money into Roth.

There are 2 good reasons to go Traditional, in my opinion:

1. you need the tax break to hit your savings goal. I don't think that applies to you.
2. Congress. You never know when Congress might get squirrelly and change the rules on you in a negative way. For all we know, some future Congress might disallow social security to anybody holding a Roth account. Or to anybody holding a Traditional account.

Don't think Congress can't ruin your plans? My parents-in-law planned to take money out of my FIL's workplace retirement account to pay for college. Before the eldest daughter graduated HS, Congress changed the rules and those withdrawals were no longer permitted. So I married a girl with Student Loans.

We are a little behind. We have approximately 70k in different retirement accounts between the two of us.

I think you are doing great. Maxing Roth is smart at 12% bracket. Taking advantage of 401K is good, too.

Just make sure you have a strong Energency Find so you don't need to tap that retirement money, and you both have life insurance.

Enjoy what sound like a great start to a secure life.

Yes! We have a 6 month emergency fund as well as a sinking fund for house repairs. Thank you!

In the 12% bracket the Roth is a great choice. It's costing you 12% in tax to make those contributions, but after tax free growth and withdrawals you will almost certainly come out ahead. When you get to the 22% or 24% bracket and above, the benefit is less clear, at least to me. I think in 24% bracket it can be better to make Traditional contributions plus invest an extra 24% taxable. Even though you'll pay tax on withdrawals, you'll end up with around 24% more savings, and that can pay for a lot of taxes in retirement.

I think you are doing just fine. Probably better than 95% of Americans are doing right now in your age group.

You are putting enough money away, I say live a little. Life is also meant to be enjoyed not just meant to be worried about your retirement.

You have 35 years for your money to grow. Assuming 8% growth on your husband's income you will have over 3,000,000

If you work for 40 years, the retirement nest egg will be over 4,000,000.

That is just your husband's 401K.

Throw in your Roths, you will be very comfortable.

Add in your husband's pension which is probably 34% of the final three year's average annual salary.

And you probably contribute to Social Security also.

Thank you! We do have some fun. :) most of our hobbies are low cost (fishing, hiking, etc). so we don't spend much on hobbies. I am planning a good trip for us next year though! Maybe the Keys or a trip to Coasta Rica.

I'm also aware that whenever a kid gets added to the mix that will cut into what we contribute, so I'm buffing up what I can before that happens.

Yes, most likely a Roth is a good way to go. That way no matter what happens in the future with your economic situation, the economy as a whole, tax rates, etc you know that what you see in the account is what you get to keep. If his employer matches his 401k contributions you already get a little bit of a hedge because the employer match will always go into the pre-tax (traditional) 401k account. So you are likely building up both pre-tax and Roth money.

It sounds like you have a good plan and are executing it well. My only advice is to check that your husbands 401k/457b does not have a roth option. If it does, you may want to take the tax hit at 12% to let that money grow tax free for retirement, in addition to the current Roth IRAs.

Some back of napkin math; Assumtions

• assumes a Roth 401k/457b is an option with husbands employer

• $0 starting point with your accounts

• Retire at age 67 (37 years of growth)

• 7% annual return

• using the income scenario you specified

• 4% withdrawl in retirement

If you can contribute the 22% 401k contribution into a roth it saves you from paying taxes on income from the 401k. At a 4% withdrawl (roughly 250k before taxes) you would pay 33k in taxes (22% bracket for married filing jointly) per year using the 2022 tax brackets from the 401k income. You would need to compare that to the taxes you would pay each year to do so, which is roughly $3,500 tax that you would pay on that income, which you currently do not pay because the 401k is pretax. You also have to consider if it afforable to absorb another $3,500 in annual taxes now to avoid paying them later. Of course the tax brackets will change in the future, and knowing if they will go up or down is anyones guess. I plan for higher taxses, and will be nicely surprised if they are the same or lower.

If you think 220k sound like a tremendous amount in retirement, it is a lot, but with 3% annuallized inflation it ammounts to roughly 65k in buying power as compared to the purchasing power of a dollar today. That 65k with a house paid off, and good planning should be more than enough replacement income for the income you have today. But it gives you a good idea where your trajectory is headed and how you can adjust through your earning years.

You are still in your 20s, already have a house, earn above 100k, and are contributing 20% to retirement? You're in amazingly good shape. And a pension? Wow. Time for babies.

Honestly, what you are doing already sounds really good. I think you're probably already planning better than most people.

Double check your emergency fund. You want to have enough in liquid assets (cash or bank savings account) to cover your family for 3-6 months if something drastic happened and income went to zero. If you already have that, disregard..

Past that - if you are already maxing roth and doing a good amount into 401(k) - can either of you contribute to an HSA? That might be the next best tax-advantaged account to max.

Past that, you max 401(k) and then start contributing to to a standard brokerage account. Sounds like you've already got a good handle on all this.

So my husband has the option for an HSA, but they aren't kidding when they say high deductible. Just him is 4k with an OOP max of 8k. I envy those whose "high deductible' plan is 1-1.5k.

I've gone back and forth with it, especially since it's his open enrollment. I love the idea of the HSA but I don't want something catastrophic to happen in the meantime (while building up tye HSA) and wipe us out.

Also, a baby would have to go on his insurance (mine is too expensive to add family members). I do not love the idea of an infant on an HDHP.

He does have a Roth option. However, we have that amount pretax so that we are in the 12% bracket. I have to keep an eye on my overtime and adjust his contributions accordingly.

Actively trying!