retirement accounts

[Splenda88]

230k max?
For the down payment?

For the whole house. I am in a small city in the southeast. Major international airport is 1H45mins away. Homes are not expensive here.

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[Splenda88]

Damn. I spent $300k on renovations alone.

I’m in Florida. Nothing cheaper than 1 million in my neighborhood and Florida used to be cheap to live.

considering the poster age. They are 34/35 years old and no kids or young kids and living in very low cost of living area where homes are 300k or less. Good for them. My living expenses when I was young attending was 6k a month food housing cars vacation etc making 400k and up.

Now my living expenses is like 20k a month making 450k a year. The 2 kids cost me 5k-6k a month between feeding them activities 529 plans

South FL is insane. I have a 3BR/2BA investment property in palm beach county that I purchased in 2011 for 150k; now worth 500k.

 

[aneftp]

South FL is insane. I have a 3BR/2BA investment property in palm beach county that I purchased in 2011 for 150k; now worth 500k.

2011/2012 was bottom of the real estate market. Prices remain pretty stable from 2013-2020.

The true market prices for a distressed 150k property purchased 2011 was likely 20% higher.

The 2007 price of that investment property was likely 400k that was probably sold for 150k.

 

[ERRES2288]

Damn. I spent $300k on renovations alone.

I’m in Florida. Nothing cheaper than 1 million in my neighborhood and Florida used to be cheap to live.

considering the poster age. They are 34/35 years old and no kids or young kids and living in very low cost of living area where homes are 300k or less. Good for them. My living expenses when I was young attending was 6k a month food housing cars vacation etc making 400k and up.

Now my living expenses is like 20k a month making 450k a year. The 2 kids cost me 5k-6k a month between feeding them activities 529 plans

All that early savings was huge for you I’m sure. What is your net worth now? My wife is on board and we are trying to save as much early so can let the portfolio do heavy lifting. But I’ve made some mistakes, bought 120k car, expensive furniture, etc.

 

[OTCAwesome]

We have a spending plan for the first few years out of training, but in general my wife buys lots of little stuff (I mean LOTS) and I am the one more likely to spend for big things. Top planned purchases I am saving for is a nice trampoline. ACON Air 16 Sport HD Performance Rectangular Trampoline with Net and Ladder

Bro, my kids are def going to have to come over and use that. The wifey currently does not want us to have a trampoline....yet

 

[GassYous]

All that early savings was huge for you I’m sure. What is your net worth now? My wife is on board and we are trying to save as much early so can let the portfolio do heavy lifting. But I’ve made some mistakes, bought 120k car, expensive furniture, etc.

Life is short, better to spend it now when you can enjoy it

 

[coffeebythelake]

Air travel to Utah alone for me and family was $3200 this spring. That’s coach and not first. I’m

Ski lift tickets were $1000 each person ($4000)

Hotel was $900/night.

6 nights.

$12500. BEFORE food and entertainment

So a ski trip for a family of 4 is easily 15k for peak spring break season.

I wouldn’t even call it luxury travel either.

That’s one family trip.

Add summer travel 20-30k

That’s 40k a year in vacation.

We do side trips since we live in flordia. Like 3-4 day cruises as well and extended 3 day weekend vacation.

I’m just gonna to work more this weekend and make another 4-6k lol. No overnight for me. Can make more but I like to sleep in my own bed.

Thats crazy expensive. I'd rather travel to Europe with my kids, and it would still cost 1/2 of that.

We travel 5 to 6 times a year and spend about $40k on vacations in total.

 

[NITRAS]

Anyone who mentions back door Roth likely finished residency after 2010.

Pro rata rules make it more complicated for those who had hundreds of thousands in pretax accounts in sep ira prior to that. There was a one year mega Roth conversion in 2010 that allowed for taxes to be paid over 2 years. This is even more complicate for pre martial accounts you don’t want to co mingle after getting married with any currently 401k that started after getting married.

There is a reason I rolled EVERYTHING into ROTH. Once really expensive year when I rolled something like $150k into ROTH from my employer match and my wife’s 403b when she quit her job. I’ll be really happy in a couple decades.

 

[Dr. Rude]

There is a reason I rolled EVERYTHING into ROTH. Once really expensive year when I rolled something like $150k into ROTH from my employer match and my wife’s 403b when she quit her job. I’ll be really happy in a couple decades.

Depends on your tax bracket the year of conversion as compared to the tax bracket that you are in during withdrawal phase. Assuming the rules don’t change.

 

[Angus Avagadro]

There is a reason I rolled EVERYTHING into ROTH. Once really expensive year when I rolled something like $150k into ROTH from my employer match and my wife’s 403b when she quit her job. I’ll be really happy in a couple decades.

My cpa tax attorney advised against this. We don't know if they will change the laws in the future. I unrstand why people are considering this as taxes at the moment are rather low compared to historical tax rates.I have heard Nancy Pelosi talk about adding a one time surcharge on All retirement accounts. It makes our representatives crazy, looking at all that money they don't control. If done properly, taxes on these monies can skip a couple generations. At least that is what I have been advised.

 

[GassYous]

Air travel to Utah alone for me and family was $3200 this spring. That’s coach and not first. I’m

Ski lift tickets were $1000 each person ($4000)

Hotel was $900/night.

6 nights.

$12500. BEFORE food and entertainment

So a ski trip for a family of 4 is easily 15k for peak spring break season.

I wouldn’t even call it luxury travel either.

That’s one family trip.

Add summer travel 20-30k

That’s 40k a year in vacation.

We do side trips since we live in flordia. Like 3-4 day cruises as well and extended 3 day weekend vacation.

I’m just gonna to work more this weekend and make another 4-6k lol. No overnight for me. Can make more but I like to sleep in my own bed.

I just went to Paris for under 700/person. Hotel was 300/night in the middle of the city.

Skiing in Tahoe, the room was like 200/night. I think you're doing something wrong.

 

[HemeOncHopeful19]

I just went to Paris for under 700/person. Hotel was 300/night in the middle of the city.

Skiing in Tahoe, the room was like 200/night. I think you're doing something wrong.

What did you take to Paris, a rowboat? Or is this gonna be one of those “I used credit card points instead of a cash back card so it doesn’t count” type of thing

 

[Iso4ane]

There is a reason I rolled EVERYTHING into ROTH. Once really expensive year when I rolled something like $150k into ROTH from my employer match and my wife’s 403b when she quit her job. I’ll be really happy in a couple decades.

I did something similar last year (during the 'dip' hopefully) and the tax bill hurt initially, but hopefully will be happy in a few decades. Although I don't like paying taxes, lets be real, the tax rate is probably going up.

 

[aneftp]

I just went to Paris for under 700/person. Hotel was 300/night in the middle of the city.

Skiing in Tahoe, the room was like 200/night. I think you're doing something wrong

I just went to Paris for under 700/person. Hotel was 300/night in the middle of the city.

Skiing in Tahoe, the room was like 200/night. I think you're doing something wrong.

Spring break (march 13-17) in park city this year was extremely expensive.

Like any peak dates (think week after Xmas at Disney or ski resorts or cruises). You will pay an arm and less.

Not doing any thing wrong. Add to you either pay for 2 hotel rooms or get a 1 bedroom or even 2 bedroom suite as kids get older.

It’s all about perspective with how much one pays for vacation and what time of year you go.

Just like right now. People in Florida took their kids out of school a couple of days early before Memorial Day either to fly to Europe for vacation since it’s slightly cheaper and get more expensive as summer really begins. Same with Alaska cruises the price is much cheaper last week. And gets more expensive as all the kids are off for summer break all throughout the country.

I am a master world traveler. I can be cheap. I can also drop a ton of money. But options are limited when traveling with family and kids in school.

 

[anbuitachi]

holy Jesus Christ where did you guys meet your wives that these are the kind of life lessons you learned

From my experience, multiple reasons why this occurs, one reason is if wife makes way less than you, and you make lets say 500k, she thinks we are 'rich', when i think we are not, bc all my colleagues make that much, and their households are way richer than mine since my wife doesnt make much. Many dual physician or dual high income earner households in my circle.

however in her eyes, all of a sudden she has so much more money to spend compared to when she was single... so her spending increases. its like 'free money' given to her, thru work of someone else

i imagine if i married someone who makes 5m, id feel similar and spend way more. who knows, maybe shed think im a big spender

 

[nimbus]

Never seen or care to see a superfake in real life but they are reportedly very good. Even authenticators from resale sites have trouble telling them apart.

How Counterfeiters Got Shockingly Good at Knocking Off Designer Handbags

The knock-offs are nearly indiscernible nowadays. Here's how can tell them apart.

robbreport.com

 

[pgg]

Never seen or care to see a superfake in real life but they are reportedly very good. Even authenticators from resale sites have trouble telling them apart.

How Counterfeiters Got Shockingly Good at Knocking Off Designer Handbags

The knock-offs are nearly indiscernible nowadays. Here's how can tell them apart.

robbreport.com

It makes me think of synthetic gemstones. Objectively as good as, or better than, real diamonds or other gems. Far less expensive. No moral baggage like De Beers manipulating the market, or open pit mines in Africa fueled by suffering and run by machete-wielding overseers. But people still value the "real" thing. Maybe they value the human pain required to get a real rock on a finger.

A real $10,000 purse instead of the indistinguishably similar $100 purse? All I can really bring myself to feel here is a bit of sad contempt for the person who pays $10,000 for whatever superficial feeling they get from conspicuous overspending.

 

[anbuitachi]

It makes me think of synthetic gemstones. Objectively as good as, or better than, real diamonds or other gems. Far less expensive. No moral baggage like De Beers manipulating the market, or open pit mines in Africa fueled by suffering and run by machete-wielding overseers. But people still value the "real" thing. Maybe they value the human pain required to get a real rock on a finger.

A real $10,000 purse instead of the indistinguishably similar $100 purse? All I can really bring myself to feel here is a bit of sad contempt for the person who pays $10,000 for whatever superficial feeling they get from conspicuous overspending.

my wife said she would never use lab diamonds. even though i mentioned you cant tell the difference and way cheaper and no blood diamonds and i heard pandora is aiming to switch their entire line to lab diamonds. but she thinks they are 'fake'. at the same time sometimes she is impressed by other peoples diamonds, but she has no idea if they are lab or not bc you cant tell with naked eye. shes often like 'wow such a large diamond!', and i respond with, if i spent the same amount on a lab diamond as i spent on your tiffany diamond, you could have a even larger diamond!

 

[periopdoc]

Are you guys actually maxing out retirement accounts straight out of residency/fellowships (e.g 60-70k/year)? It seems like a huge sum of money to put to the side untouched for 30 years lol

I contribute my personal max of 30k plus my corporate max of 43.5k through my primary job, plus an additional 43.5k corporate contribution from my locums company.

Been doing this since I finished fellowship. Things like Covid have prevented me from making enough with my locums gig to max out that contribution every year.

 

[Greenbayslacker]

my wife said she would never use lab diamonds. even though i mentioned you cant tell the difference and way cheaper and no blood diamonds and i heard pandora is aiming to switch their entire line to lab diamonds. but she thinks they are 'fake'. at the same time sometimes she is impressed by other peoples diamonds, but she has no idea if they are lab or not bc you cant tell with naked eye. shes often like 'wow such a large diamond!', and i respond with, if i spent the same amount on a lab diamond as i spent on your tiffany diamond, you could have a even larger diamond!

Just don’t tell her. Or get a dummy GIA certificate.

 

[finalpsychyear]

I contribute my personal max of 30k plus my corporate max of 43.5k through my primary job, plus an additional 43.5k corporate contribution from my locums company.

Been doing this since I finished fellowship. Things like Covid have prevented me from making enough with my locums gig to max out that contribution every year.

I'm pretty sure for someone 50 and over the total contribution from employer and employee in all 401k related accounts cannot exceeed 73k for 2023. Unless you have a cash balance which you are counting. I had a friend who got audited for his 401k deduction and had to pay back everything for 5-7 years of over contributing. Please check the link below.

Retirement topics: 401(k) and profit-sharing plan contribution limits | Internal Revenue Service

Learn the contribution limits for your 401(k) and Profit-Sharing retirement plans.

www.irs.gov

About halfway down titled overall limit of contributions. Hopefully you found a loophole but just be double sure.

 

[abolt18]

I'm pretty sure for someone 50 and over the total contribution from employer and employee in all 401k related accounts cannot exceeed 73k for 2023. Unless you have a cash balance which you are counting. I had a friend who got audited for his 401k deduction and had to pay back everything for 5-7 years of over contributing. Please check the link below.

Retirement topics: 401(k) and profit-sharing plan contribution limits | Internal Revenue Service

Learn the contribution limits for your 401(k) and Profit-Sharing retirement plans.

www.irs.gov

About halfway down titled overall limit of contributions. Hopefully you found a loophole but just be double sure.

Can You Have More Than One 401(k)? Yes, Here's How! | White Coat Investor

Guess what? You can have multiple 401(k) accounts, saving you thousands in additional taxes every year. But it gets pretty complicated. Here are the rules.

www.whitecoatinvestor.com

 

[periopdoc]

I'm pretty sure for someone 50 and over the total contribution from employer and employee in all 401k related accounts cannot exceeed 73k for 2023. Unless you have a cash balance which you are counting. I had a friend who got audited for his 401k deduction and had to pay back everything for 5-7 years of over contributing. Please check the link below.

Retirement topics: 401(k) and profit-sharing plan contribution limits | Internal Revenue Service

Learn the contribution limits for your 401(k) and Profit-Sharing retirement plans.

www.irs.gov

About halfway down titled overall limit of contributions. Hopefully you found a loophole but just be double sure.

Each individual can only contribute up to a combined maximum of $22,500 ($30,000 if over 50) to all of his 401ks, no matter how many 401ks he participates in.

However, the corporate sponsor for every plan in which he is enrolled can contribute up to $43,500, and there is no limit to the number of different sponsors/ 401ks that he can participate in.

Corporate contribution cannot exceed 100% of his compensation, so he has to earn at least $43,500 with each corporation.

There are also rules regarding highly compensated employees and key employees to prevent top heavy plans. I won't go into those here, but I spend a lot of time with our corporate accountants making sure my primary business is in compliance.

It is critical that your locums business has zero relationship with your primary employment, if you select this strategy.

 

[aneftp]

It makes me think of synthetic gemstones. Objectively as good as, or better than, real diamonds or other gems. Far less expensive. No moral baggage like De Beers manipulating the market, or open pit mines in Africa fueled by suffering and run by machete-wielding overseers. But people still value the "real" thing. Maybe they value the human pain required to get a real rock on a finger.

A real $10,000 purse instead of the indistinguishably similar $100 purse? All I can really bring myself to feel here is a bit of sad contempt for the person who pays $10,000 for whatever superficial feeling they get from conspicuous overspending.

Yes and no. Some people are ok driving older Honda even though they have plenty of money. This super rich CRNA friend of mine has 3 waterfront homes in the keys. Multiple homes in Destin area. But he drives almost a 30 year old
Honda. His main home is actually a 600k RV (major tax write off if you know where to register it) but resell values tanked for a while.

So he frowns on someone with expensive depreciating asset like a luxury car.

To each their own if they want to buy expensive items. If they can afford it. Let them be.

 

[NITRAS]

Yes and no. Some people are ok driving older Honda even though they have plenty of money. This super rich CRNA friend of mine has 3 waterfront homes in the keys. Multiple homes in Destin area. But he drives almost a 30 year old
Honda. His main home is actually a 600k RV (major tax write off if you know where to register it) but resell values tanked for a while.

So he frowns on someone with expensive depreciating asset like a luxury car.

To each their own if they want to buy expensive items. If they can afford it. Let them be.

He frowns on others for depreciating assets and has a $600k RV?

 

[aneftp]

He frowns on others for depreciating assets and has a $600k RV?

That’s why I said the RV is a tricky thing. Years past. RVs homeowners would use it a major tax deduction. Resell every 3 years and basically lose nothing on it. I know almost every single tax code loophole. But resell values of RVs have tanked the last 10 plus years vs the previous scheme of owning for 3 years and reselling

 

[Modoc]

so the consensus is to max out retirement accounts! thanks y'all, very insightful thread into various aspects of upcoming expenses and lifestyle changes.

 

[ProPropofol]

Haven't read all the comments in this thread so I apologize if this has already been mentioned. I just thought I would put a plug for some books that were very helpful for me for retirement planning that would be useful for a new grad.

"A Random Walk Down Wall Street" by Burton Malkiel.

• Helped establish a good foundation for efficient mark hypothesis
• Explained the principles behind what you should look for in investments
• A long read but an easy read with historical context which I thought was interesting
• Looks at the performance of different types of funds over time and points out their important elements which made them successful investment choices

"The Four Pillars of Investing" by WIlliam Bernstein

• Written by a neurologist so I felt like I had that physician-physician connection
• Helps re-enforce the principles of "A Random Walk Down Wall Street"
• A shorter read but still also an easy one
• Mentions a lot of specific funds to give you a starting place
• Also goes into investments outside of 401k and IRA once you have maxed out those utilities

TLDR: Index funds good, low expense ratios good, once max out 401k and IRA ---> go for tax efficient vehicles. Compound interest is extremely powerful. These books teach that.

There is also the Bogleheads forum which has been helpful to read other people's stories through financial planning. Makes you appreciate how fortunate we are compared to the rest of the nation at times!

 

[abolt18]

Haven't read all the comments in this thread so I apologize if this has already been mentioned. I just thought I would put a plug for some books that were very helpful for me for retirement planning that would be useful for a new grad.

"A Random Walk Down Wall Street" by Burton Malkiel.

• Helped establish a good foundation for efficient mark hypothesis
• Explained the principles behind what you should look for in investments
• A long read but an easy read with historical context which I thought was interesting
• Looks at the performance of different types of funds over time and points out their important elements which made them successful investment choices

"The Four Pillars of Investing" by WIlliam Bernstein

• Written by a neurologist so I felt like I had that physician-physician connection
• Helps re-enforce the principles of "A Random Walk Down Wall Street"
• A shorter read but still also an easy one
• Mentions a lot of specific funds to give you a starting place
• Also goes into investments outside of 401k and IRA once you have maxed out those utilities

TLDR: Index funds good, low expense ratios good, once max out 401k and IRA ---> go for tax efficient vehicles. Compound interest is extremely powerful. These books teach that.

There is also the Bogleheads forum which has been helpful to read other people's stories through financial planning. Makes you appreciate how fortunate we are compared to the rest of the nation at times!

On that same note, an unbelievably easy read by Bill Bernstein is his short pamphlet "If You Can". Something like 18 pages. It's very good. And it's free (he made it that way on purpose)! The link below will download the PDF.

If You Can - ETF.com https://www.etf.com/docs/IfYouCan.pdf

 

[Arch Guillotti]

so the consensus is to max out retirement accounts! thanks y'all, very insightful thread into various aspects of upcoming expenses and lifestyle changes.

Depends on what you consider to “max” out things and what is available to you? Some of us like to have some play money to put in taxable accounts.

 

[jjm285]

Are you guys actually maxing out retirement accounts straight out of residency/fellowships (e.g 60-70k/year)? It seems like a huge sum of money to put to the side untouched for 30 years lol

I’m 3 years out of training. Been maxing 401k, back door Roth x2, HSA and not spending the funds since I started. Starting to put 30k/year in defined benefit plan.

Married, 3 kids, spouse stays at home. I feel like we still live a pretty good life despite a ton of money going to retirement and student loans.

 

[Status Sciaticus]

I tried marrying a pretty doctor, still had to shell out for floor seats to Taylor Swift

how much were those floor seats? Apparently Taylor Swift is raking in $13,000,000 per concert on her tour....

 

[HemeOncHopeful19]

how much were those floor seats? Apparently Taylor Swift is raking in $13,000,000 per concert on her tour....

Well I was about to type out "honestly I can't complain she got them for face value" but then I asked her to remind me and she said $450 before fees

 

[patriot6]