Guidance requested

[caranxruber]

Good morning, first time poster long time reader.
Been reading about retirement and age stuff saying at xx age you should have xxx% in retirement and am starting to worry about my financial help.
About me:

32 y/o 2 children and a wife working as an FSE in a HCOLA
W2 96k
Other income 30k non taxed
Non-retirement brokerage just under 9k
Retirement(401k) 21k
CD’S @ 4.45-4.88%- 45k
Wife makes less than 30k w2.

Expenses monthly
Mortgage 2k
Utilities- roughly 600 -800 for electric and gas
Phone- 200
Daughter tuition(ends in march wont be going private next year) 715
Car insurance- 120
Trash pick up- 85
Streaming services- 200
Any other expenses are covered by my wife I.e groceries cat food etc.

Basically save every penny I can after monthly expenses. Roughly 2800 a month.

My W2 is set to minimum contributions to get employer match.

I’ve never been good with money, come from generational(not poverty poverty but like declared my one parent declared bankruptcy and we were constantly in collections while the other was non-existent) not smart with money-ness/poorness. We had water and food. But never had anyone teach me about financial health or anything outside the military, and let’s be real little e3 me was spending money like there was no tomorrow haha.

I’m not sure what I should be focusing in on, I’m also not sure if I’m financially okay. According to the internet I’m fucked.

I wanted to save money, stay as liquid as possible in case the real estate market pulls back. Should I be focusing on my retirement? Am I saving too little? Too much? Is real estate realistic given my income? Am I financially healthy? WWYD in my situation?

 

[lanman87]

@caranxruber I’ve read that you want to have a 3-6 month liquid emergency fund. If you don’t have that start with that. Then move to upping your retirement.

In certain circumstances that would be getting the match on 401k (which you do) then moving to IRA and when you max that go back to 401k. Others max 401k then move to IRA. I do not know the difference or benefits of either strategy. So that’s something to ask someone.

I understand the stress and confusion of coming from a generationally poor environment. A couple of years ago when we started making more money I had to google “what to do with extra money”. Which is a situation I never thought I’d find myself in.

I’ve heard that like 1/3 of millionaires are people with “normal” paying jobs. So I think you can set yourself up for retirement and be financially okay. I don’t think 32 is too late.

 

[kollajakton]

@caranxruber Firstly, thank you for your military service.

Highly recommend you get a copy of JL Collins "Simple Path to Wealth".

Imo, your first priority should be an emergency fund parked in a High Yield Savings Account to take advantage of the current interest rates. I have 2. One with Ally and the other at Discover. Take advantage of promo codes if you go with Ally. You need 6 months of living expenses.

 

[axelminecraft2014]

@kollajakton Good choice on JL. He really opened my mind on his FU money and the power it gives.

 

[caranxruber]

@kollajakton I will look into that book! And really no need to thank me. I did nothing, there are plenty of men and women who have served that deserve appreciation, I’m not one. But thank you for acknowledgingz