What else to do for retirement? (25M)

[exitworldwide]

Hi!

I was wondering what other ways to maximize retirement or even what else to do at this point. I have looked through the flowchart and I checked a lot of the boxes. (No plans to buy house in the near future, maybe a M.B.A at some point but the goal is an in-state school, 0 plans to retire early will be working till 65.)

Quick background: Investment Banker

- Salary: $180K a year with 50% bonus of base salary minimum guaranteed. (Monthly Spending with Fixed & Variable cost totals to $4.3K; I believe I could cut this down if I lived further away but due to work I'd prefer to live close to the office)

- Area: MCOL area

See below for Assets / Liabilities breakdown:

Assets -

Cash:

- Checking Account: $6K (Excess Cash Flow Sweep to savings at the end of the month then placed into retirement accounts when bonus is paid out)

- High Yield Savings Account: $16.5K

Marketable Securities:

- Simple IRA / Rollover IRA: ~$68.2K (Located in FFSFX & AAOTX) contributions since 2017 (now maxing yearly)

- ROTH IRA: ~$36.2K (Located in FFSFX) Contributions since 2017 probably will not be able to contribute anymore unless I back door?

- Brokerage: ~$38.7K (Located in FFSFX & FDEEX) Contributions since 2022

- HSA: $1.2K from prior health insurance don't quality to contribute anymore

PP&E:

- Ford Bronco: ~$22.4K estimating depreciation at 4.5% Y-o-Y

Liabilities -

- $5.2K Student Loans (4.2% Interest Rate - paying minimum till maturity: 9.5 years remaining)

- $19.4K Ford Bronco: (2.1% Interest Rate - paying minimum till maturity: 4 years remaining)

 

[ricky777]

@exitworldwide Is it typical for a fresh out of school analyst to be pulling a qtr mil comp without an mba? Your retirement plan looks great especially since you’re not looking to retire early.

 

[exitworldwide]

@ricky777 Not really but I did 2 years in a Leverage Finance group post undergrad and then switched to Energy coverage. Now in my second year in energy. 4 years of experience post undergrad.

Thank you, maybe I stress out to much about personal finance and money but I just want to make sure I'm ok later on!

 

[ricky777]

@exitworldwide I didn’t start saving for retirement til I was almost 30 and am still on track for what I need to retire at a normal age. If I were you I’d look at some non-retirement investments or pick up some expensive hobbies.

 

[exitworldwide]

@ricky777 Thank you! And I bet you're doing great also!

I'm not much of a spender in general. I spend hours just second guess any non-essential purchase over $50 dollars or I'll let it sit in my amazon basket for weeks until I decide I really want it or just remove it.

 

[marlond]

@exitworldwide Here’s a wrench in your plans - how many people in IB do you know working at age 65? Best to have a back-up plan - instead plan on age 50. That way if for any reason you find yourself out of a job for any reason you can relax. Liquidity gives you options and opportunities.

 

[exitworldwide]

@marlond Definitely that is also true. I do have other opportunities in the horizon outside of IB such as PE, Hedge Fund, going over to corporate development later on. I'm kinda just stuck in this mentality if I grind through my 20s non stop I can be at least in a decent place for later on!

 

[ron103]

@exitworldwide Buddy I'm 26 and have 6k don't worry you'll be fine

 

[exitworldwide]

@ron103 Thank you! And you're doing well too!

 

[xenogearz]

@exitworldwide Incredible. Just pay off the student loan. I mean… come on. Again, big congrats to you.

 

[exitworldwide]

@xenogearz Thank you! I just see that the rate on my savings is higher than the student loans so there was no point. Also the student loans are the longest credit account I have. So having it out 10 years plus the 7 when it closes would be better than closing the account now plus 7 years.

 

[snowgirl14]

@exitworldwide I think backdoor Roth will be hard with your traditional ira balance, look up pro rata rules.

Do you not have a 401k with your employer?

 

[exitworldwide]

@snowgirl14 No 401K but substituted with a Simple IRA as the firm is smaller and has match. Max contributions of $16K a year compared to the $23K you would get in a 401K max.

 

[pondsbb]

@exitworldwide Go see an expert it will pay off for you! I would make sure they have a CFP and that they are fee only (means they don’t sell you products like insurance etc)

 

[peabody4242]

@exitworldwide What is your job ? Invest most of it in XEQT and buy a small rental property where you can live.Real estate will always be a good investment in the long term. You’ll be able to retire in your 40 with this salary and theses investments..

 

[exitworldwide]

@peabody4242 2nd year Energy Investment Banking Analyst

Thank you! I'll look into XEQT. I'm not a big real estate person as I truly just don't want to be landlord or anything.

 

[marlond]

@exitworldwide Taxable brokerage account, broad market equity indexes. Don’t time the market, just keep buying.

 

[exitworldwide]

@marlond Thank you! Will do!