Posted this on the general board but it got derailed instantly. Cross posting here for actual answers. I always think I'm doing well until I hear about other folks, so I'm actually curious about age/marital status/dual income/net worth. Below are my stats.

27 yo and wife is 23 yo (both working. No kids)
Household income 175k-200k
Percentage of gross income saved is currently 37-40%
Net worth of 200k

Wife wants to become a stay at home mom soon, so that will make things much tougher. Life is expensive. Will probably drop to 25% of gross income saved at that point with 15% being tied up in 401k. So only 10% saved for outside investing.

Rule #1 compliant

https://media.xogrp.com/images/1db98148-cd19-4982-a9ff-f71a9d6c6cc1

Break down your savings. 401k, Roth, taxable brokerage, etc

Look into setting up YNAB (You Need A Budget) and see where you are actually spending your money. Maybe it will help open your eyes to consumer purchasing that are wants and not needs.

Yeah, OP, I'd say you're doing pretty good. But I'd also say that you shouldn't compare yourself to anyone else and just do you.

Wife and I are early 40s with 3 teenagers (2 HS, 1 MS). Wife stayed home with the kids from the time the twins arrived until the youngest started school. It's tougher on 1 income but very doable, especially if you keep your housing costs reasonable (little harder in the current market).

We're currently grossing about 200k a year, both in jobs with limited hours (wife's a school nurse and I work roughly 40hrs / week on a 4/10 schedule) - we could each make significantly more, but it's not worth the sacrifice and time away from the kids. We save around 35-40% of our gross income and have a net worth around $1.3M. Goal is to be able to retire in the next 15 years (not sure if we'll actually retire that soon, but want the ability to by that point).

OP, you're doing a great job. I'd suggest building up a good rainy day fund ahead of the arrival of kids and be sure to do some traveling before they arrive - it gets significantly harder to travel once kids enter the picture.

I agree comparison isn't great. But it's too easy to compare yourself to most millennials who don't have a thousand dollars to their name and think you're doing great.

Housing market definitely hurt us. We just bought and when we drop to one income it will eat up a big chunk.

Current savings are 15% of my salary into Roth 401k. Wife isn't putting anything in hers as she isn't planning on being in the workforce for long. Other savings are just put into mutual funds. We have 4-6 months emergency fund.

Being as polite as I can, you're doing better than 99% of Americans right now... especially at your age with that revenue stream. Continue saving and maxing out retirement as much as you can. Plan when your wife stays home/have kids as best as possible.

You are definitely on the right path for taking care of yourself and your family.

You are 27 and she is 23. Wait 5 years for kids. IMO.

Your financial situation will thank you in 10 years.

Over the next 5 years get your savings over 50%. Then enjoy being parents with a lot less stress.

Your wife should still be putting money away into an ira whether she is planning to work 6 more months or 6 more years.

redag06 said:

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Your wife should still be putting money away into an ira whether she is planning to work 6 more months or 6 more years.

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I've contemplated this, but seems like more of a hassle to keep up with an account with a few grand in it that we can't touch. What would be the reasoning if she actually does only work 1-2 years?

-don't let her be stay at home, delay as long as possible
- have kids early, spend time with them, delay and you will regret
- spend less, save more, convince your wife you are both poor
-don't let up on the gas until you have 3-4 mill net worth

[You are not going to post in that manner on this forum. -Staff]

SoupNazi2001 said:

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Your doing well. Comparison is the great thief of joy though. There will always be people your age who make and save way more. Having a stay at home parent when kids are young is well worth the financial sacrifice in my view.

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Everything said here is spot on.

I make a nice living, and have had some good breaks come my way (along with some bad breaks).
One of my former roommates married extremely well. His wife's family has an entire building named for them at one of the top 10 universities in the nation. They finally sold their family business a decade or so ago for over $400 million. People gawk when they go by his house (his wife wanted it, not him). I cannot honestly say that my friend is any happier than I am.

My wife got laid off in a downsizing within 6 months of our marriage. I have been the sole provider for our family. Our son is absolutely attached to her (much more than to me). That is priceless.

Don't be stupid or showy with money, but enjoy life. Spend as much time as you can with your kids. Whatever you do, though, don't compare yourself to people with more. That's much easier said than done. Spend a day or a night in a homeless shelter every once in a while if you do find yourself doing that.

Obviously a Sock said:

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SoupNazi2001 said:

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Your doing well. Comparison is the great thief of joy though. There will always be people your age who make and save way more. Having a stay at home parent when kids are young is well worth the financial sacrifice in my view.

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Everything said here is spot on.

I make a nice living, and have had some good breaks come my way (along with some bad breaks).
One of my former roommates married extremely well. His wife's family has an entire building named for them at one of the top 10 universities in the nation. They finally sold their family business a decade or so ago for over $400 million. People gawk when they go by his house (his wife wanted it, not him). I cannot honestly say that my friend is any happier than I am.

My wife got laid off in a downsizing within 6 months of our marriage. I have been the sole provider for our family. Our son is absolutely attached to her (much more than to me). That is priceless.

Don't be stupid or showy with money, but enjoy life. Spend as much time as you can with your kids. Whatever you do, though, don't compare yourself to people with more. That's much easier said than done. Spend a day or a night in a homeless shelter every once in a while if you do find yourself doing that.

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My wife got laid off on our honeymoon. Lol. And like I said, I agree with not comparing yourself to people with more, but comparing yourself to the rest of America isn't necessarily good either, since most people are horrible with money. Just trying to be better than average.

Don't forget charity. It doesn't have to be a lot, but find something you want to support and it will bring you joy helping others.

TommyBrady said:

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Don't forget charity. It doesn't have to be a lot, but find something you want to support and it will bring you joy helping others.

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Good point. We give to church every Sunday, but it definitely needs to be much higher on the percentage scale. Thanks.

Howdy Dammit said:

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redag06 said:

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Your wife should still be putting money away into an ira whether she is planning to work 6 more months or 6 more years.

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I've contemplated this, but seems like more of a hassle to keep up with an account with a few grand in it that we can't touch. What would be the reasoning if she actually does only work 1-2 years?

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First, there are investments you can buy within the IRA where you don't have to look at it for 30 years if you don't want to. Second, look up a Spousal IRA.

Offense:
-Max out HSA. It goes in tax free, grows tax free, comes out tax free if used for medical expenses. Do not touch it. Let it grow and then pay yourself at a later date if you need to.
-At least match employer 401k %, at your income, contribute the full 19.5k
-Your income is already going to phase you out of pre-tax IRA. Consider still maxing out the 12k between IRA and Roth IRA. I doubt your employer has set you up to do a mega-backdoor roth IRA, but at your stage in life you need some cash not tied to retirement, so I don't think thats necessary right now.
-If your company does a discount stock purchase program, max it out and immediately sell once you get your hands on it. Consider it an option.
-Once you have kids, use a Dependent Care Spending Account to make it tax free childcare for the first 5k.

Defense:
-Set a budget and stick to it. Give yourself room to enjoy your life, but sunday brunches add up no matter what
-Stay in your home for as long as possible.
-Do not upgrade your cars unless you've got a falling apart rust bucket. If you must upgrade try to wait through the next 18-24 months. Buy gently used. Do maintenance yourself. Oil changes, flushes, and regular cleaning will keep a modern car running with minor issues for as long you want.
-Do not buy all new home furniture immediately. Yeah having college kid furniture for a while sucks, but anything you buy immediately just to 'have something' you're going to regret in a few years.
-Facebook marketplace for wood furniture. Estate sales for tools.
-Mow your own yard.

Giving:
-Give some to a charity you really enjoy. It'll be the best money you spend. Figure out what you want post retirement investment vehicles to go into a general investment account versus giving.

Go read millionaire next door.

Your finances are perfectly fine for having kids right now. There's a minimum floor for the cost of child raising, but the ceiling is however high you want. You don't need designer furniture, all the toys, etc. Facebook marketplace is a great place to buy things like strollers. I wouldn't wait too long, you never know what can happen in the future. Go get a good europe trip in and then pull the goalie.

Just my personal experience, but I've received a lot more by donating my time to charity rather than money. No wrong way here though!

I'll answer explicitly. $39,000 a year into 401(k)'s (two earner household) adjusting annually for IRS increases. Blend between Roth and Traditional. Then $7,200 a year into 529's for our two children. Next we spend. Because no guarantee of tomorrow or a healthy retirement. What's left goes to commercial real estate (family business).

All I have to add is I don't think you'd regret having her stay home with the kids.

You're doing just fine. Lots of good advice here that I won't add much to except to say that you shouldn't wait on kids too long. 5 years is pushing it for sure. If you want to hold off, give her 2 years or something then have at it.

Quote:

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having her

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I agree, somewhat. I would not "have" my wife stay home. She has the option to work or stay home . My wife loves her career which means I step it up more around the house to maintain balance. We both work, we both raise kids. It works for us, and there is no right or wrong approach.

No shot on convincing her on the 5 years. Lol. And I agree that no one regrets having kids earlier and more of them. I also want her to stay home and not work. Sorry if it came across as something I viewed as a negative. That's Something I always asked early on in relationships. My mom at home with us was the greatest blessing ever. Definitely worth the financial loss. Thanks for all the advice

Make sure and budget a mother's day out expense too...she will want/need it.

Yeah man, you're kicking butt! Keep it up.

bcasey03 said:

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All I have to add is I don't think you'd regret having her stay home with the kids.

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Nothing better than having a stay at home mom for a wife. Your kids are raised by your family, not some damn day care.

25% of gross is excellent, but are you adequately assuming what children are really going to cost? In hindsight, I would have had kids earlier. Don't forget that 529. Start it at birth.

You're young enough to still have a lot of wage growth in front of you. Don't feel guilty if you're not perfect for a couple of years.

Howdy Dammit said:

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Obviously a Sock said:

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SoupNazi2001 said:

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Your doing well. Comparison is the great thief of joy though. There will always be people your age who make and save way more. Having a stay at home parent when kids are young is well worth the financial sacrifice in my view.

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Everything said here is spot on.

I make a nice living, and have had some good breaks come my way (along with some bad breaks).
One of my former roommates married extremely well. His wife's family has an entire building named for them at one of the top 10 universities in the nation. They finally sold their family business a decade or so ago for over $400 million. People gawk when they go by his house (his wife wanted it, not him). I cannot honestly say that my friend is any happier than I am.

My wife got laid off in a downsizing within 6 months of our marriage. I have been the sole provider for our family. Our son is absolutely attached to her (much more than to me). That is priceless.

Don't be stupid or showy with money, but enjoy life. Spend as much time as you can with your kids. Whatever you do, though, don't compare yourself to people with more. That's much easier said than done. Spend a day or a night in a homeless shelter every once in a while if you do find yourself doing that.

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My wife got laid off on our honeymoon. Lol. And like I said, I agree with not comparing yourself to people with more, but comparing yourself to the rest of America isn't necessarily good either, since most people are horrible with money. Just trying to be better than average.

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I missed the "off" part of this sentence during the first go around. I was thinking to myself....well I hope so!!!

I think you're doing great financially. I started having kids in my 20s and don't regret it.

The only thing that I will add is that I didn't fully understand how little free time I would have after having kids. Obviously I knew my lifestyle would change, but you don't fully grasp it until you're in it. So, take that vacation, weekend trip, etc and enjoy it.

Take the stay at home one step further consider Momma becoming a home school teacher in a co-op, so she has a structured support system and network, but it frees you from having to play the "two income, expensive as hell house" game in desirable school districts we've done it and zero regrets.

Sounds like youre doing well. Dont forget to spend some money and travel/eat out well before you have kids. As others have said on this thread, your time will get compressed with kids.