Personal finance is 1000% easier than fitness. You can literally find the motivation one time to set everything up, and then let the process work for you. Turns out, hitting the gym once won’t get you the abs.
We have 90% of our finances automated. What actually happens is this:
⭐️ Multiple investments come out before we see our checks. This removes any temptation to spend the money and is one of the best personal finance hacks there is. These include:
- Her Roth 401k
- His traditional 401k
- Solo 401k (for small business owners only, but allows us save taxes on business income)
- His & her HSA *100% of balance is invested
- Dependent care FSA *not an investment, but reduces our income taxes and pays for childcare
⭐️ After-tax investments are next. These include:
- His & her Roth IRAs
- Taxable brokerage
- Investment real estate
- Kiddo investments *For the full scoop on how to invest for kids, click here
*The Roth IRA always comes before the other post tax investments! Tax free money in retirement is too good to pass up.
We contribute the MAXIMUM allowed to all accounts up to the Roth IRA. There are no maximums on investment real estate or taxable brokerage. We are focused on investing as much as we can early on, so that we can take advantage of our allowing time & compound interest to go to work for us.
Pro tip - make sure you don’t just automate your contributions to the account. Automate your actual INVESTMENT itself too (aka the purchase of an index fund or ETF).
If you're sorting out what investing accounts you should use in what order, I've got a map for you. If you want the nitty gritty on how much you should contribute & how to actually invest inside of those accounts, Money Boot Camp for White Coats will answer all your questions.
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