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Today, I bring to you three very fun but straightforward questions. Here they are:

Question #1: @01:56

Dear Joshua,\xa0

My wife and I are well read in the areas of index fund investing, frugal living, early retirement, and financial independence (including your podcasts). \xa0We have been on the path to early retirement for many years and we think we are there. \xa0We both have high stress jobs and want to quit to raise a child and do whatever interests us whether it brings additional income or not. \xa0We want to have a significant financial cushion, but also don\u2019t want to be so conservative that we work years longer than necessary. \xa0We are worriers and are very conservative in our estimates.

Although we are fairly confident in our calculations for early retirement timing, we hired a fee only financial planner for an outside opinion, and the experience was positive, but we believe the timing recommended was extremely conservative (4 years from now without a child; 5-6 years from now with a child). \xa0We have a very good handle on our spending as we have been tracking it closely for several years.

The financial planner did not seem to understand our frugal lifestyle and rather than reducing our current spending by the \u201ccost of working\u201d that we clearly communicated, he added $15,000 per year to our current spending, which significantly changes the projections for retirement. \xa0The explanation given was to account for \u201cunexpected expenses\u201d, but that amounts to >$20,000 per year in excess of our retirement spending estimate below. \xa0We would be very grateful for your opinion of our plan to retire NOW, given the following data, which we have abbreviated to the most important points.

Ages: Him-45, Her-37

Debts: None (own a house and 2 cars free and clear)

Assets ($1,300,646)
$714,200 \u2013 His/Her TSP (Federal 401k)
$347,554 \u2013 Taxable Account (Vanguard Index Funds)
$216,165 \u2013 Cash/I-Bonds
$22,727 \u2013 His/Her Roth IRA
$31,000 \u2013 His Pension (starting at age 60)
$6,000 \u2013 Her Pension (starting at age 62)
(Minimum of $100,000 net after moving and downsizing our house \u2013 not included in assets total above)\xa0

Asset Allocation:
40% Total US Stock Market (Vanguard/TSP Index Funds)
12% Total International Stock Market (Vanguard/TSP Index Funds)
33% Bonds (TSP G Fund)
15% Cash (CDs)

Spending:

Current Spending: $45,000
Retirement spending estimate $37,000
*This is after removing the easily calculated \u201ccosts of working\u201d ($10,000 in property tax!; $3,000 in gas!) and adding estimated cost of health insurance ($5000?)
Note: We will be moving from a very high cost area (suburban Chicago) to a very low cost area (rural Florida)

Question #2 @26:20

Joshua,

Came across your podcast and dig the advice/honesty.

I've read numerous articles encouraging the use of fee-based financial advisors but haven't had a lot of luck finding the right person.. discouragement set in after numerous canned responses/what seemed like aggressive sales tactics.

I made somewhat of a half ass attempt in my early 20s with regularly maxing out a roth/always contributing enough to various company 401k to get the contribution match.

I've not paid a lot of attention and recently realized I'm holding roughly 50% of my total assets in a standard savings account yielding only 1%.

Without pulling the actual figures that'd be ~90k in retirement accounts Roth/Traditional rollover and ~90k in straight up cash... terrible I know.

My question is how do i fix/prevent it? I currently have one investment property with a mortgage that's less than what it's leasing for.

I see a couple fix it options:

Buy another house\xa0

Pay down existing mortgage

Invest outside of a retirement account

I believe adjusting my 401k contribution may be a start to preventing it but what about after I max it out?

I don't mind paying for advice but what I really want is someone that's hands on/up to date.. helping me get the most out of my money.

Question #3: @46:37

Joshua

My name is Joe and I\u2019m 24 years old. \xa0I\u2019ve been listening to your show for a while now and really enjoy it, keep up the good work.

My question has to do with whether or not a Roth 401k is the right move for me. \xa0Currently my gross income is $58,616. \xa0This year, I\u2019ve contributed 6% of my AGI into a regular 401k and my employer matches .80 cents on the dollar up to the first 5% of my pay. ($3,517+$2,344 = $5,861) \xa0I also contribute to my Roth IRA and will max it out at $5,500.

My employer just recently began offering a Roth 401k option and my question is whether or not it is the best move for me to make to begin contributing to the Roth vs the regular 401k? \xa0I understand the tax benefits on the front end at my young age and do believe taxes will rise in the future and also that I will hopefully be in a higher tax bracket in retirement than I am now. \xa0In my mind, the advantage of the Roth is the higher contribution limit (18k vs 5,500) but the advantage of the Roth IRA is I have it at Schwab and have lower fees and more investment options than inside my 401k. \xa0I would like to keep my net take home pay the same and am having trouble running the math to figure out which would be the better option. \xa0In addition, I have the option to do a Roth 401k conversion on the $12k that\u2019s in my Regular 401k. \xa0Your advice would be much appreciated. \xa0

About me:

Assets: $27k in Roth IRA, $12K in 401k, $3k in taxable investment acct, $6K in savings acct, $2k in checking acct

Debts: $41,200 Federal Parent PLUS @ 7.65% and $16,500 @ 5.25%. I currently am on the standard repayment plan (10 yrs) and make an extra $100 payment each month on top of that. No credit card debt or any other type of loan, own a 2005 Camry that is paid off.

***

Enjoy the show!

Joshua