Our Retirement Plan

To keep things simple, our retirement plan is modeled after an investment policy statement (IPS).  The original purpose of a IPS is to be the written guidance for your investment manager on how to manage your investments. Since I am acting as a DYI investment manager, our IPS serves as the written plan of our investment goals and long term strategies to meet those goals. 

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DIY Financial Report Every Year! Are We Crazy?

Author: Ben Holden

When my wife and I were engaged we had two sets of finances and goals.  We decided to have a "finances day" to discuss among other things how we planned to combining our finances and what our short and long term financial goals would be for our married life.  When I was researching on how best accomplish our financial goals almost every article I read recommended having a written financial plan.  There are a lot of good reasons to have a written plan, but the augment that made the most sense to me was that people are pron to priorities the "needs" and wants of today and to loss sight of anything long term.  A written plan helps to align your short term spending and savings with your sometimes abstract long term goals (saving for college or retirement).

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5 Things to Consider When Choosing a Health Insurance Plan

Open enrollment season is upon us once again. Step one usually consists of insurance companies reducing benefits and raising prices, ironically they blame one or both of those action on the Affordable Care Act (ACA). Step 2 is trying to decide which plan is best for our situation.

When evaluating a health insurance plan there are five things to consider:

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It's Not Roth or Traditional...You Need Both.

For my wife and I, the choice between a Roth and traditional account boils down to picking the account mixture that allows us to pay the least in taxes.  In simple terms, we do this by comparing the marginal tax rate we pay today and compare it to the marginal rate we expect in retirement.  Both Roth and traditional accounts are great options and there are other reasons besides marginal tax rates to pick one over the other.  I recommend reading the Bogleheads wiki pages if you need a primer on Roth and traditional retirement accounts or the difference between marginal and effective tax rates.  

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Why We Are Paying Our House Off Early... Even Though it is a Bad Idea

Conventional wisdom is that getting out of debt is always the smart move.  Intuitively, my brain tries to apply this "wisdom" to our mortgage and I want to think that we should absolutely pay our mortgages off as early as possible.  However, given our historically low interest rate of 3.5%, only slightly higher than historical inflation of 3%, paying our mortgage off early makes little financial sense.  In fact, I would argue that if we were being 100% rational, we should do a cash-out refinance at a 30-year mortgage (rates about 3.8% at the time of writing) and leverage the cheap money to invest for retirement or other long-term goals.

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Education Savings: Our Unconventional Approach

My wife and I put a strong emphasis on the value of an education and want to give our children every opportunity we can.  As Catholics, we believe our first responsibility as parents is to teach our children about our faith, by creating a home environment suited for education and fostering Catholic values.  A Catholic education can provide an excellent academic education and, more importantly to us, it is a great extension of our teaching and example of faith and love at home.  We decided early in our marriage that we were going to make saving for a Catholic school education one of our highest priority savings goals. We have three main goals for our education savings, listed here by priority:

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Master Limited Partnerships, are the returns worth the complicated taxes?

So you are debt free and have built up your emergency fund : what now? First congratulate yourself on a great accomplishment. Now, it's time to start investing and as far as passive investments are concerned, full market funds with low fees are the way to go. However, depending on your risk tolerance, a small portion of your portfolio can be in alternative investments. One such option to consider is Master Limited Partnerships (MLPs).

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Online Shopping for Groceries. It's About Time!

I should start by admitting that I Hate Shopping!  When I go to a store, I want to get in and out as soon as possible.  I tell my wife that "I go buying, not shopping."  I love online shopping; I buy everything I can from dog food to diapers online.  I like that I can quickly comparison shop, read reviews, find out if it is a good price, get discount codes, use cash back sites, and, most importantly, it saves me time.

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Emergency Savings How Much is Enough?

An emergency fund is basically a pile of money that is used for unexpected expenses such as car repairs, medical costs, or natural disasters. We all will have at least one unexpected expense in our lives so we need to have funds available to mitigate it. An emergency fund can be comprised of short and long term savings that are intended for standard large purchases (house, car, boat, etc..).

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