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It's me again, couple of big changes in my life since November 2016.

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Hi again, a lot has happened in 6 months, now I'm engaged to be married in September and Currently paying Mortgage on a house.  I have no kids and we ARE NOT having kids.
My fiance has minimal retirement assets but makes roughly 10k more gross.  I don't even want to get into her retirement right now, let just focus on my options.

Unfortunately I drained my emergency fund for Wedding Ring/Wedding/House Down Payment Costs

I haven't deposited ANYTHING into Roth this year because of all the changes that happened in my life.

I have $5,470.64 ESPP that has yet to be sold (and can be this year) and I am curious what the best way going forward should be on this.
Should I sell it, move the proceeds to roth ira, and add the remaining difference out of my emergency fund ($29.36) to top off my roth for 2017?
or
Should I sell it, put $3,422.38 into my emergency fund (totaling 4k) and the remaining $2,048.26 into my roth IRA for 2017.

Finally going forward I really don't think filing together will be useful to my situation whatsoever.  So I intend to file Married (separate), i assume this is the best plan.

Also in case it wasn't clear, since my ESPP is what is funding my Roth IRA. I assume the best thing I should do is sell my stock as it becomes available and IMMEDIATELY transfer to roth IRA as opposed to doing it at the end of the year like this time happened to workout.

You guys have been terribly helpful and I appreciate all the input I have been getting over the past 2 years.

My original post on July 5th, 2015.
I am 29 years old and live in Minnesota and know nothing about investing.
My gross income is $33,924.80
My 401K totals $17,834.09
I have $14,504.43 invested in Comcast stock which I intend to sell, is there a way for me to put some, or all of that into my 401k?
I currently invest 10% of my income into 401k and 10% into Comcast stock (at 15% discount)

November 2016 update (age 30):
Gross Income: $36,689.12
401k: $26,185.63
ESPP Comcast: $6,821.96
Roth FUSEX Investor Class: $11,214.84
Emergency Fund: 4k
I currently invest 10% into 401k, 10% into ESPP, 5% into roth added VERY recently (supplemented by stock sales to make $5500.00/year)
I am aiming to retire at 50, but I know that probably isn't realistic.

Current Information 9 months later (August 2017 Age 31):
Gross Income: $37,978.72 +$1,289.60 
401k: $37,203.72 +11,018.09 
ESPP Comcast: $9,563.16 +2,741.20 
Roth FUSEX Premium Class: $13,026.31 +1,811.47 
Emergency Fund: $577.62 -3422.38  

Comcast ESPP is as follows:
10% maximum
15% discount
must hold money for 1 year before you can sell


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rated:
Roth can double as an emergency fund since its post-tax and you can take a loan from yourself, so put it all in a roth. You have until April 2018 to contribute to 2017 IRA.

Until you have your emergency fund built back up (in cash) turn your 401k contributions down to whatever gets the maximum employer match.

Moving forward you should always max and then instantly sell your ESPP (its free money with an insane return), dont wait for the long term gains rate/423b disqualification stuff... you don't have enough saved and its too risky to sit on it for a year to get a stepped up basis for tax purposes. At <40k AGI your marginal rate is very low.

Last suggestion: look into low income saver's tax credits... I dont know the income limits and benefits but if you do qualify, they are nice.

PS - You wont be able to retire with that income and that savings rate. I'm sure you've realized by now but retiring at 50 is a pipe dream. We are about the same age, I max my IRA, 401k, and live on 20% of my post-tax income and even I wont be able to retire at 50 based on numbers I've ran.

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You mean I won't be able to retire at ALL or at 50?

I already came to the conclusion that 50 isn't realistic but I think 60 might be possible.

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What is your fiance's approximate income?
Why do you think you're better filing married separate? Did you run the figures both way?

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I haven't ran the figures both ways she makes approximately 48k gross

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Run the figures both ways. It sounds more beneficial to file jointly. Since you're now a homeowner, also run the numbers for taking the standard vs itemized deduction. There was a good suggestion for looking into the Saver's Credit. You need to get your AGI under $31,000 if you file separately, or an AGI of $61,500 for MFJ. It doesn't sound like you are in a position yet to max a 401k (and keep funding your Roth over a Traditional IRA if you aren't on the cusp) but something to keep in mind if you up your savings rate to lower your AGI.

Also, once you develop some equity in your home, look into getting a HELOC to backup your Roth as an emergency fund. As I'm trying to maximize my retirement contributions, I currently borrow against my HELOC to fully fund wife's and my Roth and pay back the HELOC throughout the year. You pay some deductible interest and assume some risk of market downturn, but overall it's worth being able to max your IRA if you expect increasing income down the road, especially because you can't go back in time to max it later. Keep up the good work and savings goals.

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A HELOC isn't a bad idea for an emergency fund, but I don't get borrowing against it to fund your retirement if you are simply paying it back throughout the year. Why not just fund your retirement throughout the year? Are you doing it via the HELOC because you are simply assuming the market is just going to keep going up and the sooner you get in, the more you'll make?

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meade18 said:   A HELOC isn't a bad idea for an emergency fund, but I don't get borrowing against it to fund your retirement if you are simply paying it back throughout the year. Why not just fund your retirement throughout the year? Are you doing it via the HELOC because you are simply assuming the market is just going to keep going up and the sooner you get in, the more you'll make?
  Scarcity of the available ~$10k for the short term. The only reason I mention it is that OP sounds to be in a similar situation. If you have $10k cash set aside in an actual liquid emergency fund, that would be more appropriate than borrowing against a HELOC since your high yield checking account APR is likely a little less than that of your HELOC interest rate.

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jd2010 said:   Roth can double as an emergency fund since its post-tax and you can take a loan from yourself, so put it all in a roth.
 

  To clarify, you cannot take a loan from a Roth IRA.  But you can withdraw your contributions at any time.  So a $5k contribution to a Roth is no different than $5k sitting in a low-rate savings account, as far as what can be accessed for emergencies.  If it truly is your emergency fund you probably want to minimize risk, but 1% from a savings account isnt going to add meaningfully to your balance anyways so you lose nothing from using whatever low/no risk investment options in your Roth instead. 

Once you've stabilized and built up assets available for emergencies, you can shift those Roth funds to more aggressive investments - but if you dont contribute the money now, you cant make it up later.  So your first priority should be to max out the Roth contribution, even if you leave the money sitting there uninvested for now.

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Corndogg said:   
meade18 said:   A HELOC isn't a bad idea for an emergency fund, but I don't get borrowing against it to fund your retirement if you are simply paying it back throughout the year. Why not just fund your retirement throughout the year? Are you doing it via the HELOC because you are simply assuming the market is just going to keep going up and the sooner you get in, the more you'll make?
  Scarcity of the available ~$10k for the short term. The only reason I mention it is that OP sounds to be in a similar situation. If you have $10k cash set aside in an actual liquid emergency fund, that would be more appropriate than borrowing against a HELOC since your high yield checking account APR is likely a little less than that of your HELOC interest rate.

  It only makes sense if you assume your investment return exceeds the interest cost of the HELOC.  In which case, you should continue investing your extra cash through the year instead of paying down the HELOC balance.

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Roth as a emergency fund, to preserve your annual contribution amounts when funds are tight.

https://www.bogleheads.org/wiki/Roth_IRA_as_an_emergency_fund

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Glitch99 said:   
jd2010 said:   Roth can double as an emergency fund since its post-tax and you can take a loan from yourself, so put it all in a roth.
  To clarify, you cannot take a loan from a Roth IRA.  But you can withdraw your contributions at any time.  So a $5k contribution to a Roth is no different than $5k sitting in a low-rate savings account, as far as what can be accessed for emergencies.  If it truly is your emergency fund you probably want to minimize risk, but 1% from a savings account isnt going to add meaningfully to your balance anyways so you lose nothing from using whatever low/no risk investment options in your Roth instead. 

Once you've stabilized and built up assets available for emergencies, you can shift those Roth funds to more aggressive investments - but if you dont contribute the money now, you cant make it up later.  So your first priority should be to max out the Roth contribution, even if you leave the money sitting there uninvested for now.

My mistake in using term "loan".  You can borrow funds from it with a 60 day window to repay it before you lose ability to recontribute the $$$.  

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Unfortunately I drained my emergency fund for Wedding Ring/Wedding/House Down Payment Costs
 


   ----- Those ARE NOT emergency fund worthy withdraws ------------

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skh12 said:   
 
Unfortunately I drained my emergency fund for Wedding Ring/Wedding/House Down Payment Costs
 


   ----- Those ARE NOT emergency fund worthy withdraws ------------

  You mean "I want to buy ______" isn't an emergency?

What if I REALLY want it?

edit:  then again, house down payment threw me to -$35k in credit cards a couple years ago, and I'm still at around -$20k or 25.  I still had another $40k with ~2% apr loans available as "emergency fund" though.  And I've got 1100 shares of Aapl I can sell if I run into a true emergency.

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i would personally dial down the espp contributions; if you could immediately dump for a 15% guaranteed gain minus tax, that would be one thing, but a 1-year minimum hold requires you to assume more risk. i would push at least some of the espp money directly to the roth until you're maxing it annually, rather than floating it for a year in company stock and hoping you make enough on the sale to max the roth.

rated:
skh12 said:   
 
Unfortunately I drained my emergency fund for Wedding Ring/Wedding/House Down Payment Costs
 


   ----- Those ARE NOT emergency fund worthy withdraws ------------

  Sort of depends... Pics???

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98% of couples are better off financially filing a joint return. It's actually quite rare to ever want to file married separate. This is because you will still always have the same tax brackets as married filing joint, regardless if you do married separate.

That is, essentially, because 98% of people SHOULD be taking the standard deduction. Unless you spend over $12,500 every year on mortgage interest, state income taxes + property taxes, you are most likely not better off filing separate.

Also in general, if you want to retire by 50 (hell even 60 depending on how long you want to live to and what you want to do when you retire) you need to drastically increase your incomes... I mean, have you even established costs down the line like children? That will certainly throw a wrench in your plan if you didn't factor things like that in.

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justignoredem said:   That is, essentially, because 98% of people SHOULD be taking the standard deduction. ...
  

~30% of households itemize.

https://taxfoundation.org/who-itemizes-deductions/

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