Good Morning! Looking for some advice and not finding much when Googling
My husband and I make a combined income of $278k (gross). Since we are behind on retirement I would like to save 25% of our gross or $69500. If I max out my 401k ($22500), max out my employers HSA ($7500) and max out a back door Roth IRA ($6500) that only gets me to $36500. How do I save the remaining $33k? My husband has a pension so there isn’t an opportunity on that end with him. Is there a cap on how much I can save annually in a Traditional IRA?
If you have a situation where you can create a side business that can show a profit, a SEP IRA allows up to 25% of employee compensation to a max of $66K.
We also maxed out our tax advantaged accounts and invested in index funds in our brokerage accounts. Some considerations about taxable accounts: dividends at taxed at the lower dividend tax rate, the tax efficient index funds limit capital gains, tax loss harvesting can be done, and there is a step-up basis at passing for any remaining funds that go to heirs.
That’s good to now as a future option. Right now we both work for an employer and have small kids so there isn’t much extra time for a side business. But that may change when the kids are grown
We are no over 50 yet. I am 42 and my husband is 35 but once we are both 50 we definitely will up on contributions to the max. My husband is not receiving a pension yet his employer is only contributing as part of his retirement. So since he is working he can also contribute $6500 to a back door Roth IRA? I wasn’t sure if the cap was the total cap for us a married couple filing jointly or an individual cap.