Greetings all! It’s tax time, so I’ve been looking over last years numbers. All in all, it was a good year financially. While we only worked five months in 2014 (we were busy doing other things), we did manage to stash away a little over $46,000. Most of our savings went to the 457 accounts at our new jobs. We also maxed out our traditional IRAs and our health savings account. Our 2014 savings total also includes our son’s accounts: a Coverdell ESA, a 529 plan, and a UTMA account. Here is what we were able to do last year:
In 2015 we hope to save even more by fully funding every retirement account available to us just like we did back in our Echols County days. There is nothing glamorous or sexy about this savings strategy; it’s just good ole hardcore savings*. Last December I went to my employer’s human resource office and set our 457 contributions to $4,000 a month for both my wife and myself. That means we’re putting $8,000 away every month; we’ll do this every month until we hit our 457 and 403b limits.**
Since I am now officially an old fart (51 years old), I qualify for “catch up” contributions to my 457, 403b, and IRA accounts. So, I can now save an extra $6,000 a year in my 457 and 403b accounts while also adding an extra $1,000 to my IRA…in total an extra $13,000 a year! Keep in mind, those contributions are on top of the already generous contributions limits of $18,000 on 457 and 403b accounts and $5,500 on IRAs.
Apart from our retirement accounts, we plan on fully funding our HSA account and our son’s Coverdell ESA this year. We also plan on investing $1,000 in a taxable mutual fund account with Vanguard within the next month. As we have done for the last nine years, we’ll continue to fund our son’s 529 plan and UTMA account. We plan on upping the UTMA contributions to $25 a month.
Here’s what we hope to accomplish in 2015:
Is anyone else out there planning on saving a bunch of money in 2015? If so, how do you go about it?
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