[USER]

I feel stuck and like I don’t know what we should be doing financially.

Would love advice from all the financially literate minds in this community.

My husband and I are 47. He brings in ~80k/year.

My base salary is ~270/year with 85k/year in long term options and a 22% yearly bonus.

We have just under $2 million saved for retirement.

Our only debt is our home and we owe $180k/ could sell for around $450k if needed.

We have 2 kids- a rising high school senior and a middle schooler.

Our youngest has had a really rough life health-wise (cancer that they will survive but will have life-long physical disabilities from).

We don’t have any sort of trust in place or any other long term financial plan other than “work hard and save as much as possible” but I feel like we’re now out of our depth and don’t know what to do next.

I don’t understand what I should be doing financially to make sure we’re maximizing our high earning years to ensure we are able to retire comfortably.

It’s also important to us to leave money to our children so they can pursue jobs that they are passionate about and don’t have to pick something just to make ends meet.

This is especially important to us for our youngest given their health challenges and (current/developing) career interests which are not likely to be lucrative- we want to make it so they have one less thing to worry about since they have drawn the crap end of the straw so far.

If you were in my shoes, what would your next steps be? Find a financial advisor?

I want to be smart about this and I am out of my depth. I am a big nerd at my job, but one who doesn’t know anything about finance or investing.

If you’ve made it this far- thank you.

Advice and direction is deeply appreciated.

[Charlotte]

You have 2 million in retirement but don’t know anything about finance or investing?

[Kara]

This is super basic advice that is given here a lot. But it is really solid advice to give you a straight-forward education on these issues.

Read The Simple Path to Wealth by JL Collins.

Your first priorities are living below your means and investing the savings.

As a next step, and before meeting with a financial advisor, I’d meet with an estate planning attorney to set up a trust (and/or whatever else they recommend) to make sure your assets pass smoothly to your kids (especially important when a child may have long-term health issues).

After both of those steps I might consider paying financial advisor for a few hours of their time to give you some goals and long-term perspective.

But do not buy complicated life insurance or annuity “investments” from the financial advisor (or anyone else).

Investing your money is super straightforward: you put it in a broad-based market fund and you leave it for decades.

That is how you grow wealth.

[Frank]

Add up your annual expenses. I suspect you don’t have a financial problem at all, especially if you do not plan on retiring early, and are already Coast FI.

What you really need is a trusts and estates attorney to plan for your younger child.

And to review your life insurance situation, because this situation may call for permanent (whole life) insurance.

But get independent advice apart from insurance providers first.

[Rebecca]

If I were you; I would start looking into whether a special needs trust is appropriate to your situation and how to structure that if it is.

[张扬]

You said it yourself: you don’t know anything about finance or investing.

I would therefore make it my part time job to educate myself on finance, investing, trusts, etc., so that I can tell if a professional is feeding me BS should I decide to use one.

This isn’t that difficult, but it does require a little bit of time, however I believe it’s worth the “investment” to avoid getting taken advantage of.

You don’t want all the hard work you’ve done to go down the drain because you trusted the wrong person/company.

[John]

I would definitely read one or two of the popular basic investing books mentioned around here, but thinking finding a fee-only fiduciary financial advisor to create a baseline plan would be a good thing for you.

With $2m saved at your age, if you continue growing and contributing to that you are going to need some long term tax planning, for later decades especially.

[Wendy]

I’m so sorry your youngest has faced such challenges. Huge congrats on rocking the finances in the midst of dealing with so much! I second the “no” on a financial advisor.

Bigger Pockets Money and Choose FI have a wealth of free info for you.

One thing I’ll add to what everyone else is saying – college.

I’d try to keep your expenses as reasonable as possible.

Modern Stares for CLEP tests, dual enrollment if possible, community college if that’s a good fit – prioritize loving the school they loves your child (and your wallet) back.

I wish you the very best of luck!

[Rick]

“Work hard and save a lot” is what got a lot of us here far along our fire journey before we knew of a fire journey.

So, you are not alone with that experience and feeling.

Good news bad news – there is no one big complex silver bullet to your need.

There are a dozen or more small wins for you to start working through and incorporating into your plan (and you can choose which connect best with you or are low hanging fruit for you as the ones to start doing first).

I think of it this way but it’s clearly not the only way…

Why then What then How.

In that order even though human nature is to jump straight the How.

Why – what are your (individual and then as a couple) whys.

Why do you want to build a large net worth?

Why do you want to make work optional?

Why do you want to provide for your children?

Why do you want a life different than most?

This can be things but I believe the Whys are more powerful when emotions based and not things based.

What – what processes are available to you personally to achieve your whys.

Maybe you have a generous company 401k match or a great pension.

Maybe you have a high income.

Maybe you live in a low cost of living area. Maybe you have a passion for rental real estate.

Maybe you have quirky big blocks of employer stock grants. These whats build a direction and a path forward to your whys.

Hows – only now should you begin to learn the nitty gritty on best practices to implement your Whys+Hows.

Hows include processes like picking your contribution % to specific account types, picking your desire investment fund mix like total market fund or stocks&bonds or total market + small company stock fund, etc.

How’s include decisions like is 4% rule right for you and how do you build a plan to retire at X age or how do you build a plan to get to X amount asap.

Getting to this point will also help you maximize your time, and its cost, with an estate attorney.

If you start with why what how, you will avoid the frustration of a shoot ready aim effort.

Good luck on your journey!

[Wendy]

Good job so far. Aside from retirement accounts, what type of non-retirement savings do you have?

Do you have an easily accessible emergency fund? An HSA?

Any accounts that have beneficiaries (like 401ks) are good… but you will want a will and trust for other accounts and assets.

Find a good estate lawyer and spend ~$4k to get a will and estate plan.

Is your high school child going to college?

Did you have money set aside for that?

The “just keep saving” approach is great at your age if you have no particular plans to retire soon.

Make sure you and your family are having some fun, take your vacation time, enjoy your life.

Save for the future.

Keep living on less than you make.

[Kelly]

Do you have a written budget? Your income is high. What do your monthly my expenses look like?

[Victoria]

Wealth conservation attorney, they know all about the medical aspect of money and chronic illness.

I am the chronically ill person in our marriage and my husband is a multiple times skin cancer survivor with every type of skin cancer and a new polymorphic melanoma that is so rare that he’s a case study for 4 prestigious skin cancer treatment hospitals.

[Holly]

The last thing you need is a financial advisor who wants 1% or more of your assets each year, especially since you have done so well on your own.

[Chilling]

You’re doing great. You should definitely consider setting up trusts for your kids.

An estate attorney can help with that.

Are you involved in any associations for kids with cancer / disabilities?

They might have advisors that have knowledge on what kind of trust / financial setup would make sense for a child with these sort of health issues.

I think that is beyond what a regular financial advisor would know.

[Dave]

An idea for your kids: set up a Roth IRA for each of them. They can contribute 100% of their earnings, up to $7,000 every year, to their Roth.

If you make 12%, money doubles every 6 years (Rule of 72).

So, if it’s only funded one year, in 48 years, when your middle schooler is 62ish, they’ll have $1.8 million available, tax-free because Roth is an after-tax investment.

You kiddo pays taxes today, as their today-tax-rate, then it just grows and grows.

Imagine if your children each fully funded their Roth with $7,000 per year!

So, to get income, they need to earn money.

There’s a number of ways to do that–if they’re interested in business, help them start their own LLC, and have Square or Stripe handle their transactions.

My 9-year-old grows Loofah sponges to sell and makes Loofah Soap. Her sales are officially recorded so she can file taxes.

Maybe you buy a dozen or two for teacher-gifts every semester, and they’re priced as artisan soaps, but that is A LOT of soap.

Instead, you may commission an art piece, or a new logo design, or something they have an interest in, and you can pay generously for their creative work.

Or their car detailing, lawn mowing, house painting, anything, but document their income and pay them with a check or have Stripe or Square handle the transaction.

They end up with their own LLC, some business understanding, a great customer (you!) or two or more, and they earn $7k+ per year, file their own tax return, and fully fund their Roth IRA which will then grow tax free.

When they’re older, that will have turned into a nice pot of money.

*not a financial advisor or business advisor or legal person or any of that.

My opinion is just that, my opinion.

Any other legal disclaimer needed, insert here.

[Sari]

I just had a nice chat with Patrick Phippen who was recommended by one of the readers who wrote in to the 1% better email.

He is an attorney who specializes in Fi and charges flat fee for all types of work.

His services are exactly what you need.

[Sierra]

You’re doing great, this sounds like a lot. and you have a great income and savings!

I don’t know a lot about it, but it sounds like you may want to look into a special needs trust.

I’m not sure if you’d reach out to an advisor, CPA, and/or lawyer for that.

Maybe others with more experience there can chime in.

[Loraine]

Have you looked into an ABLE account for your youngest? Brian from the money guy show has a special needs child and he frequently talks about this.

[Susan]

definitely consult with a financial advisor and an estate planner.. you may need a special needs trust for your child..

this takes regular planning, adjusting and revising as you and your child age, your situation changes, etc.

put some of that savings to work for you.

make sure you have a fund to cover emergencies including possible future medical issues for your child…

ask your medical team what the future needs might be long term so you can plan/anticipate (and save an extra30% more) …

interview several professionals to find the one that works best for you…

make sure you understand their fee schedules too

[Author]

Posts