[USER]

My husband and I are both 37 and we have 2 children under 3 (we would like to have a third child).  We have made some bad calls with investing and planning for our future (due to not being educated and being overwhelmed with learning), and are trying to get on track.  Please share thoughts and advice.  Our goal is to “world school” or “road school” but at minimum, we will be homeschooling.  Ideally, we would move ASAP, but neither of us have remote jobs.  We don’t know how realistic any type of retirement other than the standard is for us.

I work part time and stay at home with the children.  My husband works full time in education.  We have switched our roth iras 3 times and most recently, after learning the 1% is not smart, closed our accounts with our most recent advisor.  We have been trying to look for a “one time fee” advisor, but haven’t had any luck.  Our money is currently sitting with Charles Schwab, unmanaged.  My husband can access an HSA, (we are on a high deductible family plan through his employer), but we have never taken advantage of this.  My understanding is I cannot access one since I don’t have health insurance as a part time employee. My husband can access a 403 (b) and I can access a 457(b), but we have never taken advantage of this either.

– GOAL: Live as digital nomads, frugally, in low cost areas, traveling with our children as we continue to contribute to our retirement and eventually retire.  Decreasing our expenses by living somewhere much more affordable so we can increase our contributions would be great and we are open to this!

– Debt- 13k in a car loan (3% interest)

– We each have a Roth IRA that we max out each year with Charles Schwab (each account is currently around 53k)  our money is divided among XMMO, GTO, QQQ, SCHF, SCHO, SCHZ, SCHD, RLY, ANGL, VTHR and mutual funds BROIX, RAPAX.  Honestly, these are just letters to me and I don’t really know what they are.  Our previous advisor set these up for us and we have identical portfolios.

– We have a shared joint tenant account at 8k in some of the ETFs mentioned above (this is intended to be for our oldest and we would like to invest another 10k for our second child,) these are accounts that would just sit for them

-88k in a HYSA at 4.31% (this money includes our emergency fund and funds we have been saving for a down payment on a home)

– Given our monthly expenses, we can invest an additional $800-$1200 a month, right now we put this in our HYSA.

– We will both eventually have access to a retirement account through our jobs, but we aren’t counting on any signficant income from those.

-our house is paid off and could probably sell for around 185k (in hindsight, we should have invested instead of paying off our mortgage, we did this when we had 2 full time incomes).

– We want to move, we don’t feel safe in our neighborhood.  Crime has increased in the last 3 years and there are gunshots several times a week just a block from us. We also live 4 houses down from train tracks and don’t feel safe given the recent chemical spill in Ohio.  These are things we could deal with, if it weren’t for our young children.  While we want to move, we don’t necessarily want to stay in the city where we live.  We are here because our jobs are here.  We would love to find remote jobs and be digital nomads, eventually traveling the world with our children.  Because of this, buying a second home in this city doesn’t seem like the smart thing to do.  To be in a safe neighborhood, we would likely be spending around 300k for a new home (this would not be a fancy house by any means, just in a safer neighborhood).  We could sell our current house or rent it to help with the mortgage.  We always intended this house to be rental income at some point.  We’ve been looking since February but it is hard when you have a house paid in full and are basically making a lateral move house wise for a safer neighborhood.  I think we have been stalling because deep in our hearts, we don’t want to be in this city, but it is convenient with our jobs.  We want to travel with our children.

– As we continue to tighten our budget, where should we be putting any extra income that we normally put in the HYSA?

– Any thoughts on the house situation- money wise?

– I have read about low cost index funds such as VTSAX.  Right now our money is spread among different funds.  Do we just leave it there or sell and put all our money in a fund similar to VTSAX?  Should we put all new Roth IRA contributions in a VTSAX or similar fund?  We don’t know what we are doing with this.

– What is the best option for the 10k we want to invest for each of our children?

– We are very financially illiterate.  We are kicking ourselves for not learning about this at a younger age.  I grew up financial and home insecure, so this has led to my mindset of keeping money in savings and paying off our house.  I hope the 10k for each of our children will help them reach their goals when they are our age.

– Any leads on advisors that charge per hour vs the 1%.

Any thoughts, advice, and considerations are welcome.

[Carrie]

You can self manage in Fidelity, and I like that you can buy partial shares. I personally stick to VOO or VTI and some BND. That’s pretty much it. They have low fees but I know there are also no fee equivalents. I don’t prefer mutual funds such as VTSAX due to it being a mutual fund and increased tax related costs.

Fairly certain for the HSAs you can have you hubby contribute up to the family max of over $7k, but since my family doesn’t qualify for one I’m not 100% sure of the details.

I would recommend reading any and all books you can on the topic. My local library had so many of them.

If you want to move, perhaps the first step is finding a new teaching job for hubby in a different state or have you considered teaching English overseas? It could be an option to try for a year to see if that kind of lifestyle works for your family.

Also wanted to add, if your employer retirement funds offer a match you should at least contribute enough to receive their match.

Also, Read: I need to sell my house asap

[Mike]

I think you are more educated than you think, so don’t beat yourself up too much. There is a global teacher shortage at the moment, and many countries like Australia are bringing in overseas teachers. Teaching English is also a popular option in places like Asia.

You can totally self manage your investments. Read the book by JL Collins and listen to some podcasts.

I’m an assistant professor at a college. We max out the HSA and the college sponsored retirement plan. When I was a firefighter, we maxed out the 457. All self managed.

It sounds like moving is in you best interests. So exciting. This is totally doable. My kids are dual citizens of the US and New Zealand and love visiting other countries. Good luck. You can do this

[Sarah]

A few of your funds have high expense ratios, so I would definitely find cheaper versions of them…aim for less than .25%. If you are paying an advisor a percentage to manage it, that it will also cost you a lot.

You have a lot of questions and a lot of moving parts. Because you have specific goals (I think this is helpful and great when working with a planner) and a lot of questions, I think a fee only fiduciary advisor would be a good fit. Look on xyplanning network or fee only network. You could look for an hourly planner or flat fee for a financial plan. Both will likely cost you 1-2k.

If the planner helps you set up new portfolios, make sure you know what percentage each investment should be so you can rebalance. I think you could have a lot fewer funds. You can google lazy portfolios for some simplified ideas. Lots of people like jl Collins 2 fund approach, but you can have more and still stay pretty simple.

[John]

Can you just stay put for 2 more years while you sock away more money? Look for digital nomad jobs now that you can grow into full time jobs in the next year or two. Once those nomad jobs replace your needed income then make the move out of the country and rent your house for income or sell it for a large transition cash nest egg.

I think the 3rd child should maybe wait until you get some of these pieces in place. Otherwise, you may find that the time and cost of a third child now will hinder your digital nomad goals.

[Michael]

I don’t think you are doing as bad as you think. Relative to most of society you have almost 6 figures saved and have income that exceeds your budget. Those are great!

I would address your living situation before anything else. You have a paid off house and can use either equity or rental income to fund your next home. The question is really, do you want to be a landlord. I faced this decision several years ago and decided no I didn’t want to be a landlord. For investing I like VOO and QQQM.

Recently I put some money in XLG which is just the top 50 large cap stocks. But 80% of my money is VOO or other SP500 index funds.

[Author]

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