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Old 01-21-2016, 08:39 AM
 
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Quote:
Originally Posted by Pitt Chick View Post
Start college fund(s), start wedding fund(s), max out all retirement options, increase charitable donation.
Check
Nope, never paying for that
Check
Does the massive increase in taxes I'll be paying count as charity?
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Old 01-21-2016, 08:43 AM
 
Location: southwestern PA
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Originally Posted by MDrenter223 View Post
Does the massive increase in taxes I'll be paying count as charity?
No.


Perhaps this will help.
Charity Navigator - Your Guide To Intelligent Giving | Home
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Old 01-21-2016, 08:49 AM
 
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Originally Posted by MDrenter223 View Post
I totally understand it's a good problem to have, but it's still foreign to me.

In just a few months my take home household income will double. This is after putting 20% into a 401(k).

My family lives modestly, but comfortably, and we live on just 75% of our take home now, putting that other 25% towards who knows what in the future and everything was working out just fine.

But now we will be living on just 37.5% of our take home and I figured you guys would have the best insight on what to do with such large savings.

Early Retirement isn't in the cards, the spouse and I both love our careers and although that could change its not likely. Can't cut back on hours either (salary).

On our current income we go on vacations, drive safe and reliable cars, live in a great area, and eat healthy food (natural vice organic if that makes sense). There's really no further utility for us, so what do you guys do.

Put it in the First World Problems thread.
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Old 01-21-2016, 08:51 AM
 
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Quote:
Originally Posted by suzy_q2010 View Post
Consider:
  • A fund for new vehicles, for which you could pay cash when you need to buy.
  • A fund for each kid. It could be structured so that it could be used for college or anything else. I do not buy the idea that paying for a child's education will necessarily ensure he will be lazy and goof off. You can certainly make it clear what your expectations are concerning grades, graduation in four years, and what the child will need to contribute. I suspect that, barring a catastrophe, your financial situation will limit need based grants and aid for your kids. On the other hand, I suspect that it is likely they will do well academically and perhaps get merit aid. The debt that people are going into for college now is astronomical, especially if graduate school is in the future. Having a six digit education debt certainly can affect a child's path.
  • Investing outside the 401K. Choose something conservative and let it grow.
Neither my spouse nor I graduated in four years, maybe there's something to be said for not working in college. Looking into it I do think we will fund 529's, but with some loose strings (apparently one of them is state school unless it's a top notch private).

If nature and nurture both hold true the kids should do well (good genes and we've pumped a whole lot of time and money exposing these kids to an enriching environment).

The growing money just because thing is my hang up. What do I need it for? I guess just to save for something I don't know I need yet.

We've got life insurance, disability insurance, and careers that we love and can do until we kick the bucket, but have no real use for the money now.

I really just wish we could cut back on hours, spend more time as a family, but it is what it is I guess. Do you think getting a maid, and maybe some of those semi-prepared meals would be a good use of this money? In theory it would give us more time together as we wouldn't be spending our free time doing chores.
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Old 01-21-2016, 08:55 AM
 
1,162 posts, read 1,267,138 times
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Originally Posted by Nonchalance View Post
Put it in the First World Problems thread.
A decade of post secondary education will do that. You get so used to living like a starving student that when you finally get that salary you were promised by your high school guidance counselor you are not sure what to do with it.
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Old 01-21-2016, 11:00 AM
 
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Live the same way. Sock the extra away. If you can divert the majority into investments or tax shelters BEFORE taxes that will be better. Congrats on the raise
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Old 01-21-2016, 12:06 PM
 
Location: Georgia, USA
21,498 posts, read 26,102,510 times
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Quote:
Originally Posted by MDrenter223 View Post
Neither my spouse nor I graduated in four years, maybe there's something to be said for not working in college. Looking into it I do think we will fund 529's, but with some loose strings (apparently one of them is state school unless it's a top notch private).

If nature and nurture both hold true the kids should do well (good genes and we've pumped a whole lot of time and money exposing these kids to an enriching environment).

The growing money just because thing is my hang up. What do I need it for? I guess just to save for something I don't know I need yet.

We've got life insurance, disability insurance, and careers that we love and can do until we kick the bucket, but have no real use for the money now.

I really just wish we could cut back on hours, spend more time as a family, but it is what it is I guess. Do you think getting a maid, and maybe some of those semi-prepared meals would be a good use of this money? In theory it would give us more time together as we wouldn't be spending our free time doing chores.
Definitely get the maid! I suggest a service because then you do not have to withhold and report taxes. Unless your rent includes lawn service or you like to garden for relaxation, hire that out, too.

What do you do for child care? If a nanny or au pair would be a consideration, then preparing the evening meal could be part of that person's duties. DH and I were fortunate to have a nanny who did it all: child care, laundry, and light housekeeping. Ours lived in.

We think we have prepared for everything, but life likes to throw us curve balls. My career took a detour because my older son developed childhood leukemia (ALL) and I cut back on my work. That caused a drop in income that there was no way to make up. He did well with treatment and I subsequently ramped it back up again.

I was fortunate that I did not have to work while I was in college. My parents could not afford to help me much, but I went to a a state school and had scholarships that covered tuition. I ended up borrowing very little. That was also a long time ago. I do think it would have been difficult to get the GPA I had if working had been necessary.

Speaking of which, do you and/or your spouse have education loans to pay off?
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Old 01-21-2016, 04:36 PM
 
Location: Raleigh
6,975 posts, read 5,191,475 times
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Quote:
Originally Posted by MDrenter223 View Post
I really just wish we could cut back on hours, spend more time as a family, but it is what it is I guess. Do you think getting a maid, and maybe some of those semi-prepared meals would be a good use of this money? In theory it would give us more time together as we wouldn't be spending our free time doing chores.
Think about things that keep you guys from doing that right now. A maid/cleaning lady might help. I had a great aunt who referred to it as "the best investment in mental health you can have."

Think about things/trips/experiences that would ALLOW you to spend more time as a family. It could be a condo at the beach for the summer, it could be a home theater, etc...
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Old 01-21-2016, 04:42 PM
 
12,404 posts, read 9,203,248 times
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Quote:
Originally Posted by MDrenter223 View Post
Does the massive increase in taxes I'll be paying count as charity?
You don't use your take home pay to pay taxes.
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Old 01-21-2016, 05:03 PM
 
Location: Vermont
5,439 posts, read 14,329,796 times
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Roth IRA on top of the 401k is a good bet, IMO.
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