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Decided to payoff my mortgage.
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I’ve been where you were. The first step is to make sure you have enough in your primary checking account to cover up to 3 months worth of costs. This way you know you are good. The then put and other 3-6 months in my savings account and another 6 months in my taxable brokerage account.
As my pay gets deposited, my balance increases and I can see that, then the expenses come out. I don’t fear having to wait for a paycheck to pay for a bill.
Don’t have too much money in your checking account, inflation eats away at the value.
If you can see that you are able to make your bills easily and still have a growing balance e, consider yourself lucky.
It also sounds like some counseling could be good for you. People have hangups about money. It sounds like you have a complex issue with money. This happens if you watched your parents struggle with money or you went through a hard time.
You are killing it in income most can only dream of. If you feel cash strapped, it’s simple. you either are or it’s just a false sense of anxiety from past trauma like maybe you grew up very poor and had to be frugal with every dollar! If you actually are cash strapped it’s because your expenses are to high. To much money going out as you’re also constantly working to much without much R&R, aka earning and not really living, which can “feel” like your stuck too. perhaps you pull back in some expenses or investments and save the cash. One easy way to do this is to buy things like high value collectibles or precious metals. It’s hard to feel cash strapped when you -KNOW- you’ve got 100k in gold bars in a safety deposit box!
Maybe you’re not good at managing money… you make a lot.
Managing lifestyle.
Why are you paying $24k a year for day care if one spouse doesn’t work?
I understand hiring some part time help as a SAHP but it’s really hard to understand why you’re confused about feeling cash poor when you’re living off one income AND paying for full time childcare. That’s honestly kinda nuts.
Those insurance polices are scams so that’s the #1 thing that I would remove.
Your feelings don't match your description of your pay/savings/investments. What else might be driving your perceptions?
Why do you have that type of life insurance?
Agree bcg1
Subject Expert
Remind yourself often that you aren't treading water, you are getting ahead. Every month you contribute. It matters.
And give serious thought to getting rid of the IUL and VUL. How bad are the surrender fees? You will be underperforming as long as you have them and putting more in all the time.
Subject Expert
Yeah, I agree with BCG1. Run the numbers in some depth and understand the plan, maybe with the help of the folks here, or by yourself or with professionals. It may feel irreversible, but it might be that you are better off suspending new money into these, or surrendering them, despite the sunk cost.
You’re doing great, especially at your age. There’s always added pressure when you’re supporting a family on a single income, and inflation certainly doesn’t make it easier.
From what you’ve shared, it sounds like you’ve spent years doing the right things—saving aggressively, investing consistently, and prioritizing your family’s future. Ironically, that level of discipline can sometimes make it hard to enjoy the success you’ve already created because you’re so focused on the next goal.
I had to medically retire at 42, and I’m incredibly grateful that I saved and invested aggressively while I was healthy and working. That preparation, along with disability insurance benefits, Social Security, and a rental property, allows our household to maintain roughly 95–100% of our pre-retirement income. Yet I still catch myself feeling “cash strapped” at times because the paychecks stopped and everything now arrives monthly.
What I’ve learned is that feeling financially secure and actually being financially secure aren’t always the same thing. Your numbers suggest you’ve built a very solid foundation. Don’t forget that it’s okay to enjoy some of what you’ve worked so hard to create. Life has a way of reminding us that tomorrow isn’t guaranteed, and there’s value in balancing preparation for the future with living in the present.
2 people retired, make 28K before taxes. We don't complain.
having a 2nd child does not sound doable given your current feelings about cash-strapped and hoping your wife can go back to work... it would be nice to have it all, but sometimes it's not in the cards... time to scale back and live within your means...
wow cash 290K is awesomely great !! I don't have that after 25 years in a major company and with reviews where I was told I were great ... I am at 165K cash, and about 210K total comp (Canadian $) and I have 2 kids ... now you are making me feel poor 😭😭
Well you definitely aren’t living paycheck to paycheck. That would look and feel very different.
You are getting to the age where having enough for retirement starts to get very real as you are starting to see the actual time horizon get into range. I would say: a) part of this is psychological - budget, plan, use spreadsheets, chart your path. If it works for getting you to a good spot for retirement - including funding college for the kid and whatever else you want, great. Look at the math and take comfort. If it doesn’t, then change - try to reduce expenses and save more. You should start to see more compounding as your investable accounts grow.
Minor points: I tend to hold a good bit more in cash, but more because of my income / tax pattern then real emergency need. Given that OP could draw from the taxable account, 30k may be enough emergency fund. Personally I’d bump it a little, but depends on job security, etc.
On the insurance products - I have avoided whole life products, but once you are in them, not sure it makes sense to exit. Maybe people can elaborate? I understand them to be poor products for most, but not sure that makes them scams. They still do what they say they will do. OP is already knee deep in them so not sure what the math looks like to exit.
That's Trump's America for you. Maybe try a different country.
What are your expenses?
@Manager
I think we found the issue. You think that is not a heavy spending lifestyle. You're dismissing the "others" spendings but those of us who manages our finances know those little things add up quick. It sounds like you might not be even closely tracking your finances and therefore feel trapped. From a quick calculation, you should be having leftover much more than most people make a whole year.
What are your expenses and what are your goals (eg early retirement and when?)
Retire by 55.
Dave isn't always on point but I think he's got life insurance dialed in. Here's a clip to consider: https://youtu.be/FD0sVaK83wU
I'm not sure if you're flexing or truly worried! I'm about to simplify by moving to a smaller place in a couple of months because living paycheck to paycheck is giving me anxiety.
It might feel that way if you are consciously or unconsciously measuring yourself to others in your circle. Most if not everyone does this from time to time. Take a step back, acknowledge that life is good, note that you probably don’t need half as much as what you have to be happy and start there. And if mentally you can’t get there, seek God for balance.
We’re conditioned to think wealth is how we measure success, but that means absolutely nothing after we pass. What will be more lasting and bring you more happiness is loving yourself and others.
Hope you find the peace you’re seeking.
God bless.
You say it's not a humble brag... And yet...