Asked by Mike  |  Submitted November 07, 2014

We are seeking advice on how to save/invest my wives disability retirement income.

Wife is 51 with a county disability retirement that we do not need to live on and I'm still working. She has a small 457 account 40K, but no Social Security. She plans to work PT in the future at some point. I am 56 with 310K in 403b putting in about 1770 a month, will get Social Security and just opened a Roth IRA 1K, putting in 300 a month. We have 10K liquid saved for emergency. House is paid for and thru wife's former County job medical and dental covered 100%. Thanks for any advice you might have for us.

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  Answers  |  2

November 20, 2014

Hi -

The first action I would take is to make sure you fully fund Roth IRAs for each of you. You can each contribute up to $6,500 to a Roth IRA each year. This is true even though your wife isn't working. A non-working spouse is allowed to contribute to her own IRA as long as the working spouse (you) has earned income (wages, salary, etc). So that takes care of $13k per year. It looks like you are not fully funding your 403b plan - you need to take advantage of the catch-up contribution of $5,500 (in 2014) for a total of $23,000 - you still have two or three paydays in 2014 to increase your contribution. The limit increases in 2015 to $18,000 plus the $6,000 catch-up for a total of $24,000. Be sure you take full advantage of that increased limit. Beyond fully funding your retirement plan opportunities you could consider adding to your savings (nobody I've ever met was unhappy to have more in savings), a taxable investment account using low cost index funds or even a rental property. Good luck!

$commenter.renderDisplayableName() | 06.20.21 @ 03:34


January 21, 2015

Hi Mike. Did you ever take any action on this or get the answers you were looking for? One piece of the puzzle you mentioned is Social Security. In case you happen to live in Southern CA, my firm will be hosting several hour-long Social Security workshops in Orange County the first week of Feb, 2015. We'll be discussing little-known techniques which can help you maximize your SS benefit - and increase it as by as much as $200k. Contact me for details. Thanks!

$commenter.renderDisplayableName() | 06.20.21 @ 03:34