I'm thinking about hiring a financial advisor. Fee based fiduciary. Should I?
We've pretty much maxed out our annual retirement investments and just paid off big student loans and aren't sure if it would be a good idea to try to save for a down payment on a stupid million dollar house in the Bay or do something else with the excess. Or should I just make myself spend the time to figure it out myself
SD is right, and navigating these accounts is a little passion of mine. Here are the accounts I would make sure to take advantage of before using a regular taxable account or just fun money (more or less in order of priority):
1. HSA [$7k max for family plans]
2. Pre-tax 401(k) (or Roth 401(k) depending on income) [$19k max]
3. Post-tax 401(k) (if your employer offers it) (this is different than a Roth) [additional $38k above the $19k I think?]
4. IRA (or Roth IRA depending on income) [$6k]
5. 529 for the kids (if applicable) [$300k total max (don't do that much); careful about gift tax junk which kicks in after like $13k/year]
6. Some kind of low-risk safety net (money you can use for big unexpected expenses--I'd keep it in a low risk/bond heavy portfolio rather than high interest checking, but not a huge difference)
#3 and #4 can be backdoored into a Roth IRA with very little consequences. If your employer offers Post-tax 401(k) AND in-plan Roth conversions you definitely need to take advantage of it. Like SD said, if you make too much to contribute to a Roth IRA directly, just contribute to a regular IRA and then immediately convert it. It's a stupid rule, but the IRA and Congress have blessed this as pretty much totally legit, so any of the major account providers give you simple instructions for doing the conversion.
After those accounts, it's really just a personal preference thing. I want to retire when I'm still healthy enough to do fun things, so a lot of my excess goes into a regular investment account for that purpose. But I don't fault anyone who would rather plan on a comfortable 60-65 year retirement and just have fun with what is left.