Update on the job

[docstudent]

As previously reported, I started a new job a couple of months ago. My new salary is $172,400, and I’m taking home about $7100 (after contributing $2000 a month to my 403b, which will begin this month.
Take home: $7100 + $2300 (rental income), $9400 per month.

Savings account #1, $48,600 (4.9% interest)
Saving account #2, 24,949 (6.0% interest) max allowed is $2000 per month, credit union summer saver account.
Stocks: $34,600
403b 1: $80,000
403b 2: $22,009
403b 3: $20,000
403b 4: $18,000
Traditional Roth: $2600 (will fund fully by Dec of 2023)
STRS: $178,000 (primary account) and $76,000 (secondary account)

Debts:
Mortgage: $158, 755 (value $450,000 to $520,000)
True value: $475,000
Car: $14,100
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Monthly bills:
Mortgage: $1482, $150 extra principal (included in the amount paid)
HOA: $399
Car: $499
Insurance: $181
Gym: $9
Netflix, Apple Music: $19
Food: $280
Gas: $250
Rent: $1370 (moved away for new job)
403b Contribution:$2000
T. Roth: $1000
Saving/Stocks: $2000
Entertainment/Fun/Travel: $400
Rental property utilities: $250 (I will not be paying electricity when I lease my property out next year). I was only paying $60 per month.

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Not sure if I will get the pre-tax deduction bc of salary for my T. IRA, anyone knows the income limits? Should I continue if I can take advantage of the deduction? I know that my cash reserve is higher than necessary, but I don’t want to dump in stocks and I’m waiting to buy more as prices shifts. Any immediate suggestions? If I stay my current job the salary will jump to a base of $177,000 and bonus of $4100. My aim is to retire in 2030, and I plan to receive a monthly pension of $5,500 to $6,500, but it can increase if I continue to increase my base salary.

[Like2Plan]

As previously reported, I started a new job a couple of months ago. My new salary is $172,400, and I’m taking home about $7100 (after contributing $2000 a month to my 403b, which will begin this month.
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Not sure if I will get the pre-tax deduction bc of salary for my T. IRA, anyone knows the income limits? Should I continue if I can take advantage of the deduction?

2023 IRA Deduction Limits - Effect of Modified AGI on Deduction if You Are Covered by a Retirement Plan at Work
https://www.irs.gov/retirement-plans...t-plan-at-work

Anyone can have a non deductible traditional IRA, but then there is additional paperwork and accounting that needs to be done for it. And, you must continue to track your basis (that is your non-deductible contribution) and account for it when you take a distribution in retirement (or otherwise pay taxes on the contribution amount twice).
form that must be filed with your income taxes when non-deductible contribution is made:

https://www.irs.gov/pub/irs-pdf/f8606.pdf

Income limits for making direct contributions to Roth.
https://www.investopedia.com/article...tion-rules.asp

If your MAGI is below the income limit for Roth (but exceeds traditional deductible IRA contribution levels) this year, you might want to consider re-characterization from traditional to Roth.
https://investor.vanguard.com/invest...aracterization

You can make non deductible contributions and then do conversions to Roth, but when you do the conversions you have to consider the pro-rata rule.
link to pro-rata rule explanation: https://www.bogleheads.org/wiki/Trad...o-rata.22_rule

explanation of non deductible traditional ira contribution and subsequent conversion to Roth:

https://www.bogleheads.org/wiki/Backdoor_Roth

[disneysteve]

You said "Traditional Roth" which is an oxymoron, but then also mentioned the Traditional IRA deduction. Is it a Traditional IRA or a Roth IRA?

I'm guessing the multiple 403b accounts are from previous jobs. I would roll over all but the current one into a rollover IRA. That simplifies your accounting, gives you much greater control, and likely reduces your investment expenses.

It looks like you're bringing home $9,400/month with expenses of about $5,200/month leaving you a surplus of $4,200/month which is great. You're using that surplus to fund your IRA and other savings. I think you're doing great.

One thing you didn't mention is the interest rate on the car loan. It might be worth paying off if the rate is high.

How is everything invested? What is your current asset allocation? You mention not wanting to put more into stocks but I can't really comment on that without knowing your current breakdown. Also, market timing never works. If you're sitting on cash waiting for the "right" time to invest, you will lose every time. But if your portfolio is already 80 or 90% stock, then you're probably fine. Also remind us how old you are.

[docstudent]

I meant a Traditional IRA, and the interest rate on my car is 2.4%.

I know timing is never perfect when it comes to the market. At the moment, I have invest 75% in tech, mainly Apple and Microsoft which have provided returns of 12% & 15%. The remaining funds are invested in the EV Sector and Health care.

My aim is to retire in 2030, at the age of 53, but I can push to 55, but that’s not my preference.

I plan to contribute the max to the IRA by Dec of ‘23, and fund the max for ‘24 by June of next year.

This month since I could not contribute to my 403b, I put $2600 in IRA, and $3000 into my Robinhood account and will eventually out 2G into the stock market sometime this month. I have been splitting 50% in Apple and 50% in Microsoft over the past two months.

[docstudent]

I want my IRA to be tax deductible, but I didn’t know if I met the eligibility requirements.

[Like2Plan]

I want my IRA to be tax deductible, but I didn’t know if I met the eligibility requirements.

I provided you some links in my response above.

It sounds like you are covered by a retirement plan since you are planning to receive a pension (and I believe a 403 is considered a retirement plan: https://www.irs.gov/retirement-plans...-annuity-plans ) .
From there, it depends on your filing status (married?, single?) and what your Modified AGI is (line 11 on your 2022 1040).

Explanation for what is Modified AGI from Investopedia

https://www.investopedia.com/terms/m/magi.asp

So, we know what your new gross will be after you start your job in a couple of months, but we don't know what your Modified AGI is going to be at the end of year because we don't know what you've made up to this point.

Your AGI is: "Your adjusted gross income is all of the income you bring in, minus certain adjustments. You can find the allowable reductions to your income on the front page of your Form 1040"

Your MAGI is "Your modified adjusted gross income (MAGI) is your adjusted gross income (AGI) plus additional items such as student loan interest, qualified education expenses, passive income or losses, IRA contributions, and foreign income, among others."

[bjl584]

I'd want to knock the car loan out if I was in that situation. You could have it gone in a few months if you shift some things around temporarily.

[LivingAlmostLarge]

it's not deductible unless you make very little since you are covered by a work plan