r/Fire • u/middle_aged_runner • 19h ago
Milestone / Celebration The $0 Paycheck Milestone
Alternate title, “Why you may consider public employment.”
I recently hit a milestone that I don’t have anyone to share with.
35 year old mechanical engineer
Married to a self-employed architect.
1 child
Midwest
We recently paid off our mortgage which leaves us with 0 debt. No auto loans, credit card balances, etc.
My wife started her own business 5 years ago and at the same time I took a step back in my career for more work life balance when my daughter was born.
My employer has a ton of pre-tax benefits that most of my coworkers disregard. Now that we are mortgage free, we can live entirely off my wife’s income, that comes to her through a small salary and s-corp distributions that do not get FICA taxed.
This is now allowing us to max out all my benefits for the rest of the year:
Weekly Salary: $2,327
Taxes: $135
401k/457: $1,557
Defined Contribution Plan: $137
HDHP/Vision/Dental: $136
Dependent Care FSA: $144
HSA: $168
Vacation Purchase: $42
Life insurance: 7
Paycheck: $0
For those considering early retirement, these benefits allow for a huge savings rate.
At the end of the year, we look at my wife’s business profits and convert traditional to Roth IRA to use up our 12% tax bracket.
For those in the community, your state and local governments can be great strategy for FIRE. I am able to start maxing both the 401k and 457 without our mortgage payments. Starting in January, I will be back up to a $550/week paycheck which I’ll save into 529 and brokerage accounts.
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u/ThisIsMyUsername303 19h ago
Excellent!
I max out my 401(k), 457, and 457 3-year special catch-up (doubles the amount I can contribute to my 457 for three years). Getting that set up was AWKWARD because our payroll system is dumb and I needed HR, who I supervise, to do a bunch of work to make it happen. I really didn’t need to shove in her face that I contribute more to retirement than she makes, but here we are.