They periodically speak with representatives from the four different financial companies where they have investments, but do not have a clear picture of how all the pieces should fit together. Additionally, the couple has two young grandchildren and would like to help with their college education expenses.
They also tell us that they want to keep $100,000 as savings and invest the other $60,000. Neither has opened a 457b plan with the university, which would allow them to tax-defer another $26,000 each from their salaries.
They decide to do so, thereby saving roughly 40% in taxes on the combined $52,000 they put into the plan. That extra deferral keeps them under the income limits for contributing to a Roth IRA, so they both do that as well. They also decide to put $5,000 each into a 529 college savings plan for each grandchild, allowing them to deduct the combined $10,000 on their Michigan income taxes.