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jymitch -

You may be a candidate for a Roth/IRA! $2000/year may be contributed into a Roth account (on after-tax basis) & grow a tax-free gain if held at least 5 years + post 59 1/2 age withdrawal... If you wife has earned income, she could also save in a Roth.

After devoting money to a Roth you might then invest in mutual funds that minimize year-to-year taxes by reducing capital gains and/or dividends - they focus on long term growth. There may be several to pick from.

As for the 403b... I'm a strong advocate, but in your particular situation may suggest otherwise. Look at the amount of pay reduction (into 403b) that would keep you in the lower tax bracket - that might be the amount to defer?

Good luck & best wishes... PP
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