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With the run up on the market the last few years, from January 2019 to today, the balance in my workplace retirement account has more than doubled. It helped that in 2019 I did 28.04%, 2020 I did 22.98% and so far in 2021 I'm at 18.88% ytd.
My individual brokerage account has done even better. It's 5.2x larger from January 2019. 2019 I did 37.16%, 2020 I did 37.11% and 2021 I'm at 20.18%ytd so far
I realize it's not like that every year, but it's amazing what compounding can do during a hot market. I'm 41 years old so I have lots of time for more "doubling" to take place.
How are you 5.2x since Jan 2019 with that performance? You’d have to add a lot. With no contributions 37%, 37% and 20% only returns 225%
How are you 5.2x since Jan 2019 with that performance? You’d have to add a lot. With no contributions 37%, 37% and 20% only returns 225%
I have added a lot. I've only had the account opened since 2017 so I've hustled to get it above 6 figures as quickly as I could. I learned with my my workplace retirement account that once it hit 100k, it doubled at a faster rate. I'm hoping it follows that trend.
If you start at 25-30 and you invest say 6K a year in a 401K plus get another 2K in match - you'll have around 1.3 million dollars at 60
so why do so few people have million + in a 401K?
There's plenty of ways to save. A 401k is just one of them (and a good one to take advantage of if you can). 1 million is not wealthy by today's standards.
My previous employer used the 2008 economic troubles as an excuse to stop 401k matching. I opted to invest the money elsewhere putting a little bit in 401k. It was only this year that they reinstated it which had a lot to do with trying to attract hires. Just in time for my division to be sold off to another company. My new employer has matching and I am taking full advantage it.
There's plenty of ways to save. A 401k is just one of them (and a good one to take advantage of if you can). 1 million is not wealthy by today's standards.
$1 million is nothing, especially if you retire at say 65 and could live another 25 years. Taking 4% per year (the rule of thumb) is the responsible thing to do for living expenses, and also waiting until age 70 to tap social security. $40k a year is nothing, unless you have zero debt and the house is paid for. Even then you might want a part time job to supplement from age 65-70, for example.
$1 million is nothing, especially if you retire at say 65 and could live another 25 years. Taking 4% per year (the rule of thumb) is the responsible thing to do for living expenses, and also waiting until age 70 to tap social security. $40k a year is nothing, unless you have zero debt and the house is paid for. Even then you might want a part time job to supplement from age 65-70, for example.
When someone says a million is nothing it throws up some red flags. It’s a lot, far more than most will ever have. Do you need more? Maybe. Do I? Most definitely
When someone says a million is nothing it throws up some red flags. It’s a lot, far more than most will ever have. Do you need more? Maybe. Do I? Most definitely
So to put in to context, $1 million is a lot of money all at once, say if you were spending that in a year or 2. But over 25 years with no other income coming in? It's not enough for most to keep up even 75% of their lifestyle (over 25-30 years) when they were working. Thats what I meant.
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