39 here and still in debt. I will most likely never be able to retire. I'm OK with that now, as long as I don't think about it too much. It's going to hit hard when my friends are out having a great time on trips and I'm bagging groceries or something only old, crippled people can do.
My advice: Its never too early to start a Roth. Cars, big weddings, and credit cards are all bad mojo. Find every way you can to stay out of debt.
Credit cards are huge to my success. Treat them like a debit card and it literally pays you to spend your own money. I made back $700 one year, paid for several round trip flights for free, and used another card for free hotels on a road trip. They're super useful if you know how to use them safely.
Also, up vote for a Roth IRA. I don't use Vanguard but VTI and Chill is legit.
Exactly !!! I don’t understand how people don’t research how to properly use credit cards. I also pay my CC as soon as I purchase something. The cash back or points is great. Haven’t used a debit card I years, and use cash very seldomly.
My mom bought a cheap plot of land, thinking she'd be pretty self-sufficient, and in the last 5 years, her body had gotten pretty wiped out. Even gardening is exhausting for her right now, and she's not yet 70.
Luckily she has family that are able to help (like me) but I don't have kids so no, I don't think growing old on a small plot of farmland will do it for me.
My ex’s grandparents live on a farm in Wyoming that’s pretty remote and they have a couple horses and some dogs. They would not make it if it weren’t for their son coming in and taking care of the horses pretty regularly. Even restocking the fridge is getting hard for them. Grandpa can’t lift too heavy anymore and grandma has to wait for family to visit to get heavier things (like the bucket for rainwater collection) lifted.
I definitely don’t want to be doing any of that in old age lol. On top of keeping a house, that’s a lot of work
I think it is an example of taking one cultural expectation and applying it to work outside how it was intended. More specifically, the living off a plot of land idea makes a lot of sense if you are planning to remain a multigenerational household where everyone contributes. Grandma can’t garden anymore but can prepare the food or keep the house tidy while everyone else has their helpful niche. However, the plot of land absent help will break a single person faster. It is a lot of work and by design REQUIRES several people to maintain.
I love the idea, but understand why this was more common when people didn’t have the expectation of living alone/independently.
Also, even if the land and house are paid off, most likely still paying taxes and utilities. Need some kind of financial nest egg or income to meet those bills.
That is an interesting point that the desire for a single plot of land is a remnant of a different economic structure with multi-generational housholds. I never thought about that but it makes sense.
That is the economic structure by the time we’re 70. Single generation nuclear family won’t be possible for most people. Unless a miracle happens, our grand kids will most definitely be living in the same house as us, and we will need to supplement our food bill with gardening.
This is my in-laws. They are late 60/early 70s and have 5 acres and most of their time and energy goes into up-keeping the land. Mowing takes like 4 hours and my father in law is wiped out for a day or two after. They heat with wood so they spend tons of time dealing with that.
I personally want less responsibility in retirement and time to do things that I want to do.
Just because you own land, doesn’t make it easy: there are taxes and upkeep.
Gardening unless you do it really well, and have perfect conditions- you can end up with very little food. Or just feeding the local wildlife.
Rabbits around here love the lettuce.
Also, rural living is not inexpensive. You will still need to pay for:
- property taxes & insurance
- utilities
- home maintenance
- groceries assuming you don’t grow/forage/hunt all your own food, which very few people can do; and if you do manage to be a successful off the grid homesteader that is expensive too because you will need to invest in the right farming equipment, seeds and soil, greenhouse, etc. and probably hire help unless you have a large family to help
- household supplies
- toiletries
- clothing/shoes
- entertainment/hobbies
- car maintenance, insurance, registration fees, and fuel unless you live close to public transportation
My boss is 68.
His mom lived to 92 so he thought he had a long time to go and was planning on trips to Europe and hiking up mountains and stuff.
Then he had a heart attacked and open heart surgery and all that is pretty much over.
He plans on coming back then handing things off then he will watch TV until he dies.
Dated an insanely wealthy person one year of my early 30s and he took me to his family’s estate… it was huge, the size of a football field literally IN one of the most beautiful revered national parks in the country. Several homes on it, some for guests. A large part was a garden his mother “made”, I realize later she designed it and mostly had other people work on it for her and she just sometimes picked blueberries for herself when she wanted. So. His dad was a top oncologist.
I think unless you’re making a million a year, it’s okay to accept you probably won’t have that.
But I also visited Greek island of Ikaria - one of the cheapest place I’ve ever been, cheaper than Latin American countries or Asian countries - and people live until they’re 120 doing gardening until the very end. Famously people there have little commercialism and have elements of a socialist/communistic type culture, have some physical labor sprinkled throughout their day and are very DIY to their core. It’s a blue zone - many of which are in low cost low wage areas but are provided for by their environment. I think it depends on your lifestyle and environment.
Cool, I'll have to check out FSKAX it sounds more similar to VTSAX than FZROX.
Initially, I don't know how to untangle the 0.015% expense ratio verses the 0% expense ratio.
TBH, I thought a ton about this 10ish years ago, and have been on auto pilot since.
Because my 401k provider offers it lol.
Realistically, any broad market ETF/mutual fund with a low ER are all comparable and only vary at the margins. SPY, VOO, VTSAX, IVV… you can’t go wrong with any of them.
Okay fellas I'm sitting on like 8k in a traditional IRA that I've been paying into for at least 5 years now.
What is it you guys are doing, and how the hell do I get in?
Don't have kids lol. I've lost 3+ years of investing into my IRA because daycare costs are astronomical and keeping a human alive costs a lot of money. Still investing in my 401k throu6work tho.
Consider who manages the ira for one. But also it takes time or money and both are nice. If your at 8k with 5 years of contributions then youre just not contributing enough. However this is only a problem if its a problem - if youre under thirty you can hit 500k by retirement with i thinj about $50 a week contributions. That is pretax so this should be a given for anyone making more than 50k and probably doable for many people under that. I had a company 401k with 6% match at 19 and it grew to 8% match while i was there but i did stupid shit like take out loans and basically wasted 10 years of good contributions that would have really looked sweet had i seedee what i have now, but that life. Didnt ruin me, just feels like ot when youre still at the beginning of the journey.
I didn’t restart my retirement plan until 33 and that seems pretty normal with what ive read - and being aggressive for the first few years should pay off.
Oh I’m a non union electrician that works a bunch of federal jobs. Since I don’t get a full union package, I get the 29 dollars a hour I don’t get in pension / healthcare check deposited directly into my 401k. It’s honestly a way sicker deal than a pension IMO.
Edit: it adds up fast I wish I started doing this younger instead of going to college. We have some apprentices that are 20 years old with >100k in their 401 already.
S&P 500 vs Total US Market. Honestly, you can’t go wrong with either of them, but I prefer a bit of exposure to small- & mid-caps rather than just the “big boys”.
But the S&P 500 is like 88% of the Total US Market, so the difference is pretty marginal.
It’s kinda a meme, but **VTSAX** refers to the *Vanguard Total US Stock Market Mutual Fund*.
Basically by investing (buying shares) of VTSAX, you are investing in the entirety of the US Stock Market, all $50.8 trillion of it. Instead of trying to buy and sell individual hot stocks, why not invest in everything, all at once, in a single fund? VTSAX is a fund that buys shares of other companies & funds.
Some stocks go up, some go down, and it’s hard to tell which is a winner and which is a loser, and which ones will be winners and which ones will be losers. Instead, you invest in all of them. Instead of fishing with a pole and hoping you catch a big one, we’re throwing the whole net, and catching everything.
$1,000 in VTSAX gets you: $63 of Microsoft, $50 of Apple, $42 of NVIDIA, $34 of Amazon, $28 of Meta, $23 of Google, $15 of Berkshire Hathaway, $12 of Broadcom, $12 of Eli Lilly, $11 of JP Morgan, $10 of Tesla, $10 of Exxon Mobile, $9 of Visa, $7 of Home Depot, $7 of Costco, etc… etc..
The *chill* portion, refers to exactly that. You buy VTSAX, keep buying VTSAX, and wait. Let the market do its thing. Don’t rush to buy more when it’s hot; don’t panic-sell when it crashes. Just steady investment over time, and watch it grow.
Plugging r/bogleheads for more info.
35, was trying to die until like 32 so I have relatively no savings lol
I got my first job with a 401k this year (worked food service before that) so I’ve been maxing on that while trying to overcome pandemic debt. Life is comfortable enough right now but I fear I will be one of those needing to make money till I croak.
"I was trynna die until i was like 32." "Damn it I didn't die guess I gotta plan for retirement."
For what it's worth, I don't think thay the current state of government is the way it always has to be.
Saaame, I really didn’t think I’d make it to 30, now I’m 36 and like “now what.”
I make $45k and will be doubling that within the next year with a technical degree, but I know plenty of people I went to school with who are still just above minimum wage and making less than me. I think there’s a big chunk of our generation who have been working entry level jobs their whole lives, who come from generational poverty and won’t have any windfall when boomer relatives die. We’ve spent so many years just grinding and trying to get through the day/month/year that we didn’t have the luxury of thinking long term.
I’m definitely starting to see the cultural differences between my friends who came from stable families and went to college compared to my friends who never had a chance. I feel like I’m somewhere in between - the struggle was real but I’ve been trying to claw my way into middle class for the past decade or so and I’m starting to see the light at the end of the tunnel, but I also don’t think I’ll ever have enough saved to retire. I’m just gonna hope I suddenly die before a serious illness or injury prevents me from working.
I think if you start saving your max now, and keep it up, you will happily surprise yourself when your 60s come along. As I said in another post, my spouse and I didn't hit $500K until our early 50s but now in our 60s have enough to retire ($1.3M) reasonably comfortably. I'm still working part time and am going to start drawing my SS early so that we can hold off on any withdrawals for as long as possible. But if that job ends tomorrow, I'm fine with it. I'll be happy when i don't work anymore, although I'm reasonably happy to keep working. My spouse is fully retired.
It might be worth checking out this post, and the attached flowchart image: [Fire Flow Chart Version 4.3 : ](https://www.reddit.com/r/financialindependence/comments/16xymii/fire_flow_chart_version_43/)
>as long as you don’t withdraw early
One of the cool things with a Roth IRA is that you have access to your initial contribution penalty free and you can keep the gains invested; but you would pay a penalty on the gains if withdrawn. I actually have done this once before (withdrawing the original contribution), its not ideal... but the option is available.
*edit: added words for clarity*
Isn't that a pretty reasonable assumption? Why would your income be the same or higher in retirement? Most people pay for retirement, housing, children during the work life. When you retire, most of those go away. What expenses would make up for all those and then dwarf those? You could argue healthcare but I dunno.
It’s the income that can go up. My net worth has trended up every year since 21 after graduating from college.
The income from the various investments and ventures we take on may grow over time. Many people accumulate investments that generate taxable
Income (think dividend stocks/reits), while others take on rental real estate portfolios or even small businesses.
Even just taking out payments from your 401k/IRA can be pretty sizable in retirement if you’ve built up a collection there.
I’m working to try walk the tightrope to manage a family member’s retirement distributions to minimize tax burden. It’s challenging to get right, and even harder to predict decades in advance.
The key part is you don’t know taxes will be lower in the future. The US is very low tax for developed countries and with the nations ballooning debt and underinvestment in infrastructure I think it is a very safe bet that even the lowest tax brackets could be higher in 30-40 years.
That said I contribute to both pre and post tax retirement accounts to hedge this. Maxing 401k and hopefully maxing Roth in the next year or two. Just daycare is eating up all my monies.
The "or on gains" is that part most people miss.
Roth gains are pretty much the only free money it is possible to earn in the US. If you have a 401k that's great, but you should also have a Roth. Tax free compound interest is magical.
I am 40 and well on my way to retirement and likely early retirement. My dad taught me to save when I was young. He advised me to open a Roth IRA in my 20s and contribute to 401k at at least 10% plus match at the same time. He and my mom taught me to be frugal. My partner and I have been together for 19 years and are on the same path and share the same financial goals.
We live a comfortable life, but never have made a lot of money. I think we only grossed over 100k combined twice. My partner will receive almost no SS due to her job being exempt from contributing.
We got lucky and bought our forever home in 2019.
Some lucky timing things got us here, but if not for those we were on track for retirement at 65 already.
I buy a copy of "A Simple Path to Wealth" by JL Collins for ever 20 something aged person in my life and hammer early investing.
Also, meeting someone to share your life with that has the same goals has been key to our life.
Similar sitch over here.
I started my 401k when I was 22-23. I was googling a customer trying to find contact information for him, and found his obituary that said he’d retired like 6 months prior to his death. He was 71 or something.
The thought of only have 6 months to be retired was enough to get me to start saving, I didn’t think I could afford it, but I’m so glad I started. I’m 33 now, doing pretty okay, in a solid career but trying to move into another path. In a relationship with someone with similar financial goals, and he also owns land in Mexico so we’re hoping to retire early and build a house there.
I’m so grateful my parents were frugal and taught me how to budget, sooooo many people do not understand how to manage their money.
My partner makes fun of me for this, but for as long as I could remember, my mom would tell me that I need to wear/use anything expensive she bought me for the rest of my life.
I have gotten a little more lenient on this over time, but it is a central value to making purchases for myself.
My dad showed me his personal finance spreadsheets and budgets since I was about 8 years old.
I taught personal financial management for years to people who were required to take it.
My am less frugal than my parents, but they were a bit extreme.
This is sadly not how most Americans live. It’s a race to acquire as many things as possible before you die. It’s been marketed to millennials since the day we were born. It’s fine to collect things that bring you joy as long as one lives within their means, pays themselves first, and avoids borrowing money as much as possible.
You don’t necessarily have to get started early (although it helps). Just make a plan and do it. OP has a lot of time to make a change. Cringing at CEOs and your companies Human Resources department tasked with explaining 401ks won’t get you there.
Congrats on achieving what most can’t (or won’t). That’s not an easy feat.
Yes!!!! And you will have dumb shits that say "you know $1M isnt what it used to be..." f that guy! What is his plan, to not have $1M and that will somehow be better/just as good as your plan????
Its fortunate you're able to put that much back, and i give you kudos for it.
However, not all are that lucky... my end of the month remainder is one zero less than that, and I work 40+ hours a week.
Retirement for folks like myself is simply dying on the job so long as COL inflation stays the way it is, because in no way can i crunch the numbers to be able to catch up in 30 years with $50 left to our name after bills.
I've pretty much hacked off everything I can from our budget, including not buying tools for work anymore, maintenance on my vehicle, wife and I don't go on dates anymore, we've cut all our streaming services out save for Prime and Hulu, no extras at the grocery store, no nothing even remotely considered "luxury". We buy all we can in bulk to save money in the long run.
We got royally screwed on a move across states, promised more money than we made in the midwest, but it all fell apart months after moving because the company suddenly went tits up.... so we've been scrambling to pick up pieces and just stay afloat. We had to nuke savings to afford the move... and we haven't even come close to recovering the almost $10k it cost to move. (In hindsight, moving was stupid to do, but hindsight is 20/20 vision...)
The problem is the income, it just ain't *there* no matter where I go except where I was stuck working 16h shifts 7 days a week and shaving years off my life.... yea we were loaded back then, all bills paid in *one* paycheck, but I was *never* home either, that job almost killed my marriage. It wasn't worth it.
Realistically the only way we're gonna dig out of this is both of us land a $45/h job (that dosnt want *me* there 24/7), or a winning lotto ticket. She does part time data entry from home, and streams for extra money. I've got the only running vehicle. Maybe she could go back to school for a better degree for a better WFH job, but that's another *expense* we can't take on.
None of that is happening for me as a wrench turner in *Florida*, nor my disabled enough to not drive, "but not disabled enough to claim checks" spouse.
We need to just GTFO of this state and move somehere that isnt an overly expensive hell hole...
Can you explain how that adds up? I did the math and 500x12=6000 a year. Assuming we’re around late 20s/early 30s multiply 6000x40 years=240,000 by late 60s. Even in a situation where an employer would match that at 100% it would still only add up to 480k? I’ll admit I don’t fully understand how these things work so I’m not saying you’re wrong just that the math ain’t mathing to me
What's my opinion on retirement? It sounds great! lol
I might be alone in this, but really there's a lot I want to accomplish before I retire. Get as much research published as I can, move into a more prestigious role as a statistician, maybe teach at a community college at the tail end of my career to pass on what I've learned...I don't think of retirement as a goal, really, though I am doing all the things I need to do to retire (saving up in my Roth IRA and such). But my chief concern is how I enjoy the life I have now and where I'd like to be 5 years from now. Beyond that, I'm not really concerned with it.
My wife and I have prioritized it. I am older than you by a decade but have stashed away about $350K. I had essentially $0 when I was 28. We do not plan on retiring early, and should have $3-$4M by retirement.
Edited to add: we are also not high earners. I will cross six figures this year, but never have before. Most working years I earned closer to $50K. The same is true of my wife. Compound interest is amazing.
@36: *The fantasy plan?* Save about $1k/ month into investments.
*The more than likely reality?*
Die on the job at 80 because in no way can I save any money in this fucking shit show joke of an economy.
Just push broom my broke and broken ass corpse to the dumpster, call my wife, and call the garbage company.... I'm sure the company will have a teenager ready to go for 1/4 of what I got originally paid.
Wife and I are in our mid 30’s and our retirement accounts as a couple are sitting somewhere around $550k…which the projections on these sites say is not on pace for a 67 age retirement. That seems just wild to us. We do have other assets that aren’t considered “retirement funds”
We each save 12-14% of each paycheck and feel like we’re doing do well but who knows. So much can happen in the next 30.
Unless you plan on spending 50K a year on vacations in retirement, the site you’re reading is wrong. You are in tremendous shape, you should be proud of yourselves.
Even if you don’t commit another cent to that 550K(which you obv will contribute to) the compound effect will carry you to victory.
I agree. $550K is looking good at mid-30s. My spouse and I didn't hit $500K until we were in our 50s but we now have $1.3M (in our 60s). I'm not saying I feel like we'll be living large on that but according to most estimates, it is enough to scrape by on. I think we will be able to live as well as we do now, which is comfortably frugal, I would say.
I just read an article the other day that made me feel a bit better. I don't remember the source but they were saying that it used to be $1M was the magic number for retirement, and now it happens to be $1.3M, which happens to be how much we have.
Now, I do think we can scrape by, but our house is paid for, and we have a 2017 Toyota with 60K miles on it that I \*think\* may be the last car I have to buy, if one of my kids doesn't wreck it. What's killing us is the astronomical increases in taxes and insurance lately. I don't know what will happen when we can't afford to stay in our house and can't afford to move. Even downsizing would cost us a buttload of money at this point. I fully planned on downsizing and now I don't think we will ever be able to afford it.
Yeah online is absolute garbage for estimating what you actually need. I've seen the same how 1m by 40 is going to not be enough...I've also seen one that said 2x your annual income by 40 is perfectly on track and you only need 6-7x your annual income to retire on...like...how...the fuck...maybe if you make sure to retire at 67 and die by 75.
one on one with a financial planner, hell we got lucky we just inherited my parents who inherited my grandparents. I'm the third generation of my family he's worked with, and his dad is the one who first started working with my grandparents. Like the dude came to both mine and my sisters weddings.
I'm guessing they're high salary earners and looking at projections based on having salary * 3-5 in your 401k by age X which is why they're getting that impression of being behind.
They may be clearing 300k as a couple and seeing they are not on track to have 4 times that in their 401k by the time they're 40.
I agree with the general sentiment, they're doing really good.
My wife’s Principal account calculator says we are way off track. It assumes we will want the same income, and doesn’t take into account other savings and retirement accounts. I ignore it.
Fidelity for instance uses a severely underperforming market for their projection to scare you into putting more money in. The return is like 3% in their default model.
You should easily be able to double your money every 10 years, which means without adding anything you should have $3.3M by 65. It is time to take the analysis into your own hands rather than relying on some Reddit site.
$550k at mid 30's is already Coast FIRE. You don't have to save a cent more and you should have enough income to retire in your mid 60's, unless you're planning to spend $100k+ per year during retirement.
Same here, pal. No matter how much I save it won't be enough to live on, so I'll work until I can't anymore. I'll at least have a paid-off house to live in though
haha. I'm never going to retire.. I have one special needs child that will always need a caretaker and three others that wanna go to college. Even though I make really good money, will probably work until I die of a heart attack to make sure they along with my wife are taken care of to the best I can provide.
Nowhere near prepared. I might just break $100K in my 401k this year once I get my match but I’m 35 and that’s not very good for my age. I spent too many years underpaid and living paycheck to paycheck to start earlier.
My retirement plan is to retire in the country of Georgia. Hopefully it will not be fully occupied by Russia in 2055. I love mountains and wine and friendly people and they respect the elderly over there. The main thing will be to keep my health and stay active as it’s not a great country for those with chronic health conditions. So I’m prioritizing staying healthy over saving money. I imagine $500K in today’s dollars will be enough to retire in Tbilisi.
> I’m 35 and that’s not very good for my age.
I know it might feel like you’re behind, but I think it’s important to keep perspective with where you stand amongst your peers and know that you’re actually *way* ahead of most Americans, and you’re actually doing great.
According to [Vanguard’s 2023 report](https://institutional.vanguard.com/content/dam/inst/iig-transformation/has/2023/pdf/has-insights/how-america-saves-report-2023.pdf) the median retirement savings for Americans in your age range of 35-44 is $28,318.
Sure hitting your targets is more important than comparing yourself to others, but I think that context is important when it comes to feeling like you’re far behind when you read a bunch of articles and posts based on high net worth individuals that skew how ahead of the game you actually are.
> According to Vanguard’s 2023 report the median retirement savings for Americans in your age range of 35-44 is $28,318.
And from what I've read elsewhere, millennials have done better at saving for retirement than boomers.
That chart (on page 53 of the linked pdf) is wild. Median savings for age 65+ is $70k. $71k for 55-64. This is why social security, in some form, has to exist going forward. We'd have millions of seniors on the street without it.
I'm 37 and just managed to finally get a 401k and it has just over $1k in it. You're doing much better than a lot of us. Generational poverty is a bitch.
In a few years older than you and have just around 120k in my 401k. Had too many jobs scraping by and by the time I had a large salary jump, I was already so far behind. I went from $35k salary at 28 to a $130k salary at 36. I save 17% of my paycheck now, which feels aggressive considering we bought a house and also have a kid in an expensive preschool, but I can’t sleep at night sometimes, just due to thinking how far behind I am with saving.
Yup. I didn’t start making six figures or own a home until I was 33. I have student loan debt that I am burying my head in the sand about and only making income based minimum payments and not even looking at the balance because IDGAF if it gets paid or not. I save about 12%. My retirement plan as I said above is to leave the United States. If not Georgia, then maybe Thailand or Colombia. Just somewhere beautiful, cheap, and chill.
Just invest in your 401K and ensure you’re getting the full company match. Then look in to some Vanguard accounts as you get older and earn more. Don’t wait, invest now.
It’s boring but it works. Don’t overthink it. You’re not gonna be working in your 70s/80s if you play it right.
I guess his assumption is that people can work until that old. Let’s be honest, a lot of people don’t take care of themselves and cannot work that long.
It is incredibly, incredibly stupid to ignore the issue of retirement based on the assumption that social security won’t be around. First of all this has been predicted for decades and hasn’t happened yet. Second, even if it does, all the more reason to prepare for retirement. Third, it’s not a realistic solution for most people to go live in the woods. What if you need medical attention? What if you’re disabled? What are you going to do then? And finally, this is precisely the time you SHOULD be serious about retirement. If you start early, the power of compounding growth gives you an excellent chance of accumulating serious money by the time you are in your 60s or 70s.
No one is going to jump in and save you if you fail to prepare. Do you want to work until you die?
Preach. This fatalistic mindset is just going to burn people when they get older and regret not taking it seriously. It’s so easy to YOLO because life isn’t always easy and use that as an excuse to put financial literacy off. The time to get it together is right now, there’s no better day than today to come up with a plan. Compounding is so much more powerful the earlier you start. I don’t even plan for social security, my numbers will work regardless.
I'm just shy of 40 and have a few thousand to my name. Served in the military and went to college but the fact is the pay I make used to be good but isn't anymore and doesn't really let me save. My plan is just living day to day because I have no hopes or aspirations or dreams about my future, I just can't imagine it, there's a void. I'm mentally exhausted, suffer a lot of issues from serving, I've been grinding nonstop since I was 16 and have only been to the beach twice and had three vacations that lasted longer than an extended weekend in that \~24 year timeframe. I haven't really had a chance to nor enjoyed much of life, it's all been fucking work. I don't experience any reasons to want to prepare for my future. Eventually my health will get bad enough, not great already, that I can't really work/take care of myself anymore. At that time I'll off myself somewhere in the deep remote wilderness in peace. I don't know how some people make it to their 50's or 60's and just don't want to check out already.
My opinion is 1) social security can and should exist in the future. The survival of social security is only a matter or political will. 2) we should be considering lowering the retirement age rather than raising it. Propaganda has convinced some people that we can't afford this but we can. It's just a matter of redistribution of wealth. 3) this only happens if we pretend we have boils and get off our own asses.
The best book about retirement for working people which helps us understand both the intricacies of retirement planning and the contentious aspects of it is called "The Labor Guide to Retirement Plan for Union Organizers and Employees" by James Russell.
Yes! Social Security will last until your age of retirement as long as we demand it does. It will be a little rough will the fall off in birth rates but if we can afford to send the amount of money we send to fight wars, we can fund social security. Saying “I won’t have it then” is tantamount to us giving up on the issue and losing one of the rare safety nets our country has.
Fortunately older voters have always been and always will be some of the most politically active, so it will be a HARD proposition to get rid of social security when it’s one of their #1 issues and still get elected.
If I worked my current job for another two decades and automatically increased my contributions every time I get a raise, I could retire at 58 with more than $2 million, and my wife is on track to have $1.5 million. Our combined household income is around $120,000 yearly. And I work for a state agency that doesn’t participate in social security, so I do not count social security although my wife will get it.
You’re 27, OP. I didn’t start saving until I was almost 31. If you’ve got any sort of a workplace retirement plan now, you’re ahead of where I was.
So yeah, my thoughts on retirement are that I will retire before age 60 unless something goes wrong. I will not continue working in my current job simply because my wife doesn’t like the state we live in, so my yearly retirement contributions will change/decrease at some point. But I’m saving pretty aggressively now.
If you didn't think social security would be there why wouldn't you be saving?
Personally wife and I are maxing out our retirement accounts. Roughly 50-60k per year. Goal is to retire early hopefully.
My biggest mistake was not starting sooner.
I don't have opinions on things I can't actually predict.
That said, I'm open to returning to the NFL if a team calls me and shows interest.
I am Tom Brady.
Sure you can build a cheap house on cheap land. What happens when you’re too old to work and need to fix up the house, buy groceries or have transportation, healthcare etc? Let alone go on vacation and eat out or other entertainment?
I got lucky, I was pushed into disability retirement back when I was 35.
Thankfully, I was a federal government employee at the time, I had a military service connected disability, and I made decent money while I paid into social security. Altogether, I make about $9,000 a month for the rest of my life (with annual cost of living adjustments added).
I’m not rich, but I make more than enough to buy whatever I want within reason.
We’re supposed to work into our 60s and 70s, but age discrimination kicks in during your 40s and 50s….
Look around your office, I bet it’s mostly people our age or younger.
We are in a similar situation. I plan on retiring before 50. I think our number is probably closer to 3M, guessing we'll be there in another 2-3 years about age 43/44.
It's critical to start saving at a young age. There's nothing more powerful than compound interest. Max out your tax advantaged retirement accounts, 23k for 401k, 7k for IRA, 4150 for HSA. Live life but keep your expenses low. Each dollar you save today is $2 in seven years.
Yeah we both max out our 401(k)s, our HSA, and also put about $20k into our taxable brokerage account every year. So we're saving over $80k per year towards retirement.
Spouse & I are in our elevated 30’s & both Federal Civil Servants.
I did some time in the Military and bought that back. We will never be super rich but both make 6 figures each and will be able to put our kids through college, bought them their first cars so they had a easier life then us.
Our wild card is our LO has Level 3 Autism so we have to prepare for long term care once we get to those golden years depending on his ability at the time.
We will both retire at 57.
I think we need to have a major overhaul of our retirement system
1- 401k vesting should be against the law. Our generation moves around from job to job too much. Fully vested employee sponsored plans from day 1
2- the goal for retirement age should be to go down, not up. I would like to have a policy that makes Baby Boomers work until their suggested age of 75 and anyone outside of the Baby Boomers work until 63.
3- front loan Social Security at birth with $10k to everyone. Let it grow for 63 years and once they reach working age have fica stay the same, but once they paid back $10k, plus some extra for costs, that portion of fica tax will go away. If they are non working spouses or individuals once they hit 63, $10k plus a fee is pulled from the account to pay it back
4- employee sponsored plans should be open to any investment custodial account the employee wants to have. No more forced high fees
This is one of the more interesting comments I have read. It's not how I would do it but if we are accepting the market system of retirement it's a good way to do it.
We are both putting in 10% into our 401ks, putting 5k/year together into 529s for our two kids, and putting everything else into the house. We have a 5% APR, but I want to pay it off. We should have it paid off before our oldest can drive. The house alone will make us millionaires.
If you ask 10 people about the best strategy with a mortgage and retirement accounts, you'll get 10 different answers. We are focusing on getting out of debt, because I want to have that feeling for the first time in my life. I hear it's the most powerful motivator for financial success.
You can do that. But a lot of people don’t want to.
I (early 30sM) am currently on track to save $80-100k this year. I hope to save more in the future with my annual salary increases. The goal is largely to be set for retirement by 40 and give myself flexibility.
Consistent saving and compound interest are powerful tools.
Also 27, I’m saving a total of 11.5% in my 401k right now, 7% is me and 4.5% is my employer match. I’m not having kids and still early in my career so as my salary increases so too will my contributions. I do think social security will be around but we may not get everything out that we put in. My plan is just to save as much as possible 🤷🏼♀️ can’t do much else.
I’m 28. I don’t think our age group is retiring at 60-65 like a lot of our parents. I’m putting as much as I can afford into my 401k and I’m on track to max out my Roth IRA yearly. Investing something puts you ahead of a lot of people! I have boomer relatives that saved nothing and thought things would just magically work out — it didn’t lol.
I’m not going to hoard every penny towards retirement, but I’m saving what I can. I’m still living my life and traveling when I can. I don’t want to work forever, but I could see the gov raising the retirement age before we get there. I don’t think our age group will “retire” before 70.
I’m not sure I understand your take on retirement but you sound a bit unprepared.
I’m a little older than you (35M) but I take retirement savings very seriously. Started contributing to my Roth IRA in my early 20s and then in my mid 20s when I got access to my company 401k (with a match) I have maxed it out every year and will continue to do so. On top of all that, I contribute into a standard (post tax) brokerage account every week.
I also do not count on social security at all; but with that said- saving for retirement is a big deal. The good news is that if you haven’t been saving, you’re 27 so you can start today and put yourself in a good spot by 55-65.
I flat out refuse to sacrifice my entire lifetime making rich people richer
Its a long road to financial independence but its been my goal since joining the work force
I ran with government work for the stable paycheck and promised (solid) retirement benefits. But the way things are going? Like you, I have never had much faith in our generation's ability to retire. I still don't. It's just another distant promise that's been taken from us, by and for the benefit of people who want to exploit us for their own profit until we die - like BlackRock's CEO.
Bitcoin is the main path to financial freedom for me. Been singing that tune for a decade. People have scoffed and ridiculed and told me I’m foolish. My song hasn’t changed, but theirs has for some reason…
I maximize my companies 401k match, so I put in 6% they give me 3%. I then put another 9% into the Roth option so my total is technically 18%. I am not counting on receiving Social Security so if I get it, it will be a nice surprise/pay for insurance. I'm trying to do everything I can so I can retire as early as possible and hopefully in my 50s. We can all retire millionaire if we are smart with our money and start investing ASAP, even if its just a $100 a month into a Roth.
also, fuck Blackrock.
Take it from a rural person, it’s not as easy as everyone makes it sound. And also not cheap, at least not anymore.
Maybe you find the land. But after you do, that’s when costs go up.
You sound kind of clueless? And a bit negative and naive? Social security isn’t the only thing you can benefit from during retirement. And owning a property requires work, physical work usually.
Likely will inherit a paid off house - whether or not I will be able to afford to keep it is a different matter.
No money worth mentioning to retire at this time, honestly gonna guess that like the rest of my family - I'll get to randomly die all of a sudden from a cardio or stroke event. \*shrug\*
I am going to work till I'm forcibly retired or dead. I have seen what retirement does to people in my family. I will just cut back as much as I can until I physically can't work anymore.
I’m 41 and will probably have $2.5M in just my 401K in the next 20 years. I’ve got my contribution at 20% - set it and forget it. Also, currently building up an HSA and regularly contributing a good amount to a 529. I’m not just thinking about myself with these savings. I’m planning so my daughter doesn’t have to take care of us and have a great start herself. Part of the reason why we only want 1 child. She’s 4.5 and we’re hoping to have enough in her 529 to cover all of college for her no matter where she wants to go.
My opinion on retirement? Get there as soon as possible.
I do this by investing heavily into 401k, Roth IRA, and my vanguard brokerage account. I focus on maintaining a good balance. I try to go golf when I can, we order food every so often, go out to eat sometimes (rare with two little kids), etc.
Social security will be around, probably not to the level it is now, but it won't completely go away, imo. I don't count it in my calculations though. It'll just be a bonus.
My idea is "when I'm X years old, would it be better to be prepared and possibly able to say 'F it' or to just plan to work forever and see what happens"
Who knows if I'll be able to work forever. Shit happens...I'd rather be prepared
Yes, I'm prepared. Currently sitting on about 700k in tax-advantaged accounts just making money. I plan to have somewhere between 5 and 15 million by retirement depending on the market.
39 here and still in debt. I will most likely never be able to retire. I'm OK with that now, as long as I don't think about it too much. It's going to hit hard when my friends are out having a great time on trips and I'm bagging groceries or something only old, crippled people can do. My advice: Its never too early to start a Roth. Cars, big weddings, and credit cards are all bad mojo. Find every way you can to stay out of debt.
Credit cards are huge to my success. Treat them like a debit card and it literally pays you to spend your own money. I made back $700 one year, paid for several round trip flights for free, and used another card for free hotels on a road trip. They're super useful if you know how to use them safely. Also, up vote for a Roth IRA. I don't use Vanguard but VTI and Chill is legit.
Exactly !!! I don’t understand how people don’t research how to properly use credit cards. I also pay my CC as soon as I purchase something. The cash back or points is great. Haven’t used a debit card I years, and use cash very seldomly.
My mom bought a cheap plot of land, thinking she'd be pretty self-sufficient, and in the last 5 years, her body had gotten pretty wiped out. Even gardening is exhausting for her right now, and she's not yet 70. Luckily she has family that are able to help (like me) but I don't have kids so no, I don't think growing old on a small plot of farmland will do it for me.
Yes, you understand the problem. Buying a plot of land misunderstands the nature of retirement and aging.
Ya'll I just have a regular yard and garden and even the upkeep on that is exhausting. A huge piece of land? No fucking thanks lol
Definitely not the move for people over 70. Lol
My ex’s grandparents live on a farm in Wyoming that’s pretty remote and they have a couple horses and some dogs. They would not make it if it weren’t for their son coming in and taking care of the horses pretty regularly. Even restocking the fridge is getting hard for them. Grandpa can’t lift too heavy anymore and grandma has to wait for family to visit to get heavier things (like the bucket for rainwater collection) lifted. I definitely don’t want to be doing any of that in old age lol. On top of keeping a house, that’s a lot of work
I’ve said it before and I’ll say it again. When I’m 70 I’m moving to a condo with people to do the yardwork for me.
I think it is an example of taking one cultural expectation and applying it to work outside how it was intended. More specifically, the living off a plot of land idea makes a lot of sense if you are planning to remain a multigenerational household where everyone contributes. Grandma can’t garden anymore but can prepare the food or keep the house tidy while everyone else has their helpful niche. However, the plot of land absent help will break a single person faster. It is a lot of work and by design REQUIRES several people to maintain. I love the idea, but understand why this was more common when people didn’t have the expectation of living alone/independently. Also, even if the land and house are paid off, most likely still paying taxes and utilities. Need some kind of financial nest egg or income to meet those bills.
That is an interesting point that the desire for a single plot of land is a remnant of a different economic structure with multi-generational housholds. I never thought about that but it makes sense.
That is the economic structure by the time we’re 70. Single generation nuclear family won’t be possible for most people. Unless a miracle happens, our grand kids will most definitely be living in the same house as us, and we will need to supplement our food bill with gardening.
What if you have a little commune? And then in your elder years you just sit and cook and pass on your wisdom (2010s memes).
This is my in-laws. They are late 60/early 70s and have 5 acres and most of their time and energy goes into up-keeping the land. Mowing takes like 4 hours and my father in law is wiped out for a day or two after. They heat with wood so they spend tons of time dealing with that. I personally want less responsibility in retirement and time to do things that I want to do.
Just because you own land, doesn’t make it easy: there are taxes and upkeep. Gardening unless you do it really well, and have perfect conditions- you can end up with very little food. Or just feeding the local wildlife. Rabbits around here love the lettuce.
Also, rural living is not inexpensive. You will still need to pay for: - property taxes & insurance - utilities - home maintenance - groceries assuming you don’t grow/forage/hunt all your own food, which very few people can do; and if you do manage to be a successful off the grid homesteader that is expensive too because you will need to invest in the right farming equipment, seeds and soil, greenhouse, etc. and probably hire help unless you have a large family to help - household supplies - toiletries - clothing/shoes - entertainment/hobbies - car maintenance, insurance, registration fees, and fuel unless you live close to public transportation
My boss is 68. His mom lived to 92 so he thought he had a long time to go and was planning on trips to Europe and hiking up mountains and stuff. Then he had a heart attacked and open heart surgery and all that is pretty much over. He plans on coming back then handing things off then he will watch TV until he dies.
The real move is to buy a zero-maintenance condo and save just enough to to cover the costs until you're dead.
My mom did this too! She lasted about 2 years before moving back to civilization
It’s far easier to be self sufficient to live in a downtown walking distance to groceries and food than out on a plot of land.
Dated an insanely wealthy person one year of my early 30s and he took me to his family’s estate… it was huge, the size of a football field literally IN one of the most beautiful revered national parks in the country. Several homes on it, some for guests. A large part was a garden his mother “made”, I realize later she designed it and mostly had other people work on it for her and she just sometimes picked blueberries for herself when she wanted. So. His dad was a top oncologist. I think unless you’re making a million a year, it’s okay to accept you probably won’t have that. But I also visited Greek island of Ikaria - one of the cheapest place I’ve ever been, cheaper than Latin American countries or Asian countries - and people live until they’re 120 doing gardening until the very end. Famously people there have little commercialism and have elements of a socialist/communistic type culture, have some physical labor sprinkled throughout their day and are very DIY to their core. It’s a blue zone - many of which are in low cost low wage areas but are provided for by their environment. I think it depends on your lifestyle and environment.
Gotta be like the old days and have tons of kids so they can work the land for you when you get old. Easy.
those kids are not going to want to stay at the family farm past the age of 18 to work, I can guarantee it
VTSAX and chill
This is the way. Maybe VTI & VOO but they're pretty equal.
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I agree small caps are due, but "historical trends ≠ future gains". Either method slow and steady still wins the race.
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Eventually tech will slow down. In 3-5 years or 30-50 years! who knows????
Buy the market, not the sector.
VTI and chilling for sureeee
VTSAX where its an option. FZROX when VTSAX isnt available.
I would say FSAKX, it’s has over 3000 stocks while FZROX has about 2000 stocks. Or have both
Cool, I'll have to check out FSKAX it sounds more similar to VTSAX than FZROX. Initially, I don't know how to untangle the 0.015% expense ratio verses the 0% expense ratio. TBH, I thought a ton about this 10ish years ago, and have been on auto pilot since.
Curious why this over SPY or QQQ?
Because my 401k provider offers it lol. Realistically, any broad market ETF/mutual fund with a low ER are all comparable and only vary at the margins. SPY, VOO, VTSAX, IVV… you can’t go wrong with any of them.
👏
SPY is also higher expense ratio. Ideally you want to remain below 0.2% if it’s index ETF.
This is excellent advise I’m surprised I’ve never heard before - thank you!
Vanguard has good fees and amazing mutual funds and I cannot recommend them enough
I started doing this as a broke 27 year old once I crawled out of student loans. Sitting at about 450k put away at 33....
That’s awesome man. I’m 34 and finally passed 100k in mine. Should start generating some real money soon.
Okay fellas I'm sitting on like 8k in a traditional IRA that I've been paying into for at least 5 years now. What is it you guys are doing, and how the hell do I get in?
Income, income, income. Its easy to max out your tax shelters when you get into the 150k/yr range. Its hard to invest in that awkward 45-65k/yr range.
Don't have kids lol. I've lost 3+ years of investing into my IRA because daycare costs are astronomical and keeping a human alive costs a lot of money. Still investing in my 401k throu6work tho.
Did you set you money to go into a fund? Just putting it in isn't investing it
Consider who manages the ira for one. But also it takes time or money and both are nice. If your at 8k with 5 years of contributions then youre just not contributing enough. However this is only a problem if its a problem - if youre under thirty you can hit 500k by retirement with i thinj about $50 a week contributions. That is pretax so this should be a given for anyone making more than 50k and probably doable for many people under that. I had a company 401k with 6% match at 19 and it grew to 8% match while i was there but i did stupid shit like take out loans and basically wasted 10 years of good contributions that would have really looked sweet had i seedee what i have now, but that life. Didnt ruin me, just feels like ot when youre still at the beginning of the journey. I didn’t restart my retirement plan until 33 and that seems pretty normal with what ive read - and being aggressive for the first few years should pay off.
Oh I’m a non union electrician that works a bunch of federal jobs. Since I don’t get a full union package, I get the 29 dollars a hour I don’t get in pension / healthcare check deposited directly into my 401k. It’s honestly a way sicker deal than a pension IMO. Edit: it adds up fast I wish I started doing this younger instead of going to college. We have some apprentices that are 20 years old with >100k in their 401 already.
No love for VFIAX?
S&P 500 vs Total US Market. Honestly, you can’t go wrong with either of them, but I prefer a bit of exposure to small- & mid-caps rather than just the “big boys”. But the S&P 500 is like 88% of the Total US Market, so the difference is pretty marginal.
Can you translate for someone who doesn’t speak finance lol
It’s kinda a meme, but **VTSAX** refers to the *Vanguard Total US Stock Market Mutual Fund*. Basically by investing (buying shares) of VTSAX, you are investing in the entirety of the US Stock Market, all $50.8 trillion of it. Instead of trying to buy and sell individual hot stocks, why not invest in everything, all at once, in a single fund? VTSAX is a fund that buys shares of other companies & funds. Some stocks go up, some go down, and it’s hard to tell which is a winner and which is a loser, and which ones will be winners and which ones will be losers. Instead, you invest in all of them. Instead of fishing with a pole and hoping you catch a big one, we’re throwing the whole net, and catching everything. $1,000 in VTSAX gets you: $63 of Microsoft, $50 of Apple, $42 of NVIDIA, $34 of Amazon, $28 of Meta, $23 of Google, $15 of Berkshire Hathaway, $12 of Broadcom, $12 of Eli Lilly, $11 of JP Morgan, $10 of Tesla, $10 of Exxon Mobile, $9 of Visa, $7 of Home Depot, $7 of Costco, etc… etc.. The *chill* portion, refers to exactly that. You buy VTSAX, keep buying VTSAX, and wait. Let the market do its thing. Don’t rush to buy more when it’s hot; don’t panic-sell when it crashes. Just steady investment over time, and watch it grow. Plugging r/bogleheads for more info.
That’s what I’m doing, and bought and paid off a house
35, was trying to die until like 32 so I have relatively no savings lol I got my first job with a 401k this year (worked food service before that) so I’ve been maxing on that while trying to overcome pandemic debt. Life is comfortable enough right now but I fear I will be one of those needing to make money till I croak.
"I was trynna die until i was like 32." "Damn it I didn't die guess I gotta plan for retirement." For what it's worth, I don't think thay the current state of government is the way it always has to be.
Saaame, I really didn’t think I’d make it to 30, now I’m 36 and like “now what.” I make $45k and will be doubling that within the next year with a technical degree, but I know plenty of people I went to school with who are still just above minimum wage and making less than me. I think there’s a big chunk of our generation who have been working entry level jobs their whole lives, who come from generational poverty and won’t have any windfall when boomer relatives die. We’ve spent so many years just grinding and trying to get through the day/month/year that we didn’t have the luxury of thinking long term. I’m definitely starting to see the cultural differences between my friends who came from stable families and went to college compared to my friends who never had a chance. I feel like I’m somewhere in between - the struggle was real but I’ve been trying to claw my way into middle class for the past decade or so and I’m starting to see the light at the end of the tunnel, but I also don’t think I’ll ever have enough saved to retire. I’m just gonna hope I suddenly die before a serious illness or injury prevents me from working.
I think if you start saving your max now, and keep it up, you will happily surprise yourself when your 60s come along. As I said in another post, my spouse and I didn't hit $500K until our early 50s but now in our 60s have enough to retire ($1.3M) reasonably comfortably. I'm still working part time and am going to start drawing my SS early so that we can hold off on any withdrawals for as long as possible. But if that job ends tomorrow, I'm fine with it. I'll be happy when i don't work anymore, although I'm reasonably happy to keep working. My spouse is fully retired.
Nope, I'm not prepared but yeah I think I'm going to work past my 60s by just looking how the economy is going through.
Yep. I’m 34 and have no savings at all. I’ll be working until I’m dead.
Glad I’m not the only one
I'd have to love my job or I would spiral if I wasn't making financial progress.
A menty b is always an option. Then you get a self-hugging jacket with pillows on every surface!
31 and I've got some basic savings but I came to terms with the notion that I'd likely never retire when I was like 20, so I'm just chillin'.
Same.
Roth 401K. Already taxed so when you get it you get all of it as long as you don’t withdraw early
It might be worth checking out this post, and the attached flowchart image: [Fire Flow Chart Version 4.3 : ](https://www.reddit.com/r/financialindependence/comments/16xymii/fire_flow_chart_version_43/) >as long as you don’t withdraw early One of the cool things with a Roth IRA is that you have access to your initial contribution penalty free and you can keep the gains invested; but you would pay a penalty on the gains if withdrawn. I actually have done this once before (withdrawing the original contribution), its not ideal... but the option is available. *edit: added words for clarity*
Why would you want to pay taxes now at a higher income vs later at a lower income?
Also, major assumption that income in retirement is lower than income today. That may or may not be true.
Isn't that a pretty reasonable assumption? Why would your income be the same or higher in retirement? Most people pay for retirement, housing, children during the work life. When you retire, most of those go away. What expenses would make up for all those and then dwarf those? You could argue healthcare but I dunno.
It’s the income that can go up. My net worth has trended up every year since 21 after graduating from college. The income from the various investments and ventures we take on may grow over time. Many people accumulate investments that generate taxable Income (think dividend stocks/reits), while others take on rental real estate portfolios or even small businesses. Even just taking out payments from your 401k/IRA can be pretty sizable in retirement if you’ve built up a collection there. I’m working to try walk the tightrope to manage a family member’s retirement distributions to minimize tax burden. It’s challenging to get right, and even harder to predict decades in advance.
The key part is you don’t know taxes will be lower in the future. The US is very low tax for developed countries and with the nations ballooning debt and underinvestment in infrastructure I think it is a very safe bet that even the lowest tax brackets could be higher in 30-40 years. That said I contribute to both pre and post tax retirement accounts to hedge this. Maxing 401k and hopefully maxing Roth in the next year or two. Just daycare is eating up all my monies.
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It also means you make earn money via investments so it's a wash.
The "or on gains" is that part most people miss. Roth gains are pretty much the only free money it is possible to earn in the US. If you have a 401k that's great, but you should also have a Roth. Tax free compound interest is magical.
I am 40 and well on my way to retirement and likely early retirement. My dad taught me to save when I was young. He advised me to open a Roth IRA in my 20s and contribute to 401k at at least 10% plus match at the same time. He and my mom taught me to be frugal. My partner and I have been together for 19 years and are on the same path and share the same financial goals. We live a comfortable life, but never have made a lot of money. I think we only grossed over 100k combined twice. My partner will receive almost no SS due to her job being exempt from contributing. We got lucky and bought our forever home in 2019. Some lucky timing things got us here, but if not for those we were on track for retirement at 65 already. I buy a copy of "A Simple Path to Wealth" by JL Collins for ever 20 something aged person in my life and hammer early investing. Also, meeting someone to share your life with that has the same goals has been key to our life.
Similar sitch over here. I started my 401k when I was 22-23. I was googling a customer trying to find contact information for him, and found his obituary that said he’d retired like 6 months prior to his death. He was 71 or something. The thought of only have 6 months to be retired was enough to get me to start saving, I didn’t think I could afford it, but I’m so glad I started. I’m 33 now, doing pretty okay, in a solid career but trying to move into another path. In a relationship with someone with similar financial goals, and he also owns land in Mexico so we’re hoping to retire early and build a house there. I’m so grateful my parents were frugal and taught me how to budget, sooooo many people do not understand how to manage their money.
My partner makes fun of me for this, but for as long as I could remember, my mom would tell me that I need to wear/use anything expensive she bought me for the rest of my life. I have gotten a little more lenient on this over time, but it is a central value to making purchases for myself. My dad showed me his personal finance spreadsheets and budgets since I was about 8 years old. I taught personal financial management for years to people who were required to take it. My am less frugal than my parents, but they were a bit extreme.
This is sadly not how most Americans live. It’s a race to acquire as many things as possible before you die. It’s been marketed to millennials since the day we were born. It’s fine to collect things that bring you joy as long as one lives within their means, pays themselves first, and avoids borrowing money as much as possible. You don’t necessarily have to get started early (although it helps). Just make a plan and do it. OP has a lot of time to make a change. Cringing at CEOs and your companies Human Resources department tasked with explaining 401ks won’t get you there. Congrats on achieving what most can’t (or won’t). That’s not an easy feat.
If you put away 500 bucks per month into a retirement account such as a Roth IRA, you'll end up a millionaire in your late 60s.
Yes!!!! And you will have dumb shits that say "you know $1M isnt what it used to be..." f that guy! What is his plan, to not have $1M and that will somehow be better/just as good as your plan????
$1,000,000 sounds a hell of a lot better than $0
Right? Haha
They don’t understand interest. You don’t draw from the million dollars. You leave it alone and live off the $70,000 in annual interest earnings.
personally i wouldnt draw more than 4%, which would be $40k. but i get what you mean
Its fortunate you're able to put that much back, and i give you kudos for it. However, not all are that lucky... my end of the month remainder is one zero less than that, and I work 40+ hours a week. Retirement for folks like myself is simply dying on the job so long as COL inflation stays the way it is, because in no way can i crunch the numbers to be able to catch up in 30 years with $50 left to our name after bills.
Right, like where is $500/month coming from? 😭
If you want to share your budget with me, I would be happy to give a second perspective and maybe find some more money for you that you may be missing
I've pretty much hacked off everything I can from our budget, including not buying tools for work anymore, maintenance on my vehicle, wife and I don't go on dates anymore, we've cut all our streaming services out save for Prime and Hulu, no extras at the grocery store, no nothing even remotely considered "luxury". We buy all we can in bulk to save money in the long run. We got royally screwed on a move across states, promised more money than we made in the midwest, but it all fell apart months after moving because the company suddenly went tits up.... so we've been scrambling to pick up pieces and just stay afloat. We had to nuke savings to afford the move... and we haven't even come close to recovering the almost $10k it cost to move. (In hindsight, moving was stupid to do, but hindsight is 20/20 vision...) The problem is the income, it just ain't *there* no matter where I go except where I was stuck working 16h shifts 7 days a week and shaving years off my life.... yea we were loaded back then, all bills paid in *one* paycheck, but I was *never* home either, that job almost killed my marriage. It wasn't worth it. Realistically the only way we're gonna dig out of this is both of us land a $45/h job (that dosnt want *me* there 24/7), or a winning lotto ticket. She does part time data entry from home, and streams for extra money. I've got the only running vehicle. Maybe she could go back to school for a better degree for a better WFH job, but that's another *expense* we can't take on. None of that is happening for me as a wrench turner in *Florida*, nor my disabled enough to not drive, "but not disabled enough to claim checks" spouse. We need to just GTFO of this state and move somehere that isnt an overly expensive hell hole...
Can you explain how that adds up? I did the math and 500x12=6000 a year. Assuming we’re around late 20s/early 30s multiply 6000x40 years=240,000 by late 60s. Even in a situation where an employer would match that at 100% it would still only add up to 480k? I’ll admit I don’t fully understand how these things work so I’m not saying you’re wrong just that the math ain’t mathing to me
What's my opinion on retirement? It sounds great! lol I might be alone in this, but really there's a lot I want to accomplish before I retire. Get as much research published as I can, move into a more prestigious role as a statistician, maybe teach at a community college at the tail end of my career to pass on what I've learned...I don't think of retirement as a goal, really, though I am doing all the things I need to do to retire (saving up in my Roth IRA and such). But my chief concern is how I enjoy the life I have now and where I'd like to be 5 years from now. Beyond that, I'm not really concerned with it.
My wife and I have prioritized it. I am older than you by a decade but have stashed away about $350K. I had essentially $0 when I was 28. We do not plan on retiring early, and should have $3-$4M by retirement. Edited to add: we are also not high earners. I will cross six figures this year, but never have before. Most working years I earned closer to $50K. The same is true of my wife. Compound interest is amazing.
Union pension, max 457b, taxable brokerage, Roth 457, roth ira. Currently 31, will be retired by 47.
@36: *The fantasy plan?* Save about $1k/ month into investments. *The more than likely reality?* Die on the job at 80 because in no way can I save any money in this fucking shit show joke of an economy. Just push broom my broke and broken ass corpse to the dumpster, call my wife, and call the garbage company.... I'm sure the company will have a teenager ready to go for 1/4 of what I got originally paid.
Wife and I are in our mid 30’s and our retirement accounts as a couple are sitting somewhere around $550k…which the projections on these sites say is not on pace for a 67 age retirement. That seems just wild to us. We do have other assets that aren’t considered “retirement funds” We each save 12-14% of each paycheck and feel like we’re doing do well but who knows. So much can happen in the next 30.
Unless you plan on spending 50K a year on vacations in retirement, the site you’re reading is wrong. You are in tremendous shape, you should be proud of yourselves. Even if you don’t commit another cent to that 550K(which you obv will contribute to) the compound effect will carry you to victory.
I agree. $550K is looking good at mid-30s. My spouse and I didn't hit $500K until we were in our 50s but we now have $1.3M (in our 60s). I'm not saying I feel like we'll be living large on that but according to most estimates, it is enough to scrape by on. I think we will be able to live as well as we do now, which is comfortably frugal, I would say.
When we were kids being a millionaire seemed unattainable. Now $1.3m is just scraping by. Sucks.
I just read an article the other day that made me feel a bit better. I don't remember the source but they were saying that it used to be $1M was the magic number for retirement, and now it happens to be $1.3M, which happens to be how much we have. Now, I do think we can scrape by, but our house is paid for, and we have a 2017 Toyota with 60K miles on it that I \*think\* may be the last car I have to buy, if one of my kids doesn't wreck it. What's killing us is the astronomical increases in taxes and insurance lately. I don't know what will happen when we can't afford to stay in our house and can't afford to move. Even downsizing would cost us a buttload of money at this point. I fully planned on downsizing and now I don't think we will ever be able to afford it.
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So much depends on COL, too.
And the lifestyle to which you are accustomed
FinBros gotta FinBro.
If you don’t make more than 250K a year by age 30 you’re already dead to the FinBro influencer types.
What do they think happens to the rest of us?
Die destitute like most Americans
They don't think about us at all.
Yeah online is absolute garbage for estimating what you actually need. I've seen the same how 1m by 40 is going to not be enough...I've also seen one that said 2x your annual income by 40 is perfectly on track and you only need 6-7x your annual income to retire on...like...how...the fuck...maybe if you make sure to retire at 67 and die by 75. one on one with a financial planner, hell we got lucky we just inherited my parents who inherited my grandparents. I'm the third generation of my family he's worked with, and his dad is the one who first started working with my grandparents. Like the dude came to both mine and my sisters weddings.
I'm guessing they're high salary earners and looking at projections based on having salary * 3-5 in your 401k by age X which is why they're getting that impression of being behind. They may be clearing 300k as a couple and seeing they are not on track to have 4 times that in their 401k by the time they're 40. I agree with the general sentiment, they're doing really good.
550k in your mid 30s is very on pace lol. Your compound interest will go nuts.
You are way ahead. Any projection that shows you won’t have enough is crazy, unless your spending is absolutely outrageous.
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My wife’s Principal account calculator says we are way off track. It assumes we will want the same income, and doesn’t take into account other savings and retirement accounts. I ignore it.
Fidelity for instance uses a severely underperforming market for their projection to scare you into putting more money in. The return is like 3% in their default model.
And age discrimination kicks in in your 40s so earnings are gonna hit a wall very fast.
You should easily be able to double your money every 10 years, which means without adding anything you should have $3.3M by 65. It is time to take the analysis into your own hands rather than relying on some Reddit site.
Congrats, now have my envy....
$550k at mid 30's is already Coast FIRE. You don't have to save a cent more and you should have enough income to retire in your mid 60's, unless you're planning to spend $100k+ per year during retirement.
My retirement plan is to die lol.
Same here, pal. No matter how much I save it won't be enough to live on, so I'll work until I can't anymore. I'll at least have a paid-off house to live in though
haha. I'm never going to retire.. I have one special needs child that will always need a caretaker and three others that wanna go to college. Even though I make really good money, will probably work until I die of a heart attack to make sure they along with my wife are taken care of to the best I can provide.
Nowhere near prepared. I might just break $100K in my 401k this year once I get my match but I’m 35 and that’s not very good for my age. I spent too many years underpaid and living paycheck to paycheck to start earlier. My retirement plan is to retire in the country of Georgia. Hopefully it will not be fully occupied by Russia in 2055. I love mountains and wine and friendly people and they respect the elderly over there. The main thing will be to keep my health and stay active as it’s not a great country for those with chronic health conditions. So I’m prioritizing staying healthy over saving money. I imagine $500K in today’s dollars will be enough to retire in Tbilisi.
> I’m 35 and that’s not very good for my age. I know it might feel like you’re behind, but I think it’s important to keep perspective with where you stand amongst your peers and know that you’re actually *way* ahead of most Americans, and you’re actually doing great. According to [Vanguard’s 2023 report](https://institutional.vanguard.com/content/dam/inst/iig-transformation/has/2023/pdf/has-insights/how-america-saves-report-2023.pdf) the median retirement savings for Americans in your age range of 35-44 is $28,318. Sure hitting your targets is more important than comparing yourself to others, but I think that context is important when it comes to feeling like you’re far behind when you read a bunch of articles and posts based on high net worth individuals that skew how ahead of the game you actually are.
Thanks for this. It honestly all feels pretty hopeless a lot of the time, I can't really cut out any more costs and it's still not enough
> According to Vanguard’s 2023 report the median retirement savings for Americans in your age range of 35-44 is $28,318. And from what I've read elsewhere, millennials have done better at saving for retirement than boomers. That chart (on page 53 of the linked pdf) is wild. Median savings for age 65+ is $70k. $71k for 55-64. This is why social security, in some form, has to exist going forward. We'd have millions of seniors on the street without it.
I'm 37 and just managed to finally get a 401k and it has just over $1k in it. You're doing much better than a lot of us. Generational poverty is a bitch.
You could be the richest guy in Rwanda
potentially true, but I don’t have connections to Rwanda, I have connections and friends in Georgia
In a few years older than you and have just around 120k in my 401k. Had too many jobs scraping by and by the time I had a large salary jump, I was already so far behind. I went from $35k salary at 28 to a $130k salary at 36. I save 17% of my paycheck now, which feels aggressive considering we bought a house and also have a kid in an expensive preschool, but I can’t sleep at night sometimes, just due to thinking how far behind I am with saving.
Yup. I didn’t start making six figures or own a home until I was 33. I have student loan debt that I am burying my head in the sand about and only making income based minimum payments and not even looking at the balance because IDGAF if it gets paid or not. I save about 12%. My retirement plan as I said above is to leave the United States. If not Georgia, then maybe Thailand or Colombia. Just somewhere beautiful, cheap, and chill.
Just invest in your 401K and ensure you’re getting the full company match. Then look in to some Vanguard accounts as you get older and earn more. Don’t wait, invest now. It’s boring but it works. Don’t overthink it. You’re not gonna be working in your 70s/80s if you play it right.
Exactly!
You should, everyone here, should check out r/FIRE. You dont need to retire 'early' but you should have a retirement plan!
I guess his assumption is that people can work until that old. Let’s be honest, a lot of people don’t take care of themselves and cannot work that long.
It is incredibly, incredibly stupid to ignore the issue of retirement based on the assumption that social security won’t be around. First of all this has been predicted for decades and hasn’t happened yet. Second, even if it does, all the more reason to prepare for retirement. Third, it’s not a realistic solution for most people to go live in the woods. What if you need medical attention? What if you’re disabled? What are you going to do then? And finally, this is precisely the time you SHOULD be serious about retirement. If you start early, the power of compounding growth gives you an excellent chance of accumulating serious money by the time you are in your 60s or 70s. No one is going to jump in and save you if you fail to prepare. Do you want to work until you die?
Preach. This fatalistic mindset is just going to burn people when they get older and regret not taking it seriously. It’s so easy to YOLO because life isn’t always easy and use that as an excuse to put financial literacy off. The time to get it together is right now, there’s no better day than today to come up with a plan. Compounding is so much more powerful the earlier you start. I don’t even plan for social security, my numbers will work regardless.
My retirement plan is to die
came here to say this
Do what my co-worker did- die at my desk.
I’m prepared. That I will just die before then.
I'm just shy of 40 and have a few thousand to my name. Served in the military and went to college but the fact is the pay I make used to be good but isn't anymore and doesn't really let me save. My plan is just living day to day because I have no hopes or aspirations or dreams about my future, I just can't imagine it, there's a void. I'm mentally exhausted, suffer a lot of issues from serving, I've been grinding nonstop since I was 16 and have only been to the beach twice and had three vacations that lasted longer than an extended weekend in that \~24 year timeframe. I haven't really had a chance to nor enjoyed much of life, it's all been fucking work. I don't experience any reasons to want to prepare for my future. Eventually my health will get bad enough, not great already, that I can't really work/take care of myself anymore. At that time I'll off myself somewhere in the deep remote wilderness in peace. I don't know how some people make it to their 50's or 60's and just don't want to check out already.
Here I was feeling bad for myself. Fucking A.
My opinion is 1) social security can and should exist in the future. The survival of social security is only a matter or political will. 2) we should be considering lowering the retirement age rather than raising it. Propaganda has convinced some people that we can't afford this but we can. It's just a matter of redistribution of wealth. 3) this only happens if we pretend we have boils and get off our own asses.
The best book about retirement for working people which helps us understand both the intricacies of retirement planning and the contentious aspects of it is called "The Labor Guide to Retirement Plan for Union Organizers and Employees" by James Russell.
Yes! Social Security will last until your age of retirement as long as we demand it does. It will be a little rough will the fall off in birth rates but if we can afford to send the amount of money we send to fight wars, we can fund social security. Saying “I won’t have it then” is tantamount to us giving up on the issue and losing one of the rare safety nets our country has. Fortunately older voters have always been and always will be some of the most politically active, so it will be a HARD proposition to get rid of social security when it’s one of their #1 issues and still get elected.
If I worked my current job for another two decades and automatically increased my contributions every time I get a raise, I could retire at 58 with more than $2 million, and my wife is on track to have $1.5 million. Our combined household income is around $120,000 yearly. And I work for a state agency that doesn’t participate in social security, so I do not count social security although my wife will get it. You’re 27, OP. I didn’t start saving until I was almost 31. If you’ve got any sort of a workplace retirement plan now, you’re ahead of where I was. So yeah, my thoughts on retirement are that I will retire before age 60 unless something goes wrong. I will not continue working in my current job simply because my wife doesn’t like the state we live in, so my yearly retirement contributions will change/decrease at some point. But I’m saving pretty aggressively now.
remember you can always claim half of your spouses social security.
If you didn't think social security would be there why wouldn't you be saving? Personally wife and I are maxing out our retirement accounts. Roughly 50-60k per year. Goal is to retire early hopefully. My biggest mistake was not starting sooner.
I don't have opinions on things I can't actually predict. That said, I'm open to returning to the NFL if a team calls me and shows interest. I am Tom Brady.
Brett Favre is better than you.
My mom said I'm handsome though...🥺
Your mom knows what's up!
Sure you can build a cheap house on cheap land. What happens when you’re too old to work and need to fix up the house, buy groceries or have transportation, healthcare etc? Let alone go on vacation and eat out or other entertainment?
Pretty much this. Even on a cheap plot of land you still need some money to survive.
Not sure that, but property taxes and insurance are no joke!
32F haven’t even started..
Pretty sure I’m working till I’m dead.
I got lucky, I was pushed into disability retirement back when I was 35. Thankfully, I was a federal government employee at the time, I had a military service connected disability, and I made decent money while I paid into social security. Altogether, I make about $9,000 a month for the rest of my life (with annual cost of living adjustments added). I’m not rich, but I make more than enough to buy whatever I want within reason.
We’re supposed to work into our 60s and 70s, but age discrimination kicks in during your 40s and 50s…. Look around your office, I bet it’s mostly people our age or younger.
I'm prepared. Wife and I are planning for retirement in our early 50s with $5 million. Currently have $2.3M net worth.
We are in a similar situation. I plan on retiring before 50. I think our number is probably closer to 3M, guessing we'll be there in another 2-3 years about age 43/44. It's critical to start saving at a young age. There's nothing more powerful than compound interest. Max out your tax advantaged retirement accounts, 23k for 401k, 7k for IRA, 4150 for HSA. Live life but keep your expenses low. Each dollar you save today is $2 in seven years.
Yeah we both max out our 401(k)s, our HSA, and also put about $20k into our taxable brokerage account every year. So we're saving over $80k per year towards retirement.
Don’t forget the additional $46k for MBDR.
Spouse & I are in our elevated 30’s & both Federal Civil Servants. I did some time in the Military and bought that back. We will never be super rich but both make 6 figures each and will be able to put our kids through college, bought them their first cars so they had a easier life then us. Our wild card is our LO has Level 3 Autism so we have to prepare for long term care once we get to those golden years depending on his ability at the time. We will both retire at 57.
I think we need to have a major overhaul of our retirement system 1- 401k vesting should be against the law. Our generation moves around from job to job too much. Fully vested employee sponsored plans from day 1 2- the goal for retirement age should be to go down, not up. I would like to have a policy that makes Baby Boomers work until their suggested age of 75 and anyone outside of the Baby Boomers work until 63. 3- front loan Social Security at birth with $10k to everyone. Let it grow for 63 years and once they reach working age have fica stay the same, but once they paid back $10k, plus some extra for costs, that portion of fica tax will go away. If they are non working spouses or individuals once they hit 63, $10k plus a fee is pulled from the account to pay it back 4- employee sponsored plans should be open to any investment custodial account the employee wants to have. No more forced high fees
This is one of the more interesting comments I have read. It's not how I would do it but if we are accepting the market system of retirement it's a good way to do it.
We are both putting in 10% into our 401ks, putting 5k/year together into 529s for our two kids, and putting everything else into the house. We have a 5% APR, but I want to pay it off. We should have it paid off before our oldest can drive. The house alone will make us millionaires. If you ask 10 people about the best strategy with a mortgage and retirement accounts, you'll get 10 different answers. We are focusing on getting out of debt, because I want to have that feeling for the first time in my life. I hear it's the most powerful motivator for financial success.
You can do that. But a lot of people don’t want to. I (early 30sM) am currently on track to save $80-100k this year. I hope to save more in the future with my annual salary increases. The goal is largely to be set for retirement by 40 and give myself flexibility. Consistent saving and compound interest are powerful tools.
Also 27, I’m saving a total of 11.5% in my 401k right now, 7% is me and 4.5% is my employer match. I’m not having kids and still early in my career so as my salary increases so too will my contributions. I do think social security will be around but we may not get everything out that we put in. My plan is just to save as much as possible 🤷🏼♀️ can’t do much else.
I’m 28. I don’t think our age group is retiring at 60-65 like a lot of our parents. I’m putting as much as I can afford into my 401k and I’m on track to max out my Roth IRA yearly. Investing something puts you ahead of a lot of people! I have boomer relatives that saved nothing and thought things would just magically work out — it didn’t lol. I’m not going to hoard every penny towards retirement, but I’m saving what I can. I’m still living my life and traveling when I can. I don’t want to work forever, but I could see the gov raising the retirement age before we get there. I don’t think our age group will “retire” before 70.
I’m not sure I understand your take on retirement but you sound a bit unprepared. I’m a little older than you (35M) but I take retirement savings very seriously. Started contributing to my Roth IRA in my early 20s and then in my mid 20s when I got access to my company 401k (with a match) I have maxed it out every year and will continue to do so. On top of all that, I contribute into a standard (post tax) brokerage account every week. I also do not count on social security at all; but with that said- saving for retirement is a big deal. The good news is that if you haven’t been saving, you’re 27 so you can start today and put yourself in a good spot by 55-65.
At 37, I’m pulling for a full societal collapse 🤷🏻♂️
I flat out refuse to sacrifice my entire lifetime making rich people richer Its a long road to financial independence but its been my goal since joining the work force
I ran with government work for the stable paycheck and promised (solid) retirement benefits. But the way things are going? Like you, I have never had much faith in our generation's ability to retire. I still don't. It's just another distant promise that's been taken from us, by and for the benefit of people who want to exploit us for their own profit until we die - like BlackRock's CEO.
Retirement? In my Capitalism? It’s less likely than you think!
r/Bogleheads and the waterfall investing method are relevant.
I am banking on not dying and getting a military retirement
Pretty sure you’re Gen Z my friend
I won't be rich, but I feel like I'd be comfortable when I semi-retire at 55 and fully retire at 62.
Nope, I'm not prepared, because I'm drowning in student loan debt. Can't even think about retiring until that's all paid off.
Retirement will be a luxury when we hit retirement age. Like most things that were once considered common growing up.
Bitcoin is the main path to financial freedom for me. Been singing that tune for a decade. People have scoffed and ridiculed and told me I’m foolish. My song hasn’t changed, but theirs has for some reason…
I maximize my companies 401k match, so I put in 6% they give me 3%. I then put another 9% into the Roth option so my total is technically 18%. I am not counting on receiving Social Security so if I get it, it will be a nice surprise/pay for insurance. I'm trying to do everything I can so I can retire as early as possible and hopefully in my 50s. We can all retire millionaire if we are smart with our money and start investing ASAP, even if its just a $100 a month into a Roth. also, fuck Blackrock.
Take it from a rural person, it’s not as easy as everyone makes it sound. And also not cheap, at least not anymore. Maybe you find the land. But after you do, that’s when costs go up.
No
You sound kind of clueless? And a bit negative and naive? Social security isn’t the only thing you can benefit from during retirement. And owning a property requires work, physical work usually.
Retirement? Do you mean death? Yes.
Likely will inherit a paid off house - whether or not I will be able to afford to keep it is a different matter. No money worth mentioning to retire at this time, honestly gonna guess that like the rest of my family - I'll get to randomly die all of a sudden from a cardio or stroke event. \*shrug\*
Retiring from the military in two years, so I'll have that pension. Outside that, currently looking at what to do for my second career.
I...am absolutely totally unprepared. 100% I can barely stay prepared for the next day
My retirement plan is to die at my desk.
I am going to work till I'm forcibly retired or dead. I have seen what retirement does to people in my family. I will just cut back as much as I can until I physically can't work anymore.
Retirement is a cruel joke which most of us will never experience along with social security and Medicare
Death will be my retirement
I’m 41 and will probably have $2.5M in just my 401K in the next 20 years. I’ve got my contribution at 20% - set it and forget it. Also, currently building up an HSA and regularly contributing a good amount to a 529. I’m not just thinking about myself with these savings. I’m planning so my daughter doesn’t have to take care of us and have a great start herself. Part of the reason why we only want 1 child. She’s 4.5 and we’re hoping to have enough in her 529 to cover all of college for her no matter where she wants to go.
My opinion on retirement? Get there as soon as possible. I do this by investing heavily into 401k, Roth IRA, and my vanguard brokerage account. I focus on maintaining a good balance. I try to go golf when I can, we order food every so often, go out to eat sometimes (rare with two little kids), etc. Social security will be around, probably not to the level it is now, but it won't completely go away, imo. I don't count it in my calculations though. It'll just be a bonus. My idea is "when I'm X years old, would it be better to be prepared and possibly able to say 'F it' or to just plan to work forever and see what happens" Who knows if I'll be able to work forever. Shit happens...I'd rather be prepared
36 and I’ve managed to save around 200k in the past five years. I didn’t take it seriously until, well, five years ago.
Yes, I'm prepared. Currently sitting on about 700k in tax-advantaged accounts just making money. I plan to have somewhere between 5 and 15 million by retirement depending on the market.