How old are you and how much do you have saved for retirement?

[Fritzo]

I'm set to retire at 59 as a millionaire if I keep my income level the same for the next 18 years. The company's 50% match up to 10% of 401K contribs makes it easy

 

[TXHokie]

What a ridiculous article. Socking away $17k / yr is impossible for some people (probably most people if I had to guess).

Then at the end of the article it makes it sound like your 401k is the only money you'll have available to live off of (if you have the capability to send off $17k to just your 401k/yr, this just sounds stupid). This guy isn't very samurai like.

I don't think it's all that impossible, maybe early in your career when you're not making much but I would guess halfway thru or later you should be able to. Choose your career wisely is the key it seems. I bet most mid career people here on ATOT can sock that much away, whether they want to or not is another story. I know of at least two college buddies that are well into the high range of that table range there (in their mid 40s working in IT). However their lifestyle is probably a bit too frugal for my taste. I do save and also want to enjoy life as well. I just attended an acquaintance funeral after he lost a battle to cancer and a couple years ago went to my former boss funeral who passed away with a heart attack at 49. My motto is to save enough so I don't become a burden to my kids, reduce risk so family are taken care of, and live it up a little. You can't take it with you.

 

[Jeffg010]

Understandable, but Social security is not as big of a stake. We all know it will not be there......even though they keep taking our money.

Stock Market is the biggest pile of BS right next to........well, ask George Carlin.

Guys like you make me laugh. Just because you have no clue what to with it does not make it BS. I done well with it and will continue to use it and make money on it. Keep working for the rest of your life no sweat off my back.

 

[nehalem256]

What a ridiculous article. Socking away $17k / yr is impossible for some people (probably most people if I had to guess).

Then at the end of the article it makes it sound like your 401k is the only money you'll have available to live off of (if you have the capability to send off $17k to just your 401k/yr, this just sounds stupid). This guy isn't very samurai like.

Bro, you need to read this article:

http://www.financialsamurai.com/2010/10/03/how-to-make-six-figures-income-at-almost-any-age/

:awe:

 

[SearchMaster]

What a ridiculous article. Socking away $17k / yr is impossible for some people (probably most people if I had to guess).

Then at the end of the article it makes it sound like your 401k is the only money you'll have available to live off of (if you have the capability to send off $17k to just your 401k/yr, this just sounds stupid). This guy isn't very samurai like.

It can get even harder if you make good money - the IRS has a "highly compensated employee" rule where employees who make >~$115K can't contribute disproportionately to a 401K than those who make <$115K (that number changes annually). So if the lesser compensated employees don't contribute enough, they have to refund money to the higher compensated employees that do.

 

[SearchMaster]

I'm set to retire at 59 as a millionaire if I keep my income level the same for the next 18 years. The company's 50% match up to 10% of 401K contribs makes it easy

You're around 40, right? So if you retired at 59 and lived to 85, you'd have to live 26 years on that million bucks. It's doable if you keep your expenses low (e.g. stay in your paid-for house, few vacations) and inflation stays reasonable but you'll have to pinch your pennies somewhat

 

[Tweak155]

I don't think it's all that impossible, maybe early in your career when you're not making much but I would guess halfway thru or later you should be able to. Choose your career wisely is the key it seems. I bet most mid career people here on ATOT can sock that much away, whether they want to or not is another story. I know of at least two college buddies that are well into the high range of that table range there (in their mid 40s working in IT). However their lifestyle is probably a bit too frugal for my taste. I do save and also want to enjoy life as well. I just attended an acquaintance funeral after he lost a battle to cancer and a couple years ago went to my former boss funeral who passed away with a heart attack at 49. My motto is to save enough so I don't become a burden to my kids, reduce risk so family are taken care of, and live it up a little. You can't take it with you.

The people on ATOT aren't your average group. There are people that don't even make $17k/yr.

 

[Tweak155]

Bro, you need to read this article:

http://www.financialsamurai.com/2010/10/03/how-to-make-six-figures-income-at-almost-any-age/

:awe:

Dear gawd.

 

[Fritzo]

Bro, you need to read this article:

http://www.financialsamurai.com/2010/10/03/how-to-make-six-figures-income-at-almost-any-age/

:awe:

I'm convinced the best way to make 6 figures a year is to create a guide that tells other people how to make 6 figures a year.

 

[Fritzo]

You're around 40, right? So if you retired at 59 and lived to 85, you'd have to live 26 years on that million bucks. It's doable if you keep your expenses low (e.g. stay in your paid-for house, few vacations) and inflation stays reasonable but you'll have to pinch your pennies somewhat

My wife gets a nice pension on top of that and I'm estimated to get $2000/month in social security (if it's still around). Living off the interest of 1.5-2 million should be fairly comfortable.

 

[vi edit]

I'm in the "ratio of savings relative to income is not indicactive of retirement needs" group.

We got a bit of a later start on investing. My wife was 25 before she got out of school and completed her residencies. By that point I was 27. So I've only had about 7 good years of savings. I'm 35 (today actually!) and my wife is 32.

Sitting on about 215k in 401k's and Roth's. Another 10k for kids college accounts. About $25k in liquid, emergency cash. And we've got about 100k in home equity. Plus with our jobs we'll have another $800-$1000 a month in modest pension plans kicking in when we retire.

It's good savings by most measuring sticks. But low to moderate given our income levels. We're also doing that with 2 kids and a daycare bill that is close to $21,000 a year. Our savings are about 1.5x'ish if you count retirement and liquid cash. Closer to 2x if you include home equity.

Fortunately for us, we'll likely have the house paid off in the next 15 years, hopefully a decent chunk of savings for college costs, and the damn student loans for my wife should be gone to. I'll be heading into my 50's with a very plump retirement account and very little, if any debt and having a very, very comfortable household income.

We are fairly modest with money. We have newer cars, but nothing fancy. We aren't too crazy with clothing, going out to eat, or other major luxuries. I do a lot work on my own around the house we try to do value oriented, yet fun vacations with the kids. I'm confident I could easily live at half if not even a 1/3 of my income level if I didn't have daycare or a house payment.

Retirement in my early 50's will be realistic. But at that point the money is probably too good to turn down.

 

[Elbryn]

:thumbsup: I think taxes and savings contributions are things commonly overlooked as well as how much a mortgage payment eats into your income. People think see their spending on 80k a year and think 'Man - I don't have enough to retire and still get 80k from my savings'. What they don't realize is 80k pre-retirement with mortgage could easily = 50k post retirement no mortgage. Just for a reference - For the 4% SWR it results in a reduction of 'required' retirement from $2M down to $1.2M

between health insurance (pre medicare) and assuming nothing from social security we've assumed to trade off with no mortgage payment. right now with some 22-32 years minimum until retirement there's a lot of haze surrounding those two aspects so we assume the worst case and can adjust as we get closer.

i think it's also important to note that with a 4% swr and 3% inflation, if you're using current dollars for your estimated expense value, with 24ish years to go, you're really talking about needing 50x expenses.

i'm 33. wife is a few years older. we're at 5x estimated expenses right now.

 

[jaha2000]

31. Combining my wife and I, i would say we have 7 times our yearly income.

 

[Mixolydian]

I'm 35 (today actually!)

Happy birthday!

 

[Elbryn]

Yes, I had 25% bond funds in the mix. EVERYTHING fell!

if you nearly cashed out due to the drop, you might want to consider more bonds. presuming you held on, re-balanced, and added to contributions, it's all worked out for you. now might be the time to change the plan to a less potentially volatile one that you can comfortably maintain without panicking.

 

[Exterous]

I'm 35 (today actually!)

Happy birthday old man!

between health insurance (pre medicare) and assuming nothing from social security we've assumed to trade off with no mortgage payment. right now with some 22-32 years minimum until retirement there's a lot of haze surrounding those two aspects so we assume the worst case and can adjust as we get closer.

Good grief my reading comprehension is terrible today I agree that much is hazy

i think it's also important to note that with a 4% swr and 3% inflation, if you're using current dollars for your estimated expense value, with 24ish years to go, you're really talking about needing 50x expenses.

Edit: NM I re-read your post. As previously mentioned my post was not supposed to be an example on what ratio to use when your retirement is 30 years down the road

 

[rsutoratosu]

Ill turn 37 soon so I have 2 roll over ira from previous 2 jobs, current market value is 157k and 72k. 40k in self directed stock account that I can liquidate to pay for stuff. Other than that, i barely have savings..
Im working for myself now so no more 401k

Most of my money goes into the house, and misc expenses ie gas, tool, food, etc.
-House mortgage - set monthly 12 yr left
-Car 2 payment - set monthly
-New born baby expense - high variable number
-Insurance car/house - set monthly
-2 Life Insurance policy - set monthly

2012 Gas - $4227
2012 EZPass toll - $2200
2012 Restaurant - $9334

 

[Elbryn]

What a ridiculous article. Socking away $17k / yr is impossible for some people (probably most people if I had to guess).

Then at the end of the article it makes it sound like your 401k is the only money you'll have available to live off of (if you have the capability to send off $17k to just your 401k/yr, this just sounds stupid). This guy isn't very samurai like.

even saving the max 401k allowed per year across the average working career, it wont make you rich. middle class, yes but not rich. say you put in a total of 17.5k a year from all sources from age 22 through 65 with an 8% gain per year. that gets you about 5.8million over the 43 year span. counting 3% inflation, gets you about $65k per year at 4% swr in age 22 dollars.

say you start with 17.5k at age 22 but add 3% to that number every year. numbers jump to about 8.33 mill at age 65, 4% swr = $93.5k a year in age 22 dollars. it's good upper middle class, but it is not rich.

 

[jlarsson]

whoa thats risky

It may appear that way, but the 1x in company stock aren't options. It's stock I was given. And, I can't exactly do anything with it right now (privately owned company) until I either leave the company or retire.

 

[slugg]

I'm 25. I have roughly $30 million saved for retirement, give or take $30 million.

 

[vshah]

27, 1x

will have to buy a house at some point though - bye bye savings!

 

[dave_the_nerd]

Too old. Not enough.

 

[WackyDan]

What a ridiculous article. Socking away $17k / yr is impossible for some people (probably most people if I had to guess).

Then at the end of the article it makes it sound like your 401k is the only money you'll have available to live off of (if you have the capability to send off $17k to just your 401k/yr, this just sounds stupid). This guy isn't very samurai like.

Depends how you define that $17k? My employer matches to 6% so I'm putting away with match probably 14k a year now. Still isn't enough playing the catch up game I am playing now, but better than most.

 

[TuxDave]

Is atot made up of smarter than average internet people (huge savings, supermodel wife, Ferrari) or is this a lot of lies?

Who let this 99%-er in???

 

[Blieb]

Depends how you define that $17k? My employer matches to 6% so I'm putting away with match probably 14k a year now.

FYI - Based on your post I get the feeling you see 17.5k as the total limit.
17.5k is the employee max. The employer match is guided by different limits:
http://20somethingfinance.com/maximum-employer-401k-contribution/

You can put in 17.5k and they can put in (for example) 10k, making 27.5k total deposits for the year.