Are you either much younger than I imagine, or an extremely high earner? Maxing out both should be netting you ~$25k/year in invested income. If you did that for 10 years and invested it in something other than Gamestop, you'd have around $400k.
I've probably taken more years off/worked at a company that didn't have a 401k than expected for my age, so that might account for it.
I have a target fund with Edward Jones, a growth stock fund (I can never remember the actual name) and some commercial real estate. My wife and I have been pretty hard on the gas and just now starting to enjoy the fruits of our labors. Hence, the ridiculous car in my garage lol My RH account is just my funsies account
Got it. I always thought the "multiples of income" was a little bit of a weird goalpost anyway. It doesn't really matter what you're making now, it matters what you want your income to be in retirement. A lot of the rules of thumb are based on replacing your working income with a similar income in retirement. I definitely do not need to replace my current income in order to retire, and I suspect a lot of people don't.
I went to a financial planner, he's kept me in shitty funds for 5 years. I should be up over 71% over that time with the index. Instead I'm up...4%. 4% with 75% of that being hit by a 2.3% MER.
It’s never too late. If you’re below 45, you can still put away a pretty sizeable nest egg. I’m not sure about you guys, but I’m definitely not planning to rely on Social Security for anything. I’m just hoping it will be there in addendum to what I will be living on.
Financial planners can be amazingly bad. Even the good ones are often bad for simple things like picking your retirement mix. When I first started saving for retirement, I went to a guy who got me set up with a Roth IRA. His fund selection wasn't bad, really - it was an aggressive growth fund, great for people my age, and performed okay. The problem is most of those funds don't outperform the index funds, and their expense ratios - which included my financial guy's cut - mean they have to outperform the index funds by ~1% or so to break even. Which they usually don't do. So I didn't get shitty advice, per se, but still was put in a less ideal situation. Get your funds changed around. Pick a 3-4 fund portfolio, or a stock target date plan from Vanguard or Fidelity or Schwab. Agreed that it's never too late. Even if you're 60, you should start. Best time to plant a tree is 10 years ago, but the next best time is today. I'm planning on Social Security, but not relying on it. The models say it will be there, though it may be reduced. I don't want to exclude it completely, because it's simply not possible for the country to support retirees without some form of social support. So something is going to be there, whether it's cash or subsidies. It doesn't make sense to totally discount if you're doing long-term planning. But I completely agree that I'm not baking it into my plan as a single point of failure.
I have a self directed fund with half of my cash wealth put in it, and I've far outperformed it. I've invested in several of the Canadian versions of Vanguard funds. I've done fairly well considering. Mostly in XUS.TO and VFV.TO. XIT.TO was a risk play, but I got out with +29% in just over a year.
Oh I've started, I was just pointing out that there were years where I could only contribute to my IRA because there was no 401k available. Which brings me to my next point: bump the IRA contribution limit to $25k, remove the income cap, and eliminate the 401k. It's stupid as shit that your employer gets to pick whether or not you have a tax-advantaged retirement account available, and which firm you have it with.
There's already a contribution cap; an income camp is a stupid redundancy. Especially when there's a loophole as glaringly wide open as the backdoor ROTH conversion.
Yeah, that contribution cap is insanely low, in my opinion. Particularly when it is contributed with post-tax income. And they are going to tax the shit out of whatever is left when you die. I can see a $6k limit on an 18 year old, but that limit needs to go up a lot before you get so close to retirement age. A lot more than the one bump to $7k at 50.
The cap is so low because they assume you'll make it up by contributing to your 401k. Ignoring the great swaths of Americans who don't have access to a 401k because that's bougie shit for people who actually have the slightest bit of leverage with their employer.
Yeah, this makes no sense. I can't contribute to a Roth, but I can contribute to a traditional IRA and convert it instantly to Roth. What possible reason is there for this? The 401k stuff makes perfect sense, though. It follows the model of health insurance being tied to employment. Which is perfectly logical. Are they? The federal estate exemption is like $11 million. I think the states that have a lower exemption are still $5m+.
I went from an employer that didn't offer one to one that did in November. I literally didn't get a paycheck for the rest of the year because I had 100% of my pay going into my 401k trying to make up for lost time. I was basically using my own paycheck to launder my own money into my own retirement account.
Yeah, estate taxes are basically not a thing for normal people. The only taxes that result from inheriting a retirement fund come from the fact that you (in most cases) have to disburse the funds within 10 years, and you'll pay income taxes on any of those funds that were tax-deferred (401k, tIRA). It's really absurd. Two of the hardest things to financially deal with are healthcare and retirement. The people who are going to be least equipped to deal with those things are low-earners with either part time or menial jobs, both of which are unlikely to provide a 401k and good health coverage. Not to mention the complexity which often causes people to be paralyzed with indecision or fear and not take advantage of what they are offered.
Fed was $1.5mm in 2005, and I think goes back to $5mm in 2026 or something. Which, still won't impact most people. But, the fact that it can change, depending on who's in office means there's always a chance it could impact you. So, encourage your loved ones to die while it's high!
Sure, but even at that it's a marginal rate. You don't hit the highest marginal rate until nearly a million dollars over the exempt amount. So if you assumed it went back to the 2005 cap, someone inheriting $2.5m is still getting an effective tax rate under under 30%. I don't think I'll lose sleep over it. Winder if there will be a sudden uptick in mysterious poisonings in rich families during 2025?