OT - How much should your 401k be

[inkman]

No pension ink? Realistically you'll probably need about 400k to be secure. You'll be working until you die. You're ######. Get a half mil life insurance policy for the little one.

Meh, my wife is 13 years younger than me. If I make it past 65, and that's a big if,s he can support my ass. :Beer:

[ubkev]

When the market ate sh!t in 2007 I lost almost 25 grand. I was 22 years old and had been putting 11% of every paycheck into my 401k for almost 3 years. I know that everyone says not to worry about market fluctuations when you're young, but it really freaked me out. I moved to a new state and a new company in 2010 and I haven't opened my 401k yet. I know this is a huge mistake. 6 years with no new cash flowing into my retirement is bad. I just couldn't imagine losing that kind of money again.

 

This thread did get me thinking, though. I guess it's time to call Charles Schwabb and get this show on the road again. I'm gonna miss that hundred or so bucks a week though. At least at first I will.

[Samson's Flow]

When the market ate sh!t in 2007 I lost almost 25 grand. I was 22 years old and had been putting 11% of every paycheck into my 401k for almost 3 years. I know that everyone says not to worry about market fluctuations when you're young, but it really freaked me out. I moved to a new state and a new company in 2010 and I haven't opened my 401k yet. I know this is a huge mistake. 6 years with no new cash flowing into my retirement is bad. I just couldn't imagine losing that kind of money again.

 

This thread did get me thinking, though. I guess it's time to call Charles Schwabb and get this show on the road again. I'm gonna miss that hundred or so bucks a week though. At least at first I will.

When you're that young you shouldn't even really care about the market fluctuations. You may have lost 25K in the short term, but by riding out the valley you almost certainly gained all of that back.

 

i.e. Buy a stock at $25, crash happens stock is now $10, market recovers and same stock (as long as it isn't a garbage penny stock) follows market back to $25, market growth brings your stock to $30 - you made $5. Panicking and following the 401k value will drive you bonkers when you are first starting out.

[SwampD]

When the market ate sh!t in 2007 I lost almost 25 grand. I was 22 years old and had been putting 11% of every paycheck into my 401k for almost 3 years. I know that everyone says not to worry about market fluctuations when you're young, but it really freaked me out. I moved to a new state and a new company in 2010 and I haven't opened my 401k yet. I know this is a huge mistake. 6 years with no new cash flowing into my retirement is bad. I just couldn't imagine losing that kind of money again.

 

This thread did get me thinking, though. I guess it's time to call Charles Schwabb and get this show on the road again. I'm gonna miss that hundred or so bucks a week though. At least at first I will.

I was 38 when the market crapped out and I was glad. As I don't plan on retiring for a while, it just meant I was buying more shares each paycheck.

[ddaryl]

So as I enter my 30th year of employment, I'm beginning to think more and more about retirement. What should my 401k balance be?

 

Under 100k

100-200k

Over 200k

 

Discuss

 

 

I'm almost 48 with about $220k saved in 401, about 8k in bonds, and 2 ira's with about 20k a piece in them.  I also have 16 years of pension which is now capped (mutherf%$^Rs). thios is both mine and my wifes portfolio minus our house which will bring us a nice chunk when ready to sell

 

All I can say is I'm nervous and stressed about retirement. Its the medical costs that will keep every single one of us from being able to retire semi-early .. AND NO IT HAS NOTHING TO DO WITH THE ACA and EVERYTHING TO DO WITH INSURANCE GREED/WALLSTREET GREED

Edited October 6, 2016 by ddaryl

[pi2000]

Assuming you have good 401k fund options, you should be max'ing it out, but if you can't afford to do that right away, most financial institutions offer an annual increase program such that your contribution amount increases each year by whatever % you decide... until you hit the max.    This works well, especially if you assume you're getting a merit increase each year which will offset the additional contribution rate.      

[ddaryl]

Sure spending shifts around, especially towards medical expenses, but in a county where median household income doesn't even reach $5k a month, I have a pretty hard time believing that's the monthly expense that most people need to plan for in retirement. That's really all I'm saying, and I certainly don't mean to suggest that people should aim to save only the bare minimum.

 

 

 

 

Add in inflation to that. In 20 years that's going to be close to poverty levels. 5k today won't go anywhere's near as far in 15 20 years

Edited October 6, 2016 by ddaryl

[ubkev]

OK it's been about 45 minutes since my last post. 401k is back up and running.

 

What a F'ing lazy dumb ass I am.

[TrueBlueGED]

Add in inflation to that. In 20 years that's going to be close to poverty levels. 5k today won't go anywhere's near as far in 15 20 years

Well sure, but I figured inflation was implicit to the conversation. Ie) when I say $5000 I inherently mean what that equates to at retirement. I'm sure as hell not ambitious enough to project 40 years of inflation as I post :p

[Claude_Verret]

Here a good article that illustrates the almost certain damage that can be done to your portfolio when attempting to time the market.

 

https://www.ifa.com/12steps/step4/missing_the_best_and_worst_days/

 

 

 

 

 

 

 

 

[jsb]

Well sure, but I figured inflation was implicit to the conversation. Ie) when I say $5000 I inherently mean what that equates to at retirement. I'm sure as hell not ambitious enough to project 40 years of inflation as I post :P

Sir if I can give you some wise advice....... Don't blink because you'll be in your 20s and 30s one moment and the next you'll be going how in the hell did I get to 60 so fast.

 

As for those worrying about a market crash...... when your young it's much easier to not worry about because what you're doing is buying a share, when the share goes down you'll be buying more of them. When the market recovers you will get your lost money back plus gain a much higher percentage in the shares you bought cheap. Plus while your in your productive years you are saving in the taxes you're not paying.

When you do use the money during your retirement years, you'll just be adding to the amount your receiving from SSecurity and hopefully some other kind pension fund. Although I think pensions may be a thing of the past going forward, but you never know. Once the baby boomers all leave the work force, the way to recruit may be to re-offer different benefits including pensions.

[TrueBlueGED]

Sir if I can give you some wise advice....... Don't blink because you'll be in your 20s and 30s one moment and the next you'll be going how in the hell did I get to 60 so fast.

Oh trust me, I'm not pooh-pooing saving money and I'm well aware to start early and save as much as reasonably possible. But some of the amounts being tossed around aren't realistic for myself and people with my level of income, which is far from a small minority.

[Wyldnwoody44]

Cocaine is a hell of a drug

As I read this.... I am in forest lawn cemetery staring at Rick James headstone.... How fun :)

 

Aud? You don't like my trust in the market.... I don't have a lot of faith, but it's imporant to future retirement stuff. (you'll never see me in the politics thread)

[Tondas]

 

Here a good article that illustrates the almost certain damage that can be done to your portfolio when attempting to time the market.

 

https://www.ifa.com/12steps/step4/missing_the_best_and_worst_days/

 

 

 

 

I'm a Boglehead too.  Started in 1999 when Bogle authored this book.

 

https://www.amazon.com/Common-Sense-Mutual-Funds-Anniversary/dp/0470138130

 

I did what he said.  17 years later, I'm 55 and retiring in 6 months with enough accumulated to live on $75k/year till I'm 95.  Biggest thing to wealth accumulation is to start TODAY with as much, or as little, as you can afford.  It does take time, but it works.

 

I also found this guy to be a good resource.  http://retirementoptimizer.com/  He's a retirement specialist from Canada who provides concrete solutions to retirerment for all amounts of money saved.   

[PromoTheRobot]

I am essentially self-employed. Wife works. We got our meager retirement flushed in the last crash so we are in rebuild mode. We are living off the wife's income and I'm banking all I make. We have 8-12 years to retirement, figuring on a few hundred grand saved plus the house value. Buy a mobile home down south, live on SS and supplement it with the savings. Been trying to talk the wife into considering retirement in another low-cost-of-living country but she won't hear of it. A buddy just moved to Da Nang, Vietnam. Living well in a condo near the beach and paying all bills for under a grand a month.

Edited October 6, 2016 by PromoTheRobot

[Claude_Verret]

I'm a Boglehead too.  Started in 1999 when Bogle authored this book.

 

https://www.amazon.com/Common-Sense-Mutual-Funds-Anniversary/dp/0470138130

 

I did what he said.  17 years later, I'm 55 and retiring in 6 months with enough accumulated to live on $75k/year till I'm 95.  Biggest thing to wealth accumulation is to start TODAY with as much, or as little, as you can afford.  It does take time, but it works.

 

I also found this guy to be a good resource.  http://retirementoptimizer.com/  He's a retirement specialist from Canada who provides concrete solutions to retirerment for all amounts of money saved.   

 

 

:thumbsup:

 

I'm about 10 years behind you, but I'm on track hopefully.  Congrats!

 

edit: I have that book in my library as well

Edited October 6, 2016 by Claude_Verret

[North Buffalo]

I haven't started contributing to my 401k yet because I know nothing about it and haven't made the time to meet with somebody about it.

Should I contribute if I don't plan on staying with the company long?

You always get your money back can roll into IRA, also find ourlt when you become vested. Between my wife and I we have a Roth IRA from a rolled over deal, 2 401ks, and 2 Pensions, plus a rental property. Nothing incredible but steady income. put something away now and keep adding.

[Tondas]

OK it's been about 45 minutes since my last post. 401k is back up and running.

 

What a F'ing lazy dumb ass I am.

 

Good for you, seriously.  You won't regret it.  And thanks to Ink for bringing this topic up. 

[ubkev]

Good for you, seriously. You won't regret it. And thanks to Ink for bringing this topic up.

Good on you guys. Seriously! This board always reminds me of things that I should be doing. Remember the Finance thread? That was another good one.

[TrueBlueGED]

Good on you guys. Seriously! This board always reminds me of things that I should be doing. Remember the Finance thread? That was another good one.

 

That thread was awesome--convinced me to move my money from a 90/10 stock/bond split mutual fund into an index fund.

[Sabres Fan in NS]

That word. I don't think it means what you think it means.

 

Oh, yeah.  It does and I am using it correctly.

[Weave]

Oh, yeah. It does and I am using it correctly.

You and me. Same page.

 

If I wasnt on my phone I'd go looking for the PBS article about how we are being thoroughly fleeced by the imdustry we were forced to enter.

 

Scammed from every direction.

[Sabres Fan in NS]

I know the driving force behind the rise and fall of pensions in this country has been well discussed but the point you're making has been exactly what I've been thinking. As a guy who's always had a pension, I paid particularly close attention to the "why" involved each time I saw a company pension program die. Every time the argument that 401k will do everything a pension did for you was used. Scam? Absolutely. The fact that Ink was compelled to inquire about a comfortable amount to have saved should be the flashing light for the truth about 401k savings. In the days of pensions no one would have worried about retirement because the pension payed you for life. I teach a course to apprentices about home budgeting/money management and I use the three legged model from the 60s/70s. Retirement=pension+SS+savings(annuitys/401k/investments). Replacing pensions with 401k saved huge amounts of money for the corporations even when the philosophy started with 100% match. 50% match up to 6% sounds like theft to me. The corporations save on pension contributions and operating costs and still managed to "bargain" their responsibility for your retirement even lower seems archaic. What's next? Will the Pinkertons return with their baseball bats to start smashing our kneecaps?

 

And there you have it.

 

The devil is in the details, as they say. 

 

Thank you sir for delivering the details.  The exact same thing happened in Canada.  My parents have earned more in retirement (teachers) then in their working years.  

 

Meanwhile, neither my wife, nor myself, have pensions.  We are now on the *Freedom 95* plan.

[SwampD]

Could you guys even imagine the disaster that would be a privatized Social Security system?

[BagBoy]

I'm quite sure I'm over-simplifying things here and there will be perfectly valid responses that disagree with me, but I don't think pensions are a sustainable answer to taking care of retirees in either the US or Canada, at least not as they exist today.  

 

If you earn X number of dollars, do you really NEED 80% of X number of dollars each year after you retire until you die? 

 

I think the main problem (for lack of a better word) is that in general we are healthier, and live a lot longer than we used to.  I voted for Sanders and am pretty much left of center.  I don't want government leaving the needy out in the cold, but for those who have to pay pensions, be it sociopathic corporations, or sociopathic governments, it's simply not viable to do so with the numbers people expect these days.  There is too much risk for the payers, and to do so would remove money from places it would be better spent, namely those who truly need it.

 

I totally understand that pensions happened for a perfectly valid reason.  But if they are going to continue to exist, they have to be modified in a way to make them sustainable.

Edited October 7, 2016 by BagBoy