re: what is your ideal 401 K balance at retirement?

He added it all up then did 7% interest.

I am hoping that my wife generates about $74,000-$93,000 annually from her TRSL pension.

I hope that her 403 & 457 generate somewhere around 1.8mm to $2.2mm. Probably on the lower end.

I hope that my 401k comes out to about $2mm flat even.

I also have some passive k-1 investments that should pay out for another 30 years. They are pretty lucrative.

It is amazing that she can shelter $49,000 in pre-tax retirement accounts alone.

What field are you in again?

I think ideal is over 1 million. Anything under 1 million and you risk dipping into your principle and not being able to leave that 1 million to your children. Ideally, you would want between 1.5-2 million. 1 million x 8% interest should give you 80k per year without touching the principle. Assuming you have paid off your house, you could live a nice old life. Personally, I do not have a 401(k) or any employer sponsored investments; however, I should have 1.1 million at a conservative flat rate of 8% average over the next 30 years in Roth IRA. If i bump that to 10%, it jumps to 1.6 million. I have already starting teaching my kids (4,2) on how to responsibly handle money. I do not want to leave 1 million to people who can't handle money, i'd rather leave it to charity.

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What are you folks needing to buy with 3 million once you hit your 60’s/ retirement age, assuming all your debts are paid off ??

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It's not what they will buy, but be able to maintain the life-style they had while working. For example, if you are 55 and make 240k per year, you would need 3 million at retirement to continue to generate interest to live off. 8% interest X 3 million replaces the 240k per year he was making at 55. You do not want to drop to 40k per year at retirement once you have become accustomed to living at 200k plus per year. That's why it is unwise for people to say, "my house is my retirement plan." Those people get their social security and have to sell the 400k house and move into a trailer park and try to live off 8% of 400k because SS sucks, if it will even be around much longer.

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Hell What I would like and reality aren’t the same. If you put the max amount in your 401k starting at say 22 years old ( currently 18,000 ) until your 65 ( over 50 is currently 24,000 ) and you were lucky enough to get a 7% return, you’d still only be at about 925,000. So good luck with a 2 million figure.

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Are you even factoring in compound interest?

If he is 22 with a yearly salary of 25k and an employer match of 50% and assuming a yearly salary increase of 3% and a 15% contribution per year, he would be looking at 1.7 million and that is not even contributing the max of 18k per year for most of his young life. This is the exact reason why people miss out on millions because they figure its not worth it but they do not understand compound interest. Then minus taxes. I would also contribute to a roth IRA in addition to the 401 though. Learn to live on less and invest the rest.


Brief education lesson on compound interest. You should not only factor in the contributions over the life of investment and times it by 7%. In compound interest, interest makes money on the interest and therefore, compounds yearly. This only works of course if you reinvest your earnings.

Yeah maybe that’s true..that’s spending $ 12,500 every month for 20 years... seems excessive for old people is all I’m getting at.

A lot of you guys are assuming you dont get divorced or your children dont become complete money pits.
Ive met multiple people starting over retirement /house everything else 2x or 3x depending on the divorces they would be living easy now.

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You also have to understand that a lot of posters in this thread are younger guys that still have decades to work. You have to remember that in 30 years, that $12,500 is not going to have the same buying power that $12,500 today has.

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For this exact reason is why people invest their money. To out perform inflation. So in fact, it doesn't matter if 12k isn't the same in 30 years. With a decent mutual fund yielding even 6% (which would be one of the horrible ones) you still will be inflation.

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What are you folks needing to buy with 3 million once you hit your 60’s/ retirement age, assuming all your debts are paid off ??

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People in this thread are discussing 2 different things.

1) building a retirement that will allow you to live off of dividends/interest without touching the principal

2) building a comfortable retirement.

The fear with #2 is that you are using your principal and may outlive your money.

The problem with #1 is that you aren't talking about retirement anymore. You are talking about passing on a sizeable estate to your legacy (which truthfully isn't the same thing).

The fear mongering about social security is a little ridiculous. If the US defaults on social security, then we are living in Mad Max. It isn't going to happen and if it does, we have bigger things to worry about.

That said, you cannot count on social security in the form that you understand it right now. And planning to not use social security is probably a good plan (i.e. you may not be able to access social security until you are 70 or older. Or the bigger issue is that the government will inflate the dollar so much that the promised payouts are worthless. For example, social security pays $250 for your funeral when you die. That is the same amount paid to us in the 1930s. A worker back in the 1950s thought they would be living great with their house paid for and receiving a $500/month social security check. That plan doesn't look so good right now).

Just do your best. Listen to advice. But don't presume that everyone else is speaking for you. The financial services industry likes to give half truths to further a self serving agenda.