Retirement Savings now at 4.3 trillion $ in US

[theeedude]

I am 27, a little under $350K saved and invested, well over 50% of what I earned since graduation.
Being low maintenance and somewhat lucky at investing FTW. Some of it is being invested for a down payment (once housing finishes dropping) outside retirement.
But majority is in 401K and some in Roth IRA. I am guessing majority of it will go to charity when I die, since I am not really a big spender and I don't plan to leave anyone an inheritance.

 

[Drakkon]

Working for the state of nevada is interesting. I actually do not have to pay into social security - only medicare. Instead I have to contribute a mandatory 10% to a state 401k plan which is automatically matched 100% and immediately vested. That seemed like a helluva deal to me so long as I dont expect any social security later on (which i dont anyways - I'm only 26).

 

[BigJelly]

Originally posted by: Drakkon
Working for the state of nevada is interesting. I actually do not have to pay into social security - only medicare. Instead I have to contribute a mandatory 10% to a state 401k plan which is automatically matched 100% and immediately vested. That seemed like a helluva deal to me so long as I dont expect any social security later on (which i dont anyways - I'm only 26).

wish i didn't have to contibute to SS given that i'll never see a dime of it--im 24

would be nice if we could opt out of it:
make the 6.25% that the employer pays and 6.25% that I pay go into the 401k.

We wouldn't need SS if they allowed people to opt out if they want too--be nice if we had a choice instead of being forced into it.

 

[Pliablemoose]

Originally posted by: BigJelly

Originally posted by: Drakkon
Working for the state of nevada is interesting. I actually do not have to pay into social security - only medicare. Instead I have to contribute a mandatory 10% to a state 401k plan which is automatically matched 100% and immediately vested. That seemed like a helluva deal to me so long as I dont expect any social security later on (which i dont anyways - I'm only 26).

wish i didn't have to contibute to SS given that i'll never see a dime of it--im 24

would be nice if we could opt out of it:
make the 6.25% that the employer pays and 6.25% that I pay go into the 401k.

We wouldn't need SS if they allowed people to opt out if they want too--be nice if we had a choice instead of being forced into it.

I hear you on the SS $, unfortunately you're too stupid to invest your SS $ according to congress 🙁

 

[Rainsford]

Originally posted by: Pliablemoose

Originally posted by: BigJelly

Originally posted by: Drakkon
Working for the state of nevada is interesting. I actually do not have to pay into social security - only medicare. Instead I have to contribute a mandatory 10% to a state 401k plan which is automatically matched 100% and immediately vested. That seemed like a helluva deal to me so long as I dont expect any social security later on (which i dont anyways - I'm only 26).

wish i didn't have to contibute to SS given that i'll never see a dime of it--im 24

would be nice if we could opt out of it:
make the 6.25% that the employer pays and 6.25% that I pay go into the 401k.

We wouldn't need SS if they allowed people to opt out if they want too--be nice if we had a choice instead of being forced into it.

I hear you on the SS $, unfortunately you're too stupid to invest your SS $ according to congress 🙁

At least get the terms right before opening your big yap. It's not "your" social security money, that's not how the system works. But you knew that...

 

[Pliablemoose]

Originally posted by: Rainsford

Originally posted by: Pliablemoose

Originally posted by: BigJelly

Originally posted by: Drakkon
Working for the state of nevada is interesting. I actually do not have to pay into social security - only medicare. Instead I have to contribute a mandatory 10% to a state 401k plan which is automatically matched 100% and immediately vested. That seemed like a helluva deal to me so long as I dont expect any social security later on (which i dont anyways - I'm only 26).

wish i didn't have to contibute to SS given that i'll never see a dime of it--im 24

would be nice if we could opt out of it:
make the 6.25% that the employer pays and 6.25% that I pay go into the 401k.

We wouldn't need SS if they allowed people to opt out if they want too--be nice if we had a choice instead of being forced into it.

I hear you on the SS $, unfortunately you're too stupid to invest your SS $ according to congress 🙁

At least get the terms right before opening your big yap. It's not "your" social security money, that's not how the system works. But you knew that...

Yep, I did. Thanks FDR 🙁

 

[bctbct]

Originally posted by: BigJelly

Originally posted by: Drakkon
Working for the state of nevada is interesting. I actually do not have to pay into social security - only medicare. Instead I have to contribute a mandatory 10% to a state 401k plan which is automatically matched 100% and immediately vested. That seemed like a helluva deal to me so long as I dont expect any social security later on (which i dont anyways - I'm only 26).

wish i didn't have to contibute to SS given that i'll never see a dime of it--im 24

would be nice if we could opt out of it:
make the 6.25% that the employer pays and 6.25% that I pay go into the 401k.

We wouldn't need SS if they allowed people to opt out if they want too--be nice if we had a choice instead of being forced into it.

actually if you were disabled tommorrow you would see every dime and then some.

 

[BigJelly]

Originally posted by: bctbct

Originally posted by: BigJelly

Originally posted by: Drakkon
Working for the state of nevada is interesting. I actually do not have to pay into social security - only medicare. Instead I have to contribute a mandatory 10% to a state 401k plan which is automatically matched 100% and immediately vested. That seemed like a helluva deal to me so long as I dont expect any social security later on (which i dont anyways - I'm only 26).

wish i didn't have to contibute to SS given that i'll never see a dime of it--im 24

would be nice if we could opt out of it:
make the 6.25% that the employer pays and 6.25% that I pay go into the 401k.

We wouldn't need SS if they allowed people to opt out if they want too--be nice if we had a choice instead of being forced into it.

actually if you were disabled tommorrow you would see every dime and then some.

I'd rather take my chances--but the government doesn't give me a CHOICE

 

[shadow9d9]

Originally posted by: BigJelly

Originally posted by: bctbct

Originally posted by: BigJelly

Originally posted by: Drakkon
Working for the state of nevada is interesting. I actually do not have to pay into social security - only medicare. Instead I have to contribute a mandatory 10% to a state 401k plan which is automatically matched 100% and immediately vested. That seemed like a helluva deal to me so long as I dont expect any social security later on (which i dont anyways - I'm only 26).

wish i didn't have to contibute to SS given that i'll never see a dime of it--im 24

would be nice if we could opt out of it:
make the 6.25% that the employer pays and 6.25% that I pay go into the 401k.

We wouldn't need SS if they allowed people to opt out if they want too--be nice if we had a choice instead of being forced into it.

actually if you were disabled tommorrow you would see every dime and then some.

I'd rather take my chances--but the government doesn't give me a CHOICE

People like you would take their chances until it happened to them, and then complain etc.

 

[BigJelly]

Originally posted by: shadow9d9

Originally posted by: BigJelly

Originally posted by: bctbct

Originally posted by: BigJelly

Originally posted by: Drakkon
Working for the state of nevada is interesting. I actually do not have to pay into social security - only medicare. Instead I have to contribute a mandatory 10% to a state 401k plan which is automatically matched 100% and immediately vested. That seemed like a helluva deal to me so long as I dont expect any social security later on (which i dont anyways - I'm only 26).

wish i didn't have to contibute to SS given that i'll never see a dime of it--im 24

would be nice if we could opt out of it:
make the 6.25% that the employer pays and 6.25% that I pay go into the 401k.

We wouldn't need SS if they allowed people to opt out if they want too--be nice if we had a choice instead of being forced into it.

actually if you were disabled tommorrow you would see every dime and then some.

I'd rather take my chances--but the government doesn't give me a CHOICE

People like you would take their chances until it happened to them, and then complain etc.

People like me believe it's my choice and not the governments

 

[homercles337]

Yay! Another brag thread at AT. I make $500k a year, im 24, and i have $500k in my IRA, ROTH, 401k, each. :roll:

edit: The fact is, this is one of the first times in american history where savings are in the red. Yes, this means that in general americans are not saving at all. Now, i have to go look into this OP. :|

 

[IGBT]

Originally posted by: Naustica
Social Security will be plenty for me.

..:laugh:

 

[child of wonder]

My wife and I started saving a year ago. So far we've got around $11,000 saved in 401k combined.

I'm 28 and she's 24.

Our goal is to have me retire and do only consulting when I'm 59 until age 63 and she will fully retire at 59 1/2.

 

[Pliablemoose]

Originally posted by: homercles337
Yay! Another brag thread at AT. I make $500k a year, im 24, and i have $500k in my IRA, ROTH, 401k, each. :roll:

edit: The fact is, this is one of the first times in american history where savings are in the red. Yes, this means that in general americans are not saving at all. Now, i have to go look into this OP. :|

Didn't mean to offend you, I drive old cars, bought a house I could afford and cut corners every damn place I can to save a buck. You don't have to make a six figure income to have some personal savings, you just have to learn to reject how we're freaking programmed to spend more than we make.

I could get laid 2-3X as much if I'd spring for a Mercedes or a BMW... is it worth it to me? Hell no.

The most common auto owned by millionaires in the US? A humble Ford F150.

 

[StageLeft]

Yep, the other thing to consider is that even if no matching or you plan on leaving prior to being vested is that you keep the interest/returns the employer matching generates when you leave.

This is a lesson I recently learned. Mrsskoorb left an employer and most of what she contributed was vested but I wanted it moved out of their 401k into a rollover IRA, so I just got the check in the mail and it shows a full G that could have vested but now will not. I've not sent the check over to Vanguard yet (new IRA holder). I presume it's too late to go back to the original plan holder and say "oops, I didn't mean to disburse it". I just assumed that it was punishment for leaving an employer that you'd lose your non-vested, but then it occured to me that the money has already left their hands anyway so I'm not quite sure what the point of a slow-vesting is anyway; if the employer is out of cash, why not just vest everything immediately?

 

[Genx87]

Turning 30 next week. Never enough in the old retirement fund.
I am doing ok for myself, but I wouldnt say it is extraordinary. Might have got in a little over my head with my house. Time will heal that as my wages increase faster than inflation though.

 

[Pliablemoose]

Originally posted by: Skoorb

Yep, the other thing to consider is that even if no matching or you plan on leaving prior to being vested is that you keep the interest/returns the employer matching generates when you leave.

This is a lesson I recently learned. Mrsskoorb left an employer and most of what she contributed was vested but I wanted it moved out of their 401k into a rollover IRA, so I just got the check in the mail and it shows a full G that could have vested but now will not. I've not sent the check over to Vanguard yet (new IRA holder). I presume it's too late to go back to the original plan holder and say "oops, I didn't mean to disburse it". I just assumed that it was punishment for leaving an employer that you'd lose your non-vested, but then it occured to me that the money has already left their hands anyway so I'm not quite sure what the point of a slow-vesting is anyway; if the employer is out of cash, why not just vest everything immediately?

You're 1/2 way there Skoorb.

Vesting means you get to keep the $ your employer contributes & or matches.

It's also done in several different ways, my current employer has a graduated vesting:

After 2 years of continuous employment I get to keep 25% of the $ they contributed
After 3 years I keep 50%
After 4 years I keep 75%
After 5 years of I keep 100%

My 2nd year anniversary is tomorrow, and I get to keep 25% of the $ if I quit or am terminated. I anticipate staying till I'm vested 100%, but it feels good to know I keep some of it after tomorrow.

They calculate vesting by years of continuous employment, after separation the clock stops.

Edit, just looked, seems I'm 25% vested today


Source................Source Balance.............................Vested Balance
Pre Tax...................$20,255.79.....................................$20,255.79
Employer Match.........$8,031.89.......................................$2,007.97
Total:......................$28,287.68.....................................$22,263.76

 

[theeedude]

Wow, that puts Iraq and Afghanistan cost of 2.4 Trillion in perspective. We are spending the equivalent of more than 50% of our retirement savings on the Iraq mess.

 

[LegendKiller]

Originally posted by: Pabster

Originally posted by: Pliablemoose
I wouldn't mess around with bonds till you're really set for your retirement, the returns suck.

Yep, but they're a critical part of any diversified portfolio.

No, they aren't.

 

[Pabster]

Originally posted by: LegendKiller
No, they aren't.

Glad you aren't managing my retirement funds :laugh:

 

[Pliablemoose]

Originally posted by: LegendKiller

Originally posted by: Pabster

Originally posted by: Pliablemoose
I wouldn't mess around with bonds till you're really set for your retirement, the returns suck.

Yep, but they're a critical part of any diversified portfolio.

No, they aren't.

Agreed, bonds are useful for some very specific investment goals, growing your retirement isn't one of them.

 

[LegendKiller]

Originally posted by: Pabster

Originally posted by: LegendKiller
No, they aren't.

Glad you aren't managing my retirement funds :laugh:

Glad you don't work on Wall St.

Bonds, as a diversification tool, are good, since the correlation to stocks isn't all that high. However, it's a drag on a portfolio. They are great to sustain principal value, sure, but they are still a drag. The 2nd best diviersifier of a portfolio, is not bonds, it is time. Sure, you should always have at least 10 different stocks, or invest in index or mutuals, but that diversification combined with time beats the snot out of any stock + bond portfolio you can have.

Bonds are great at protecting the downside, but if time more or less guarantees you will always go up, unless you think we will fall off a cliff, then protecting from the downside is a waste of time. If anything, you're loosing even more money by doing so, because if you buy all stocks on the downside, rather than bonds, you're eliminating a massive chunk of your equity appreciation once the economic cycle turns.

Unless you are within 10 years of retirement, you should never invest in bonds. This is coming from a guy who actually sells bonds for a living. But I sell them to people who need to protect principal while returning a decent amount of money. Insurance companies, pension funds, mutual funds...etc.

 

[piasabird]

Chances are that many people will or could lose their jobs and have to spend money they would rather not. There is a good chance you will have to live through a depression or a recession in your lifetime that will wipe out your savings. You can hope for the best but you may learn that the best does not always happen. I wish you luck. I dont believe people should be able to opt out of SS, but I also done believe it should be in the general revenue fund. That is not the way FDR set it up. It was stolen by Congress, and they should have to pay back every penny.

 

[LegendKiller]

Originally posted by: piasabird
Chances are that many people will or could lose their jobs and have to spend money they would rather not. There is a good chance you will have to live through a depression or a recession in your lifetime that will wipe out your savings. You can hope for the best but you may learn that the best does not always happen. I wish you luck. I dont believe people should be able to opt out of SS, but I also done believe it should be in the general revenue fund. That is not the way FDR set it up. It was stolen by Congress, and they should have to pay back every penny.

It wasn't stolen by Congress, it was stolen by us.

 

[LongTimePCUser]

You need to revise the question:
"Over 40 years old >$100K retirement savings"

You need to have a question like:
"Over 60 years old >$1000 K retirement savings"

or:
"Over 40 years old and on target to have >$1000K retirement savings at age 65"

One real problem for a 40 year old is that they may have children in college and may not be able to add to their savings until all their children graduate.

Go back and take a look at the books and web sites that advise retirees on how to invest their retirement savings and how much money they can safely withdraw each year.

Based on historical evidence they advise retirees to withdraw no more than 4% of their savings each year. Increase that amount by inflation each year to preserve your standard of living.

If you withdraw 4% of 100K that would be $4000 /year.
You will not be able to live on that.

4% of $1 million is $40K/year. That should be a reasonable target goal for a comfortable retirement.

The usual financial advise is to invest in a diversified portfolio including stocks, bonds, cash and real estate in order to make sure you can survive inflation and investment loses. Typically they look at the time period 1968 - 1980. If you started in 1968 and withdrew 7% /year then you would be totally bankrupt by about 1978.

4%/year withdrawal is considered safe.
Saving and investing 10 - 20% of your salary / year in a tax deferred account will probably get you to your goals.

If you want to look at a more sofisticated retirement calculator go to the Fidelity web site.
Fidelity retirement calculators