One million dollars! New update but not so new.....#109

[Rukh O'Rorke]

Rukh O'Rorke net worth as of today!


$1,003,215.60

[Deleted]

Woohoo!  And you even have a little breathing room!  I just know when it finally happens to me it will be $1,000,003.12 and I won't want to buy lunch. 

[imawino]

Woo-hoo! Congratulations Rukh O'Rorke! You have been KILLING it at life!

[Rukh O'Rorke]

Feb 13, 2020 14:01:43 GMT -5 imawino said:

Woo-hoo! Congratulations Rukh O'Rorke! You have been KILLING it at life!

Thanks! It doesn't quite feel that way at the moment. A lot of stuff is not going so well, but, at least there is something positive

[HoneyBBQ]

WHOOOOO! 

[MN-Investor]

Woo-hoo!

And the very best thing of having $1M? It grows all on its own! You just sit back and watch it grow. It's magic!

[haapai]

I need to be happy for you.  You've done well.  It could not have been easy or have happened without planning.

And then...

This is not a good time to mention that having one million in 401(k) and traditional IRA accounts is vastly different from having a million socked away in Roth accounts, or a million accumulated in after-tax accounts or real estate equity. 

It astounds me that we agree to pretend that all of these assets are equally valuable. There appear to be no conventions for converting taxable assets into non-taxable equivalents.  This is kinda bonkers! 

[Deleted]

Feb 13, 2020 17:53:48 GMT -5 MN-Investor said:

Woo-hoo!

And the very best thing of having $1M? It grows all on its own! You just sit back and watch it grow. It's magic!

Yep. I LOVE compound interest!

I remember reading a post on CreditBoards.com 10+ years ago in which someone said that if only they had $1 million they could retire. Invest it at 8%/year, that's $80,000, you've got it made. I DID post back and note a few of the fallacies in that logic. Still, it's a great feeling.

[Rukh O'Rorke]

Feb 13, 2020 17:56:25 GMT -5 haapai said:

I need to be happy for you.  You've done well.  It could not have been easy or have happened without planning.

And then...

This is not a good time to mention that having one million in 401(k) and traditional IRA accounts is vastly different from having a million socked away in Roth accounts, or a million accumulated in after-tax accounts or real estate equity. 

It astounds me that we agree to pretend that all of these assets are equally valuable. There appear to be no conventions for converting taxable assets into non-taxable equivalents.  This is kinda bonkers! 

the one million includes 401k, Roth, HSAs, money market, company stock, RE equity.


Next milestones are 900k in liquid assets, and then the million in liquid, not counting home equity.


But today was a little bit of fun. You know, on top of all that horse manure that is life.....

[Rukh O'Rorke]

Feb 13, 2020 11:54:31 GMT -5 minnesotapaintlady said:

Woohoo!  And you even have a little breathing room!  I just know when it finally happens to me it will be $1,000,003.12 and I won't want to buy lunch. 

You're next!


and I'll buy you lunch!!

[Rukh O'Rorke]

Markets are closed! SP500 ended slightly higher and individual stocks still going good - so I made it. Lasted more than half a day so far!!!

[Rukh O'Rorke]

[Rukh O'Rorke]

[Rukh O'Rorke]

[debthaven]

Wow that is fantastic!!! And you did it all on your own!!!

[Deleted]

Feb 13, 2020 17:56:25 GMT -5 haapai said:

This is not a good time to mention that having one million in 401(k) and traditional IRA accounts is vastly different from having a million socked away in Roth accounts, or a million accumulated in after-tax accounts or real estate equity. 

It astounds me that we agree to pretend that all of these assets are equally valuable. There appear to be no conventions for converting taxable assets into non-taxable equivalents.  This is kinda bonkers! 

But in some ways it is.  $1 Million in 401K can indefinitely withdraw ~12,200/yr tax free.

Wiki says the poverty threshold for a single person was $11,700 in 2005.  

So it is a lot, as anyone with $1M is indefinitely no longer at risk of having to live in poverty. 


Add SS (which wouldn't be taxable at this level), assume that is the average $1,500/mo, so that would be a retirement income of $30K to any age.  

If you are a couple, that all gets double to $60K/yr income.  That is $75K pre-retirement, median household income in this country.  Since you only need 80% for retirement (remember that $75K had taxes, including SS/Medicare that you no longer have to pay), and guess what, you just succeed at using the 401K, as planned, to create a tax free retirement at the same quality of life from your working years ($60K/yr, inflation adjusted).  Because honestly, saving that $1M over a 40 year career isn't hard on a $75K income (only $550/mo @ at 6% return, which is a 9% market minus 3% inflation), or 8.8% of your income including company match, which most plans are 6% individual contribution to get a 3% company match.  

Seems 401K's were designed correctly and are a HUGE tax benefit.  The math shows how horrible everyone is at just doing the simplest of savings and that you just have to do it for your career.

[Happy prose]

That is awesome! Good job. 

[countrygirl2]

Great job we had about that much when hubs retired.  It was liquid at that time, now we have near that much but a few hundred thousand is tied up in income producing real estate, so a different animal now. Let's see, we had about $1.3 but we gave son about $150k and that's ok.  And we spent some.

If you are wise and guess you aren't retired yet so have more years to earn.  Congratulations and enjoy, its a wonderful feeling to know life in the future won't be so hard. If I had not spent so much we would have likely had $2, but its ok, we had fun!! And I'm happy I did now as I'm not so able anymore.

[ners]

Fantastic news Rukh O'Rorke

[buystoys]

Yay!  Doesn't it feel grand?

[Rukh O'Rorke]

Feb 14, 2020 8:44:59 GMT -5 buystoys said:

Yay!  Doesn't it feel grand?

Yeppers!

And looks like it will last for a bit. No sudden downturn as yet

Although - in some ways it's making things a little more difficult on the day to day, ironically. Gotta keep my eye on the prize and head in the game - BS at work is really wearing me down. I can't walk away yet - I live in a HCOL area and this money would evaporate quickly if I stopped bringing home the roasted eggplant strips on the regular. I wish a million meant the same thing as a million when I was a kid!! 

But the fantasy of walking away from everything - at a languid, measured pace in slow motion with the big explosion behind me - is sooooo tempting. But I got to hit the 2 million mark with paid off house/paid off student loans to be really secure/maintain current life. That seems like a very long way off and I honestly don't think I'll make it. We'll see how long I last!

I know I have options at this level of savings, and I'm very grateful about that! I think the nomad in a camper van life is at least secured right now - but it would be a stretch - honestly. I'm 6.8 years away from earliest social security and almost 10 years out from medicare. The vast majority of my investments are in protected retirement vehicles. Although I can access current employers plan if I separate - rule of 55 - there is only 30-odd k in there.  Still got the rocking horse winner whispering in my ear "there must be more money! there must be more money!" 

Thankfully - the market is still kicking in today. And I still have the steady paycheck and benefits. 

Gotta keep moving!

[Rukh O'Rorke]

Feb 13, 2020 19:36:50 GMT -5 @logicnow said:

Feb 13, 2020 17:56:25 GMT -5 haapai said:

This is not a good time to mention that having one million in 401(k) and traditional IRA accounts is vastly different from having a million socked away in Roth accounts, or a million accumulated in after-tax accounts or real estate equity. 

It astounds me that we agree to pretend that all of these assets are equally valuable. There appear to be no conventions for converting taxable assets into non-taxable equivalents.  This is kinda bonkers! 

But in some ways it is.  $1 Million in 401K can indefinitely withdraw ~12,200/yr tax free.

Wiki says the poverty threshold for a single person was $11,700 in 2005.  

So it is a lot, as anyone with $1M is indefinitely no longer at risk of having to live in poverty. 


Add SS (which wouldn't be taxable at this level), assume that is the average $1,500/mo, so that would be a retirement income of $30K to any age.  

If you are a couple, that all gets double to $60K/yr income.  That is $75K pre-retirement, median household income in this country.  Since you only need 80% for retirement (remember that $75K had taxes, including SS/Medicare that you no longer have to pay), and guess what, you just succeed at using the 401K, as planned, to create a tax free retirement at the same quality of life from your working years ($60K/yr, inflation adjusted).  Because honestly, saving that $1M over a 40 year career isn't hard on a $75K income (only $550/mo @ at 6% return, which is a 9% market minus 3% inflation), or 8.8% of your income including company match, which most plans are 6% individual contribution to get a 3% company match.  

Seems 401K's were designed correctly and are a HUGE tax benefit.  The math shows how horrible everyone is at just doing the simplest of savings and that you just have to do it for your career.

roughly 15% of my liquid assets are in Roth, maybe 1% in HSAs.

Most is in 401ks but I am not too worried about that - as long as I don't have to withdraw in a penalty+taxes situation. As you state, there is a measure of control you can exert on how much to take out at any given time and what the tax consequences may be.

I'll anticipate some taxes, but hoping to keep it at a minimum and transfer some at very low tax rates into taxable account as I go along. All depends on other income if I semi-retire and what yearly expenses may be. But all bridges I am unfortunately not yet ready to cross.  

[finnime]

Congratulations, Rukh O'Rorke!

[buystoys]

Feb 14, 2020 10:11:39 GMT -5 Rukh O'Rorke said:

Feb 14, 2020 8:44:59 GMT -5 buystoys said:

Yay!  Doesn't it feel grand?

Yeppers!

And looks like it will last for a bit. No sudden downturn as yet

Although - in some ways it's making things a little more difficult on the day to day, ironically. Gotta keep my eye on the prize and head in the game - BS at work is really wearing me down. I can't walk away yet - I live in a HCOL area and this money would evaporate quickly if I stopped bringing home the roasted eggplant strips on the regular. I wish a million meant the same thing as a million when I was a kid!! 

But the fantasy of walking away from everything - at a languid, measured pace in slow motion with the big explosion behind me - is sooooo tempting. But I got to hit the 2 million mark with paid off house/paid off student loans to be really secure/maintain current life. That seems like a very long way off and I honestly don't think I'll make it. We'll see how long I last!

I know I have options at this level of savings, and I'm very grateful about that! I think the nomad in a camper van life is at least secured right now - but it would be a stretch - honestly. I'm 6.8 years away from earliest social security and almost 10 years out from medicare. The vast majority of my investments are in protected retirement vehicles. Although I can access current employers plan if I separate - rule of 55 - there is only 30-odd k in there.  Still got the rocking horse winner whispering in my ear "there must be more money! there must be more money!" 

Thankfully - the market is still kicking in today. And I still have the steady paycheck and benefits. 

Gotta keep moving!

Don't forget that your million is working to make you more, so getting to the $2M point won't take you nearly as long.  It's good to have your money working for you!

[haapai]

Feb 13, 2020 19:36:50 GMT -5 @logicnow said:

Feb 13, 2020 17:56:25 GMT -5 haapai said:

This is not a good time to mention that having one million in 401(k) and traditional IRA accounts is vastly different from having a million socked away in Roth accounts, or a million accumulated in after-tax accounts or real estate equity. 

It astounds me that we agree to pretend that all of these assets are equally valuable. There appear to be no conventions for converting taxable assets into non-taxable equivalents.  This is kinda bonkers! 

But in some ways it is.  $1 Million in 401K can indefinitely withdraw ~12,200/yr tax free.

Wiki says the poverty threshold for a single person was $11,700 in 2005.  

So it is a lot, as anyone with $1M is indefinitely no longer at risk of having to live in poverty. 


Add SS (which wouldn't be taxable at this level), assume that is the average $1,500/mo, so that would be a retirement income of $30K to any age.  

If you are a couple, that all gets double to $60K/yr income.  That is $75K pre-retirement, median household income in this country.  Since you only need 80% for retirement (remember that $75K had taxes, including SS/Medicare that you no longer have to pay), and guess what, you just succeed at using the 401K, as planned, to create a tax free retirement at the same quality of life from your working years ($60K/yr, inflation adjusted).  Because honestly, saving that $1M over a 40 year career isn't hard on a $75K income (only $550/mo @ at 6% return, which is a 9% market minus 3% inflation), or 8.8% of your income including company match, which most plans are 6% individual contribution to get a 3% company match.  

Seems 401K's were designed correctly and are a HUGE tax benefit.  The math shows how horrible everyone is at just doing the simplest of savings and that you just have to do it for your career.

Believe me, I wasn't throwing shade on the amount.  (I mentally moved a decimal over when you doing the one-million-401(k) math.)  It's throwing home equity into the mix and counting Roth and trad accounts equally that bugs me.  Some of those account balances should be discounted heavily (or the other accounts grossed-up) when attempting to weigh them. 

We all seem to have agreed not to ever do any such math, which strikes me as illogical. 

[Rukh O'Rorke]

what a killjoy.

[azucena]

Your good news made me check mine.  My 401k crossed over $400k, up $25k since yearend!

[hoops902]

Feb 13, 2020 19:36:50 GMT -5 @logicnow said:

Feb 13, 2020 17:56:25 GMT -5 haapai said:

This is not a good time to mention that having one million in 401(k) and traditional IRA accounts is vastly different from having a million socked away in Roth accounts, or a million accumulated in after-tax accounts or real estate equity. 

It astounds me that we agree to pretend that all of these assets are equally valuable. There appear to be no conventions for converting taxable assets into non-taxable equivalents.  This is kinda bonkers! 

But in some ways it is.  $1 Million in 401K can indefinitely withdraw ~12,200/yr tax free.

Wiki says the poverty threshold for a single person was $11,700 in 2005.  

So it is a lot, as anyone with $1M is indefinitely no longer at risk of having to live in poverty. 


Add SS (which wouldn't be taxable at this level), assume that is the average $1,500/mo, so that would be a retirement income of $30K to any age.  

If you are a couple, that all gets double to $60K/yr income.  That is $75K pre-retirement, median household income in this country.  Since you only need 80% for retirement (remember that $75K had taxes, including SS/Medicare that you no longer have to pay), and guess what, you just succeed at using the 401K, as planned, to create a tax free retirement at the same quality of life from your working years ($60K/yr, inflation adjusted).  Because honestly, saving that $1M over a 40 year career isn't hard on a $75K income (only $550/mo @ at 6% return, which is a 9% market minus 3% inflation), or 8.8% of your income including company match, which most plans are 6% individual contribution to get a 3% company match.  

Seems 401K's were designed correctly and are a HUGE tax benefit.  The math shows how horrible everyone is at just doing the simplest of savings and that you just have to do it for your career.

You have to do it for your career, but the average person isn't waking up on Day 1 of a 40 year career making $75k.  You're also talking about HAVING $1M in TODAY'S DOLLARS...which means STARTING 40 years ago when the median household income was less than $20,000/year.  It's a lot different putting away $6600/year on $75k than having to put away $6600/year making $20k in 1980 in order to get started for 40 years of contributing (and we all know those early years are the most important to compounding)

[hoops902]

Feb 14, 2020 13:31:31 GMT -5 haapai said:

Feb 13, 2020 19:36:50 GMT -5 @logicnow said:

But in some ways it is.  $1 Million in 401K can indefinitely withdraw ~12,200/yr tax free.

Wiki says the poverty threshold for a single person was $11,700 in 2005.  

So it is a lot, as anyone with $1M is indefinitely no longer at risk of having to live in poverty. 


Add SS (which wouldn't be taxable at this level), assume that is the average $1,500/mo, so that would be a retirement income of $30K to any age.  

If you are a couple, that all gets double to $60K/yr income.  That is $75K pre-retirement, median household income in this country.  Since you only need 80% for retirement (remember that $75K had taxes, including SS/Medicare that you no longer have to pay), and guess what, you just succeed at using the 401K, as planned, to create a tax free retirement at the same quality of life from your working years ($60K/yr, inflation adjusted).  Because honestly, saving that $1M over a 40 year career isn't hard on a $75K income (only $550/mo @ at 6% return, which is a 9% market minus 3% inflation), or 8.8% of your income including company match, which most plans are 6% individual contribution to get a 3% company match.  

Seems 401K's were designed correctly and are a HUGE tax benefit.  The math shows how horrible everyone is at just doing the simplest of savings and that you just have to do it for your career.

Believe me, I wasn't throwing shade on the amount.  (I mentally moved a decimal over when you doing the one-million-401(k) math.)  It's throwing home equity into the mix and counting Roth and trad accounts equally that bugs me.  Some of those account balances should be discounted heavily (or the other accounts grossed-up) when attempting to weigh them. 

We all seem to have agreed not to ever do any such math, which strikes me as illogical. 

My take is that we never do any such math because none of us REALLY puts any stock into the idea of "net worth".  You can't live off of net worth, so it's a fun little meaningless thing to track/proclaim, but it is unimportant.  

The other piece is that traditional accounts can have such a massive degree of manipulation by making intelligent tax moves, that their value can't be realistically deciphered until you're in the moment and taking the money out.  The value is primarily in the idea that for a post-tax account you have freedom to take money more as you please...it's difficult to value that freedom over the freedom of a pre-tax account in dollars (because again, intelligent planning and manipulation for tax purposes can drastically change the real-dollar impact).

[Rukh O'Rorke]

Feb 14, 2020 17:17:05 GMT -5 azucena said:

Your good news made me check mine.  My 401k crossed over $400k, up $25k since yearend!

Yay!!     Milestones are the best!

It's so great to be able to share this kin of stuff here. I think it just adds strain to the in-person crowd.