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

[hoops902]

Feb 17, 2020 12:33:51 GMT -5 phil5185 said:

"" because the premise is that the average person simply makes 75k/year....which they don't."""

logicnow  stated STEM majors, not average persons.

Yes, but the claim was the average person can do it...to which I responded they cannot, to which logicnow said "STEM majors can"...as if the average person is a STEM major.  Any major CAN...that's anecdotal, and likely to apply to nearly anyone with any degree or not...SOMEONE in a given group is likely to make $75k in some way or another.

[Deleted]

Feb 15, 2020 20:39:20 GMT -5 Rukh O'Rorke said:

Feb 15, 2020 13:18:36 GMT -5 @logicnow said:

Ok, first I said I wasn't very grounded.  Second, while I understand the in-ability to reach the million dollar mark, I don't understand the save nothing. So because you can only save $100/mo instead of $500/mo you decide to just "enjoy" the $100/mo on stupid stuff then complain when you live life broke, when you would end up with $50k, $100K, $200K in your 40s, 50s, 60s respectively.  

Ironically, savings becomes addictive, once you learn the delayed gratification and just how much of that "stuff" is a waste of money you tend to focus on the items that matter more (time spend doing something versus the next latest gadget).

Who are you lecturing?

Sorry, not lecturing, just an honest question, as everyone always gives an excuse and always says it is easy because of my high income.  But many of my peers with the same high income, same lack of children, live pay check to pay check.  Also, even when I made very little money (i.e. minimum wage), I always saved some of it.

Anyhow, Congrats on the milestone!

[Deleted]

Feb 17, 2020 9:20:19 GMT -5 minnesotapaintlady said:

Feb 14, 2020 18:31:56 GMT -5 @logicnow said:

STEM majors do, that is what I pay to recruit them.  That is what I made my first job out of college when adjusted for inflation. Even if you don't, most households would if both people making ~$30K saved prior to marriage and salary growth, thus making it even worse that more households don't achieve this milestone.


Finally, I did it in ~20 years with a ~20% savings rate (3% was always from my company).
    Year 1:  0% (locked out of plan)
    Year 2:  18%
    Year 3-7:  16%
    Years 7-now:  25% then a linear fall to 12% (yeah high income but those hard dollar limits suck)

I'm not very grounded as I'm astounded more people aren't wealthy as it really has been easy.      
    

I'm a STEM major!  I'm not even close to 75K yet and probably will never hit it before I retire.  My Ex is making about that as a math major working IT for a large company, but he's been there 24 years.  But, your percentages reminded me that I've been tracking that.  I didn't work 2003 through most of 2005 and don't know how much I put into retirement each year before then, just that I had 80K in my IRAs in 2004. 

So, obviously I know how to save and I've been doing it my entire working life, but it's been very HARD, especially with kids and college funds.  I'm nowhere near 1 million in retirement accounts.

Ok, thanks for providing the data to PROVE my point.  You should be on-track to be a millionaire in the next 5-7 years.  But even if you don't contribute another dollar should reach that status based on the contributions listed. 

So the $80K in 2004, in the S&P 500 would be worth 238,400 today:  dqydj.com/sp-500-return-calculator/ (298% increase with dividends re-invested)

Then I add up 119,950 in 401K (Contribution and Company Match) and 68,500 in Roth IRA = 188,450 (I started my current job in 2005 and thus can find a multiplier similar to the above link from my data, with consistent contributions like you, my value is 2.15 of the contributions).  So applying that for your data = $405,167.  Note:  This is a harder number to cite a source that quickly converts, but the same time period from my link above would be:  2.75 for reference.

So you should have a retirement total = $643,567 TODAY if you have been investing in the market (if not then, I'm sorry and not trying to be mean, but our guidance on the board is failing people).  If you contribute 0 more dollars, wait until age 65 to retire you will be an inflation adjusted Million at age 65.  With only a 3% return over 15 years (1.03^15 = 1.56 * $643,567 = $1,002,657)!!

Congratulations, you are in coast mode to being a Millionaire!!!   Actually, you will hit the $1,000,000 mark sooner as the 3% return is only required after inflation but with 2-3% inflation and long term markets that can reach 10-11% return it will come much sooner (likely in the next 5 years with continued contributions). 

FYI .. If your retirement accounts don't currently have a balance of >$500,000, then please post your portfolio, as I would really like to see why with good contributions pre-2009 and this bull market you haven't achieved better returns, or where my math is in error.  Either you are paying huge fees in a bad 401K, have to much bond allocation, or I missed something.  Also, don't feel bad, I think the financial advisers are crazy for recommending high bond percentages at low ages for people.  I have yet to find a time period in the market with a bear market longer than 10 years, so personally feel people don't need hardly any bonds until they are 10 year out from retiring.  

[Deleted]

Feb 17, 2020 22:08:30 GMT -5 @logicnow said:

So the $80K in 2004, in the S&P 500 would be worth 238,400 today:  dqydj.com/sp-500-return-calculator/ (298% increase with dividends re-invested)

225K, but only because 1/4 of  that 80K was in FLPSX which is now worth over 140K alone.  The bonds, international fund and science and tech...not so great.  I read a lot about investing back in my 20's, but it was all diversify, a little here, a little there... I lucked out with one good fund. 

So you should have a retirement total = $643,567 TODAY if you have been investing in the market (if not then, I'm sorry and not trying to be mean, but our guidance on the board is failing people).

540K.  Some bonds, some emerging markets dragging things down.  It's only been the past 10 or 15 years that I've been moving to mainly S&P.  (but now that I hear that 20% of the S&P is just a few stocks that worries me a little too.  

My point is, it's been nearly 30 years and it has not been easy at all.  I'm still only halfway to being able to draw 40K/year in retirement!   I drive a POS van and never go out to eat.  I don't remember when the last time I bought myself new clothes. I'm just really lucky that I've been healthy and the kids have been healthy and I have a good support system, things probably would have been way different otherwise. 

[hoops902]

Feb 17, 2020 22:54:25 GMT -5 minnesotapaintlady said:

Feb 17, 2020 22:08:30 GMT -5 @logicnow said:

So the $80K in 2004, in the S&P 500 would be worth 238,400 today:  dqydj.com/sp-500-return-calculator/ (298% increase with dividends re-invested)

225K, but only because 1/4 of  that 80K was in FLPSX which is now worth over 140K alone.  The bonds, international fund and science and tech...not so great.  I read a lot about investing back in my 20's, but it was all diversify, a little here, a little there... I lucked out with one good fund. 

So you should have a retirement total = $643,567 TODAY if you have been investing in the market (if not then, I'm sorry and not trying to be mean, but our guidance on the board is failing people).

540K.  Some bonds, some emerging markets dragging things down.  It's only been the past 10 or 15 years that I've been moving to mainly S&P.  (but now that I hear that 20% of the S&P is just a few stocks that worries me a little too.  

My point is, it's been nearly 30 years and it has not been easy at all.  I'm still only halfway to being able to draw 40K/year in retirement!   I drive a POS van and never go out to eat.  I don't remember when the last time I bought myself new clothes. I'm just really lucky that I've been healthy and the kids have been healthy and I have a good support system, things probably would have been way different otherwise. 

Ok, but that's ok compared to the original idea of "40 years", because in another 10 years your money should double (on average every 7 years roughly).  To me, that's one of the great examples of investment...7 years from retirement you might FEEL waaaaaaaay behind because you're only halfway there, and then BAM, it doubles and you're there.  It takes 30 years to reach 540k, and only 7-10 more to reach 1080k.

[thyme4change]

Feb 18, 2020 8:43:31 GMT -5 hoops902 said:

Feb 17, 2020 22:54:25 GMT -5 minnesotapaintlady said:

225K, but only because 1/4 of  that 80K was in FLPSX which is now worth over 140K alone.  The bonds, international fund and science and tech...not so great.  I read a lot about investing back in my 20's, but it was all diversify, a little here, a little there... I lucked out with one good fund. 


540K.  Some bonds, some emerging markets dragging things down.  It's only been the past 10 or 15 years that I've been moving to mainly S&P.  (but now that I hear that 20% of the S&P is just a few stocks that worries me a little too.  

My point is, it's been nearly 30 years and it has not been easy at all.  I'm still only halfway to being able to draw 40K/year in retirement!   I drive a POS van and never go out to eat.  I don't remember when the last time I bought myself new clothes. I'm just really lucky that I've been healthy and the kids have been healthy and I have a good support system, things probably would have been way different otherwise. 

Ok, but that's ok compared to the original idea of "40 years", because in another 10 years your money should double (on average every 7 years roughly).  To me, that's one of the great examples of investment...7 years from retirement you might FEEL waaaaaaaay behind because you're only halfway there, and then BAM, it doubles and you're there.  It takes 30 years to reach 540k, and only 7-10 more to reach 1080k.

It is truly amazing how your wealth expands exponentially as you get more money. That old joke "The first million is the hardest" is really no joke. It takes decades, clawing and sacrificing and you reach a million and you panic because your dont have it in you to do it again, and then a couple of years, and a good market rally and bam - million and a half. And you look around and you think, wait...what just happened? But in a good way!

[Deleted]

Of course, it could just as likely drop 20% tomorrow and we go into a recession for the next 2-3 years, so that in 5-7 I've HOPEFULLY regained the losses.  

[thyme4change]

Feb 18, 2020 8:59:52 GMT -5 minnesotapaintlady said:

Of course, it could just as likely drop 20% tomorrow and we go into a recession for the next 2-3 years, so that in 5-7 I've HOPEFULLY regained the losses.  

Shhhhhhh

This is a board of hope.

[swamp]

Feb 14, 2020 18:31:56 GMT -5 @logicnow said:

Feb 14, 2020 17:17:14 GMT -5 hoops902 said:

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)

Sorry, I'm going to disagree, I corrected for inflation in my example. So saving 6% of your salary would get you to the million mark in today's dollars no matter what year you started.  Obviously if you started 60 years ago, you wouldn't hit the # on statements, but you would have the same buying power in 2000 that $1 Million gives you today in 2020.

(only $550/mo @ at 6% return, which is a 9% market minus 3% inflation)

The S&P 500 has returned an average return just as I state, look various 40 year period on this site and you will see I was very reasonable (https://dqydj.com/sp-500-return-calculator/).  The 6% return adjusted for inflation is achievable.

but the average person isn't waking up on Day 1 of a 40 year career making $75k.

STEM majors do, that is what I pay to recruit them.  That is what I made my first job out of college when adjusted for inflation. Even if you don't, most households would if both people making ~$30K saved prior to marriage and salary growth, thus making it even worse that more households don't achieve this milestone.


Finally, I did it in ~20 years with a ~20% savings rate (3% was always from my company).
    Year 1:  0% (locked out of plan)
    Year 2:  18%
    Year 3-7:  16%
    Years 7-now:  25% then a linear fall to 12% (yeah high income but those hard dollar limits suck)

I'm not very grounded as I'm astounded more people aren't wealthy as it really has been easy.      
    

I bet you're fun at parties. 

[MN-Investor]

I realize that a recession will come at some point. That's just the way things work. But the stock market has also been going gangbusters for the past 11 years which means that any decrease will be from a higher starting point. Basically, I look at my portfolio and ask "What would a $1M portfolio of 60% bonds and 40% stocks look like if bonds drop 15% and stocks drop 35%?

Before - $600,000 bonds, $400,000 stocks = $1,000,000 total

After - $510,000 bonds, $260,000 stocks = $770,000 total

Especially if I only had that $1M because my stocks have grown so wildly for 11 years. I'll stay the course.

(Note - My sweetie and I decided on this asset allocation beginning before he retired. Previous to his retirement in 2016 we were probably about 90% stocks.)

[Deleted]

Feb 17, 2020 22:54:25 GMT -5 minnesotapaintlady said:

Feb 17, 2020 22:08:30 GMT -5 @logicnow said:

My point is, it's been nearly 30 years and it has not been easy at all.  I'm still only halfway to being able to draw 40K/year in retirement!   I drive a POS van and never go out to eat.  I don't remember when the last time I bought myself new clothes. I'm just really lucky that I've been healthy and the kids have been healthy and I have a good support system, things probably would have been way different otherwise. 

Yes, with your income level I'm sure it has felt hard, you have done a great job!  At only a $500K invested and $20K/yr withdraw, you will get to add your SS which I estimate to be ~$18,000/yr = $48K/yr.  So you already could start lowering your savings rate and equalizing your standard of living as right now you are living on $18,500 (50K minus 7% in taxes (SS/Medicare) and 56% savings).  So possibly you are over saving?  Do you really think you will start spending double in retirement?    

[Deleted]

Feb 18, 2020 18:49:25 GMT -5 @logicnow said:

Feb 17, 2020 22:54:25 GMT -5 minnesotapaintlady said:

My point is, it's been nearly 30 years and it has not been easy at all.  I'm still only halfway to being able to draw 40K/year in retirement!   I drive a POS van and never go out to eat.  I don't remember when the last time I bought myself new clothes. I'm just really lucky that I've been healthy and the kids have been healthy and I have a good support system, things probably would have been way different otherwise. 

Yes, with your income level I'm sure it has felt hard, you have done a great job!  At only a $500K invested and $20K/yr withdraw, you will get to add your SS which I estimate to be ~$18,000/yr = $48K/yr.  So you already could start lowering your savings rate and equalizing your standard of living as right now you are living on $18,500 (50K minus 7% in taxes (SS/Medicare) and 56% savings).  So possibly you are over saving?  Do you really think you will start spending double in retirement?    

I get a lot of child support and refundable tax credits that aren't included in that gross amount...although a lot of the child support ends this July.   The plan is to keep hitting it heavy for the next 2, maybe 3 years then scale way back. 

[paynointerest]

Congrats Rukh!  This is a great accomplishment.

[Bob Ross]

Feb 18, 2020 8:59:52 GMT -5 minnesotapaintlady said:

Of course, it could just as likely drop 20% tomorrow and we go into a recession for the next 2-3 years, so that in 5-7 I've HOPEFULLY regained the losses.  

Look at the big predictive brain on you!  And only days before it all went to hell. 

Please PM me the upcoming winning Powerball numbers when you get a chance.

[plugginaway22]

I am for sure not checking balances!

[Rukh O'Rorke]

House value down too!

Job being outsourced!

I’ve hit the trifecta!!

[thyme4change]

Feb 27, 2020 19:55:03 GMT -5 Rukh O'Rorke said:

House value down too!

Job being outsourced!

I’ve hit the trifecta!!

😰

Yikes.

[Miss Tequila]

Feb 27, 2020 19:55:03 GMT -5 Rukh O'Rorke said:

House value down too!

Job being outsourced!

I’ve hit the trifecta!!

Oh no!!

[Gardening Grandma]

Feb 27, 2020 19:55:03 GMT -5 Rukh O'Rorke said:

House value down too!

Job being outsourced!

I’ve hit the trifecta!!

I’m sorry Rukh.  But this too will pass

[Rukh O'Rorke]

Thanks for the commiseration all!


Quite a come down in just a couple weeks! Very sobering. I would be quite sang froid about this whole decline if it wasn't for the job situation. 

Trying to keep optimistic and keep moving forward.

[Rukh O'Rorke]

And I'm back!


Net worth on 6/15/2020 : $1,093,846

[Gardening Grandma]

Jun 15, 2020 16:49:55 GMT -5 Rukh O'Rorke said:

And I'm back!


Net worth on 6/15/2020 : $1,093,846

Dang it, Rukh! You know what happened last time you posted over a Mil  Quick! Take it back!!!!!

[Rukh O'Rorke]

Jun 15, 2020 17:25:20 GMT -5 Gardening Grandma said:

Jun 15, 2020 16:49:55 GMT -5 Rukh O'Rorke said:

And I'm back!


Net worth on 6/15/2020 : $1,093,846

Dang it, Rukh! You know what happened last time you posted over a Mil  Quick! Take it back!!!!!

LOL - I totally did have that thought but I'm going to move forward assuming that the universe is not out to get me...


We shall see!!

[Ava]

Jun 15, 2020 16:49:55 GMT -5 Rukh O'Rorke said:

And I'm back!


Net worth on 6/15/2020 : $1,093,846

Congrats!!!!
That's great.

[Bob Ross]

Jun 15, 2020 16:49:55 GMT -5 Rukh O'Rorke said:

And I'm back!


Net worth on 6/15/2020 : $1,093,846

Didn't you learn from the first time around?

SELL SELL SELL!! 

[Rukh O'Rorke]

Jun 24, 2020 9:48:50 GMT -5 Bob Ross said:

Jun 15, 2020 16:49:55 GMT -5 Rukh O'Rorke said:

And I'm back!


Net worth on 6/15/2020 : $1,093,846

Didn't you learn from the first time around?

SELL SELL SELL!! 

haha - I did sell a few this week. One I thought - oooo that's high for it, sell and buy back later.

I resisted. down almost 4% today. maybe next time.

[Rukh O'Rorke]

Feb 13, 2020 11:30:55 GMT -5 Rukh O'Rorke said:

Rukh O'Rorke net worth as of today!


$1,003,215.60

This is just incredible, less than 2 year later I am at liquid savings and investments of $2,035,768.97 at market close today - with yesterdays prices still on any ETFs, mutuals, etc.


I am up 30k from when I posted the goodies to the WR net worther thread, but I wanted to share with all yall too! I am over the moon!!

[CCL]

Yay! Good for you!

[Rukh O'Rorke]

LOL, I just reviewed the thread, I forgot how......weird.....it had gotten!

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!

ok - so step one of the plan is complete!

Unfortunately, It's difficult to pay off my debts because all my money is in protected accounts - roth, ira, hsa. So taking 350k? (have no clue what my mortgage balance is, or even what the number of the refiance i did in jan/feb was. Maybe 369k, idk!) to pay off mortgage would trigger taxes and penalties as I am under 59.5. With my mortgage so large, and adding 100k in student loans, paying these down from my salary would take a very long time. too long.

I need to start tracking my debts again and then when my LAs-debts=2.0M, I quit. Right?

Time to start my pre-retirement punch list. Medical workups, household stuff, new car, new roof, that kind of thing. Take a lot of sick days, you know.

[Rukh O'Rorke]

I'm gonna do a separate thread on that actually.....