If you’re 35 and you can put away the maximum salary deferral of $15,500 a year and you never change it (increase it), and IF you can earn an average 8% rate of return every year, by age 65 you’ll have approximately $1,827,927.
And that doesn’t count your employer’s match (if there is one).
I'd take that with a huge grain of salt. There are plenty of guys who make their living writing about sports, who can't play for beans.
I have an excellent retirement plan.
It's my grandparents' retirement plan.
I plan to work as hard as I can, and earn as much as I can, until I'm dead.
Seriously.
I would rather help my kids through college and drop dead with a big fat life insurance policy so they can live a better life, then fret away about a future that might never come. We're living simply - but we're living!
My parents were squirrels. Saved like crazy, did without, lived modestly, never treated themselves to anything. Now they have more money than they will ever need. You would think they could live large, enjoy life? Nope. Mom's knees are crumbling and she can barely walk. Dad has terminal cancer. They are lucky they can make it to the grocery store, let alone the trips they always wanted to take.
I'm not saying my approach is the right approach for everyone. I just have different expectations on what the future will bring.
For the folks that want to retire, though, this article is correct. Save now, as much as you can. Treat your savings like a bill that MUST be paid every month, and you'll be surprised where you can cut your budget.
God bless the folks that can retire; I wish them all the best!
I disagree with this method. Do not take hardship loans from your 401(k) unless it is a true emergency. If credit cards are starting to pinch, negotiate a fixed-rate installment (debt consolidation) loan with your local credit union and then close the credit cards. Alternatively, use lower rate balance transfer offers (look for offers of a fixed rate for the life of the balance), close the old credit cards, and make your payments on time every month.
Taking loans from the 401(k) is like playing Russian roulette with the Federal government. You get to pay interest back to yourself, but it's with after-tax money, and that interest gets double taxed on the way out during retirement. And, on top of that, if you leave your job for whatever reason, the entire 401(k) loan can be immediately repayable (or treated as an early distribution and thus subject to both income tax and penalties).