Anonymous
05/14/2025 07:49
Subject: Only 100k in 401k at 50
Depending on what you meant by living paycheck to paycheck, please make sure you have a good emergency fund or at least temporarily use your Roth IRA as an emergency fund before putting all of your new earnings into retirement accounts.
https://www.bogleheads.org/wiki/Roth_IRA_as_an_emergency_fund
https://www.bogleheads.org/wiki/Roth_IRA_as_an_emergency_fund
Anonymous
05/14/2025 07:46
Subject: Only 100k in 401k at 50
Anonymous wrote:Anonymous wrote:Anonymous wrote:I don't have data to back up my claim but if I had to guess I'll say the median 401k balance for a 50 years is around $100k and the average probably around $500k. There is big income disparity between college and non cell grads.
Fidelity found that participants between 50 and 54 had account balances of $199,900 on average, while participants between 55 and 59 had $244,900. This account data is based on 26,700 plans and 24.5 million plan participants as of December 31, 2024.
https://www.investopedia.com/average-401k-balance-50-year-old-8773972#:~:text=Fidelity%20found%20that%20participants%20between,4
Also 401ks underperform the S&P by 25-50%.
OP, please don't be scared by what this poster is trying to imply about 401(k) with this underperformance comment.
Yes, on average 401(k)s do underperform the S&P 500, but that's not alarming. Some is due to asset allocation. If you want to hold a portion in bonds, you can expect lower returns but also generally with the trade off of lower volatility. Some is due to trading behavior vs. buy and hold (indexers who don't mess with their portfolio generally do better over time than even the index itself).
Some is due to being invested in active funds with high fees. Performance of low-fee index funds will compare well to the S&P 500 regardless of whether you hold them inside or outside of your 401(k).
Finally, many here equate 401(k)s with target date funds that are often the employer's default or else blindly chosen by many investors. These often haven't performed as well as S&P 500 in recent years due to often holding a substantial portion of international (as well as more active management with higher fees and a growing bond allocation over time). While true about many target date funds, that's NOT an argument against 401(k)'s, it's an argument for paying attention to your investment choices, associated fees, and choosing an asset allocation you're comfortable with whether that's a target date fund or not.
If you are scared, I'd suggest listening to the Money Guy Show on YouTube vs. as a podcast at first because they show charts on their net worth by age and similar episodes. They often show the power of the first $100k saved and demonstrate how much future contributions can turn into at different ages.
Also please don't my this comment as against low-fee target date funds. That's a reasonable strategy and you never know when international will outperform domestic, which is why many of them hold international.
Target date funds are aiming for a reasonable balanced portfolio that gets less risky over time. That's a prospective concept. Actually that's another thing that tends to bother me about some posters here. You can't predict the future and guarantee anything with investing.
Anonymous
05/14/2025 07:39
Subject: Only 100k in 401k at 50
Anonymous wrote:Anonymous wrote:I don't have data to back up my claim but if I had to guess I'll say the median 401k balance for a 50 years is around $100k and the average probably around $500k. There is big income disparity between college and non cell grads.
Fidelity found that participants between 50 and 54 had account balances of $199,900 on average, while participants between 55 and 59 had $244,900. This account data is based on 26,700 plans and 24.5 million plan participants as of December 31, 2024.
https://www.investopedia.com/average-401k-balance-50-year-old-8773972#:~:text=Fidelity%20found%20that%20participants%20between,4
Also 401ks underperform the S&P by 25-50%.
OP, please don't be scared by what this poster is trying to imply about 401(k) with this underperformance comment.
Yes, on average 401(k)s do underperform the S&P 500, but that's not alarming. Some is due to asset allocation. If you want to hold a portion in bonds, you can expect lower returns but also generally with the trade off of lower volatility. Some is due to trading behavior vs. buy and hold (indexers who don't mess with their portfolio generally do better over time than even the index itself).
Some is due to being invested in active funds with high fees. Performance of low-fee index funds will compare well to the S&P 500 regardless of whether you hold them inside or outside of your 401(k).
Finally, many here equate 401(k)s with target date funds that are often the employer's default or else blindly chosen by many investors. These often haven't performed as well as S&P 500 in recent years due to often holding a substantial portion of international (as well as more active management with higher fees and a growing bond allocation over time). While true about many target date funds, that's NOT an argument against 401(k)'s, it's an argument for paying attention to your investment choices, associated fees, and choosing an asset allocation you're comfortable with whether that's a target date fund or not.
If you are scared, I'd suggest listening to the Money Guy Show on YouTube vs. as a podcast at first because they show charts on their net worth by age and similar episodes. They often show the power of the first $100k saved and demonstrate how much future contributions can turn into at different ages.
Anonymous
05/14/2025 05:25
Subject: Only 100k in 401k at 50
Op, you are doing great! Starting plowing money into your retirement accounts. The first $100k is really hard, but you did it! Things will accelerate now. Start plowing money into your retirement accounts up to the max. If you have any room in the budget consider putting $400 a month into a 529 for the oldest kid. Aim to cover one third of state college costs from savings. Anything extra will get rolled over to the next kid if they are also college bound.
Anonymous
05/14/2025 01:18
Subject: Only 100k in 401k at 50
Anonymous wrote:I don't have data to back up my claim but if I had to guess I'll say the median 401k balance for a 50 years is around $100k and the average probably around $500k. There is big income disparity between college and non cell grads.
Fidelity found that participants between 50 and 54 had account balances of $199,900 on average, while participants between 55 and 59 had $244,900. This account data is based on 26,700 plans and 24.5 million plan participants as of December 31, 2024.
https://www.investopedia.com/average-401k-balance-50-year-old-8773972#:~:text=Fidelity%20found%20that%20participants%20between,4
Also 401ks underperform the S&P by 25-50%.
Anonymous
05/13/2025 20:56
Subject: Only 100k in 401k at 50
Your best earning years are to come so just keep saving as much as possible. Your kids might need to start off in CC or live at home to go to an in-state school. Prioritize your savings over their college savings.
Anonymous
05/13/2025 20:55
Subject: Only 100k in 401k at 50
I am similar to you op but younger. 90k at 40. (And has gone down in the last terrible month)
People may be very unkind to you on here.
Making you fear, as though you’re not already scared.
This is a bad forum to admit that you aren’t as prepared as you want to be. It’s sad but true.
People may be very unkind to you on here.
Making you fear, as though you’re not already scared.
This is a bad forum to admit that you aren’t as prepared as you want to be. It’s sad but true.
Anonymous
05/13/2025 20:51
Subject: Only 100k in 401k at 50
I had 70K in my account 12 years ago and 600K now. It grows faster the more you have. Put as much as you can away. At 50 you can put in catch up money.
Anonymous
05/13/2025 20:48
Subject: Only 100k in 401k at 50
First, you should know what your 401k is invested in. It's possible that it is all your money, barely any growth, minus fees.
Max out your Roth as long as you can buying Voo/VTI for now. If that $100k were in few growth stocks in your Roth or in an investment account instead of what 401k has for you, it would turn into a million easily by the time you retire. No need to add more money.
Learn to invest and make sure your kids start at 18 or the minute they get a job. Help them with their credit if you have a good one.
Don't put any more money into 529. Roth IRA, 401k up to the match (stock fund), and open an investment account so you can learn, stay healthy, watch your grandkids for free. It's more help that 529.
Max out your Roth as long as you can buying Voo/VTI for now. If that $100k were in few growth stocks in your Roth or in an investment account instead of what 401k has for you, it would turn into a million easily by the time you retire. No need to add more money.
Learn to invest and make sure your kids start at 18 or the minute they get a job. Help them with their credit if you have a good one.
Don't put any more money into 529. Roth IRA, 401k up to the match (stock fund), and open an investment account so you can learn, stay healthy, watch your grandkids for free. It's more help that 529.
Anonymous
05/13/2025 20:42
Subject: Only 100k in 401k at 50
OP, just by not being in debt, you're ahead by a lot.
Teach your daughter to focus on what is best for her and not just the brand name. In the meantime, learn from publicly available info how your kid can get scholarships.
For example, being a school safety patrol in 4th & 5th grade qualifies you to compete for a scholarship. I think it might be an AAA program.
Being legitimately involved in volunteering helps support scholarship applications from local groups.
You can even look up the available scholarships at your flagship and think about how she might become eligible.
Some on here say the Ivies are cheaper than flagships if you have real financial need. That can be true.
I think once your daughter gets to late middle school, then you can work out a 4 year plan with her to get where she can go.
Saving for your retirement is important. It's a put your own oxygen mask on first situation. It's hard for children to have financially dependent parents. Harder than earning their own way. They might also need to boomerang into your house for a while, so you need to be able to cover that.
Just being able to do things like keeping a college kid on your health plan or phone plan is a help to them.
You should probably plan to retire later than 65 unless your family dies young. I think your full retirement age for Social Security is 67. We are supposed to live longer and work longer than Boomers.
Good luck and don't panic! Scrimp so you can invest long term and with maybe a year's worth of living expenses you can tap in an emergency without selling stock.
Teach your daughter to focus on what is best for her and not just the brand name. In the meantime, learn from publicly available info how your kid can get scholarships.
For example, being a school safety patrol in 4th & 5th grade qualifies you to compete for a scholarship. I think it might be an AAA program.
Being legitimately involved in volunteering helps support scholarship applications from local groups.
You can even look up the available scholarships at your flagship and think about how she might become eligible.
Some on here say the Ivies are cheaper than flagships if you have real financial need. That can be true.
I think once your daughter gets to late middle school, then you can work out a 4 year plan with her to get where she can go.
Saving for your retirement is important. It's a put your own oxygen mask on first situation. It's hard for children to have financially dependent parents. Harder than earning their own way. They might also need to boomerang into your house for a while, so you need to be able to cover that.
Just being able to do things like keeping a college kid on your health plan or phone plan is a help to them.
You should probably plan to retire later than 65 unless your family dies young. I think your full retirement age for Social Security is 67. We are supposed to live longer and work longer than Boomers.
Good luck and don't panic! Scrimp so you can invest long term and with maybe a year's worth of living expenses you can tap in an emergency without selling stock.
Anonymous
05/13/2025 20:37
Subject: Only 100k in 401k at 50
I think you’re doing great to have such a wealth in your daughters! Don’t worry and just save as you can now!
Anonymous
05/13/2025 20:31
Subject: Only 100k in 401k at 50
I don't have data to back up my claim but if I had to guess I'll say the median 401k balance for a 50 years is around $100k and the average probably around $500k. There is big income disparity between college and non cell grads.
Anonymous
05/13/2025 20:26
Subject: Only 100k in 401k at 50
Anonymous wrote:You are not screwed, OP. Congratulations on your new job!
OP here. Thank you appreciate it.
Anonymous
05/13/2025 20:20
Subject: Only 100k in 401k at 50
You are not screwed, OP. Congratulations on your new job!
Anonymous
05/13/2025 20:16
Subject: Only 100k in 401k at 50
I only have 100k in 401k at 50. Please tell me I am not screwed. I have been working paycheck to paycheck pretty much since I graduated HS. I didn't go to college.
However I started a new job this week and my best job so far and highest every salary $150k. I plan to save as much as possible and max out 401k. I also opened a Roth IRA and plan to maximize it as well. I am not married but I have 2 kids. I won't be able to help them for college. It's a shame because they are both very smart. My daughter for example is in 6th grade and has a 99% average. I know it's only 6th grade but she already told me she is going to Harvard. I do have a 529 for both of them $2k for each. It's nothing.
I haven't managed my life well up to this point. But I do want to save every penny for the next 15 years. I don't plan to ever retire, but for planning purposes I am setting 65 as my retirement age.
However I started a new job this week and my best job so far and highest every salary $150k. I plan to save as much as possible and max out 401k. I also opened a Roth IRA and plan to maximize it as well. I am not married but I have 2 kids. I won't be able to help them for college. It's a shame because they are both very smart. My daughter for example is in 6th grade and has a 99% average. I know it's only 6th grade but she already told me she is going to Harvard. I do have a 529 for both of them $2k for each. It's nothing.
I haven't managed my life well up to this point. But I do want to save every penny for the next 15 years. I don't plan to ever retire, but for planning purposes I am setting 65 as my retirement age.