Anonymous
12/12/2023 15:32
Subject: If you have a net worth of 1.4 million at 44
Anonymous wrote:Anonymous wrote:We make $300K/year now. Right now we have $1.2m saved not counting our house (or the kids' 529s) and my husband hopes to have $2m when we retire. He says that would give us $100,000 a year in interest to live on, plus his pension. I don't know what a good target amount really is - but our house will be paid off in 3 years (I'm 42). Our house is worth appx. $900K rn.
Anyway - I am not using a financial advisor [yet]. I am not opposed to it but I am trying to read what I can for free first. I recently read I will teach you to be rich by Ramit Sethi.
Why would $1.2M only turn into $2M by retirement age if you are 42 now? Are you playing it too safe and have most of your money in bonds?
The S&P 500 has an average return of 10% since 1957. Even if you contributed nothing for the next 20 years and got 6% a year you would have $3.8M when you’re 62 if you put all your money in an index fund.
OP will have plenty of money in retirement as well at the same age as long as they’re not overly conservative and put too much money in cash and bonds.
I think 4-6% real returns are realistic. I also only calculate my own retirement account numbers for planning purposes, as part of planning is knowing you'd be okay even if you ended up divorced for circumstances beyond your control. I'm above $2m and early 40s. I don't plan to use a financial advisor. I've read all the mainstream personal finance books and regularly read Bogleheads.
Anonymous
12/12/2023 15:26
Subject: If you have a net worth of 1.4 million at 44
Anonymous wrote:We make $300K/year now. Right now we have $1.2m saved not counting our house (or the kids' 529s) and my husband hopes to have $2m when we retire. He says that would give us $100,000 a year in interest to live on, plus his pension. I don't know what a good target amount really is - but our house will be paid off in 3 years (I'm 42). Our house is worth appx. $900K rn.
Anyway - I am not using a financial advisor [yet]. I am not opposed to it but I am trying to read what I can for free first. I recently read I will teach you to be rich by Ramit Sethi.
Why would $1.2M only turn into $2M by retirement age if you are 42 now? Are you playing it too safe and have most of your money in bonds?
The S&P 500 has an average return of 10% since 1957. Even if you contributed nothing for the next 20 years and got 6% a year you would have $3.8M when you’re 62 if you put all your money in an index fund.
OP will have plenty of money in retirement as well at the same age as long as they’re not overly conservative and put too much money in cash and bonds.
Anonymous
12/12/2023 14:48
Subject: If you have a net worth of 1.4 million at 44
I once consulted with a fee-only (no commissions) financial planner.
They helped me think of things I had not thought of. For example, I got life insurance locked in early at a low price, which covers my family in case I kick off. I refinanced my mortgage. They hooked me up with an estate planner so drew up a will and some trusts.
I know the basics about investing but am not a mathematically oriented person and it helped me feel confident that we had the essentials checked off.
They helped me think of things I had not thought of. For example, I got life insurance locked in early at a low price, which covers my family in case I kick off. I refinanced my mortgage. They hooked me up with an estate planner so drew up a will and some trusts.
I know the basics about investing but am not a mathematically oriented person and it helped me feel confident that we had the essentials checked off.