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Is this right?
creepycoug
Member Posts: 22,741
Less than 340,000? That doesn't seem like a lot. Then again, I have no sense of the real wealth distribution in the U.S.
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The chart you included is slightly misleading, as it only captures accounts managed by Fidelity. It doesn’t capture 401k, IRA and other defined contribution (e.g. 403b) accounts managed by Vanguard, Schwab, TD Ameritrade, the Thrift Savings Plan, etc.
The max contribution annually to an IRA is 6K (7K after you're 50). Contributing a full 6K, with 10% return takes around 30 years to hit a million. At 15% return it is still ~23 years.
Doing that for a 401K using 19K as the assumed contribution takes 16 years at 15% return and 20 at 10% return. Sure you can go higher than the 19K, with employer match (Love my 6.5% extra there) but it obviously takes a long time to hit 1m with optimistic assumptions on the contributions during the early years.
I'm also curious if these are numbers for a single account or across multiple accounts. IRAs having so many are surprising given the lower contribution allowances, but perhaps with 401K rollovers to IRAs boost those numbers.
So I assume VG has at least Fidelity-like numbers and then there are smaller players.
Even extrapolating from the Fidelity numbers using rough guesstimates, seems there aren’t a lot of Americans with 7 digits in their 401k.
Millennials are actually doing a pretty good job stowing away cash (probably from habits learned while living at home with their parents 2008-2011ish). Gen x though...woof. Hard to envision how many of them will ever be able to retire
When I say woof about gen x, I’m talking how 35% of 50 year olds have <50k in total assets etc.
When I see that, I think a retirement crisis is on the horizon that will require govt intervention. Or we will just become Italy and everyone’s grandparents will live with them Charlie and the chocolate factory style starting in 20 years
Goal is to live off investment returns and leave the corpus to my kids. Will likely rent the Seattle place out when I pull up stakes. Want to keep my foothold in Seattle because I’m convinced long-term it’s gong to be a hard place to move back to if you left the market.
I think renting is def the correct route. Being a landlord can be a pain but I don’t see myself ever selling my first house (rent is mortgage + $1500/mo currently). I just wish I’d listened to my dad more growing up. He always tried to teach me woodworking/metal working (his hobby) and I would always tell him to fuck off. Now I’m looking into apprenticeships at local shops to pick up the skills in my spare time.
I met a guy in Lauralhurst(?) about three years ago. Some property tax issue was in the news, I can’t remember which one, he casually mentions the thousands he’s about to get jacked and laughed it off. He was asked if he had a limit where it’s “too much” Nope. Not at all. The way he looked at it, whatever was happening in Seattle appreciation wise far outweighed the amount he was getting hit for and although it would eventually cause him a cash flow issue, he was confident the market would always lend against his rising equity to fund their need for increasing property tax.
Don’t get me started on how fucking selfish and/or Spineless (and yes, sometimes even Spiteful) a Reverse Mortgage is with how it’s gumming up the overall market
Also, anecdotal but I hear a lot more stories about real estate family members/friends have sold that they shouldn’t have then Vice versa. My great grandma owned a big house basically caddie corner from Hayward field and sold it in the late 80s for around 35k. Would have been a real nice asset to have in the family. Lesson learned—don’t be my great grandma
Imagine Great Grandma back in 1986 running into a Suave @creepycoug’s future Mentor down at Church on Wednesday night and while serving meals together to the under privileged said, “ Yo, GG (he liked to call her that because it made her giggle and that’s just the way he rolled) You looked stressed, what-up?
and she said,
“I just got this check from the house and I just don’t know what to do.”
Suave @creepycoug’s future mentor being the high character brilliant man you would expect him to be said, “ What is it you want to do?”
GG>>> Well, as you know, I’m moving to Great Retirement Village in Anytown. With my income I have more than enough to cover it, still save money and fulfill my pledge here. I want to hold back $Ten thousand dollars for just in case money and put twenty five thousand dollars into one of those Trusts you set up for Margaret last month but I don’t want loudmouth Margaret or anyone else to know about it.
Now Suave @ccfm, being the business and estate planning specialist he is, has seen this seen this scenario a thousand times and he wanted to help her. So, he kept asking questions