You don’t just put $14k into a 401k, you keep contributing to it. Getting more and more money to compound upon itself.
If you put $4k into it every year (remember, this is pre-tax money and often has an employer match), and it grows 8% per year on average (S&P 500 actually does more like 10%, but we will be more conservative and say 8%), we will also be conservative and assume you won’t increase contributions, even as you earn more later in life, then you have $1,546,022 after 45 years of working.
Most of us that are younger than the Boomers or maybe Gen X don’t want to count on Social Security because we’ve been hearing our whole lives that Social Security is on the chopping block because the government is in so much debt. And at this point we kinda just expect that ladder to be pulled up behind the Boomers before we get anything, because that’s already happened in so many other areas like home ownership.
I also think people need to remember that Social Security is their own money that they paid in over their lives, and they are owed it back.
And also that even though the US government has a large amount of debt, we’ve also spent the last 50 years giving tax cuts to the rich, we’d probably be just fine if we went back to a 90% marginal tax rate on the top earners like we had in the “good old days” of the 1950s.
Most of us that are younger than the Boomers or maybe Gen X don’t want to count on Social Security because we’ve been hearing our whole lives that Social Security is on the chopping block because the government is in so much debt.
Thinking about it, the chance that Social Security money will be stolen and transferred to the 1% is quite high. Not because of the debt but simply to make the rich even richer. They will probably just say that the current system is not sustainable and move all the money into pension funds controlled by private banks which will then gamble with it pocketing the profits and socializing the loses. But 401k is the same so putting money there is not really a solution. The solution is to run away but obviously not everyone is able to.
The money has already been yanked from SS and other programs. It’s included as part of the National Debt figure. They have taken the excess funds for decades and spent it. Having private banks hold and invest these funds instead is highly unlikely.
The government also relies on investment funds to buy treasury bills. Most 401K’s at are set up to give the owner very little control over how they invest their money. All of the offered selections usually include treasury bills. So the government is borrowing money from 401K’s and promising to pay it back as well.
That’s all fine unless something happens to erode the trust and willingness of people around the world to lend money to the U.S. government.
Correct, you get both your own savings and Social Security during retirement. The person replying is being a doomer, rather than preparing for his future.
You don’t just put $14k into a 401k, you keep contributing to it. Getting more and more money to compound upon itself.
If you put $4k into it every year (remember, this is pre-tax money and often has an employer match), and it grows 8% per year on average (S&P 500 actually does more like 10%, but we will be more conservative and say 8%), we will also be conservative and assume you won’t increase contributions, even as you earn more later in life, then you have $1,546,022 after 45 years of working.
Yes, this is something you can retire on.
Gotta include inflation in there.
$1,546,022 in 45 years with the same inflation we’ve had for the past 45 years would only be worth $529,400 in todays money.
If you only plan on living for 10 years or less after retiring, then, Maybe.
You only get the 401k when you retire in US? This is not in addition to normal Social Security?
Most of us that are younger than the Boomers or maybe Gen X don’t want to count on Social Security because we’ve been hearing our whole lives that Social Security is on the chopping block because the government is in so much debt. And at this point we kinda just expect that ladder to be pulled up behind the Boomers before we get anything, because that’s already happened in so many other areas like home ownership.
I also think people need to remember that Social Security is their own money that they paid in over their lives, and they are owed it back.
And also that even though the US government has a large amount of debt, we’ve also spent the last 50 years giving tax cuts to the rich, we’d probably be just fine if we went back to a 90% marginal tax rate on the top earners like we had in the “good old days” of the 1950s.
Thinking about it, the chance that Social Security money will be stolen and transferred to the 1% is quite high. Not because of the debt but simply to make the rich even richer. They will probably just say that the current system is not sustainable and move all the money into pension funds controlled by private banks which will then gamble with it pocketing the profits and socializing the loses. But 401k is the same so putting money there is not really a solution. The solution is to run away but obviously not everyone is able to.
The money has already been yanked from SS and other programs. It’s included as part of the National Debt figure. They have taken the excess funds for decades and spent it. Having private banks hold and invest these funds instead is highly unlikely.
The government also relies on investment funds to buy treasury bills. Most 401K’s at are set up to give the owner very little control over how they invest their money. All of the offered selections usually include treasury bills. So the government is borrowing money from 401K’s and promising to pay it back as well.
That’s all fine unless something happens to erode the trust and willingness of people around the world to lend money to the U.S. government.
Like electing a crazy person for president?
Correct, you get both your own savings and Social Security during retirement. The person replying is being a doomer, rather than preparing for his future.