Maxed 401K, IRA, HSA [All Roth] last week! I’m 36 and my wife is 29. We both just recently crossed the 6 figure mark. I’ll get yelled at by half the audience but we just started investing seriously only 3 years ago. We put all of our energy into paying the mortgage off early [10 years] and can really crank up the savings rate comfortably. The freedom was definitely worth the opportunity cost! Good luck everyone!
"Just" started three years ago, when you were 33 and your wife 26? Yeah, that's not Erin early, but still much earlier than many. Plus the two of you already have sizable shovels. With the mortgage paid off too (!), the hard part will be avoiding serious lifestyle creep! :) Nice job!
That’s great and you do you, but it’s important to keep the long term in mind. Unless your mortgage was 8%, it definitely doesn’t make sense to pay that off before maxing out retirement accounts! Think about all the money you miss out on in interest! It’s easy to let anxiety about payments get the better of you, but just take a deep breath! Having a mortgage isn’t a bad thing at all unless it’s high interest
My wife and I just started really saving and investing this last year, kids are all on their own now. I do have a pension from the Army for the rest of my life. I’m 47 and she’s 41. It’s never too early to start. Both our 401k’s are maxed (and Roth 401ks), and we chunk $6k a month on the side into savings & investments because we live well beneath our means and haven’t allowed lifestyle creep. If I’d have started when I was your age? I’d be retiring at 55, not 60-62. Point being? I’m not going to yell at you, I’m going to congratulate you. You’re on the path to complete financial freedom way before I got on it! I’m trying to instill that in the kids… start now, I don’t care if it’s $20 a month.
I only just reached the IRS 401k limit of $22,500 this year. In prior years I was contributing about 21% which was about $19k a year. This is my first year making above $100k
Two income family with 2 children. One of us hit the max 401 at about 46 with about 120K salary. That company also has their own stock options which is close to 10k a year. The other contributes about 6% to 401K. We also max out the HSA, since 2020. By age 50 we should hit the 1 million mark, without including the house.
I first maxed out my 401k in 2021 when I was 29. I made $122k that year. It was tough, but it’s a great way to keep yourself accountable to living beneath your means.
I started maxing out my 401k contributions in 2016 and did so every year until I was laid off in early 2020. That's when I decided to take a good look at my finances and I saw that the majority of my money was locked away in retirement accounts. When I found my next job in late 2020, I decided to focus on putting money into my personal brokerage account to bridge the monetary gap to age 59 1/2. If I wanted to retire early, I needed access to the money without penalty. The only thing I maxed out was the 401k match. Once I had enough "bridge" money, I was going to go back to maxing out my 401k contributions.
If you separate from your job you can withdraw at age 55, you have to be 55 or older when you separate from that job, if you leave at 54 you need to wait till 59 1/2
I first maxed out my 401k at age 31 when my salary first bumped into 6 figures. This was also with having two kids in daycare. I am now 32 with 3 kids in daycare and I must admit it is getting pretty hard even with a 6-figure salary. I know it sounds silly but I am basically living paycheck to paycheck in order to do this. We are saving our income up front and then everything we take home pretty much gets spent after that. While It may be a little hard now, I know this will pay off for my family in the long run. Keep going people, you can do this!
You're not living paycheck to paycheck if you're saving money. Paycheck to paycheck means you only have exactly enough to cover your expenses and nothing left over.
@@justthebrttrkhence why I said it’s silly to say. It’s like a forced scarcity tactic if you are treating savings like an expense that is all of your margin.
@@klopad57 You're doing the right thing, and someday down the line, when you feel like giving yourself a break from the scarcity, you'll be able to! Comfortably! Kudos.
I am maxing out my Roth 401k. Yes I am not currently getting any tax savings. But my earnings and withdrawals in retirement will be completely tax free. What I love about the Roth 401(k) is it can help you save on taxes in retirement. Not only are withdrawals tax-free at 59 1/2 , it won't impact the taxation of your Social Security benefit and Medicare premiums.This is an important aspect of a Roth account that most people are not aware of. yes right now I prefer the Roth 401k! Because my effective tax rate is 19% ( it sometimes jumps to 22% ). That is for state and federal combined.
After my $320 deduction for my tax deferred account, my pension, taxes, medical insurance. I only had $2,200 to live on. I couldn’t have possibly maxed anything out. I did open an ira also. For over a decade I worked a 2nd job, but I still wouldn’t have been able to save that much. I am single, i learned to live below my means. I am 66. Between my pension, social security which I am planning on pulling at 70, my tax deferred investments, individual stock I have invested in through the years, and cash I stashed for retirement, I should be just fine. People should not be discouraged that they cannot invest $22,000 a year. I never made $50,000 a year, and will be living at a way higher tax bracket then all my years of working once I start collecting social security, then I will bump up again when I have to draw rmds
I think the difference in motivation is that those of us in the melinials and younger bracket are not expecting social security to be there when we retire. Granted,i don't think it will be gone entirely. I expect there to be something, or some UBI style program that takes its place. But I don't expect it to grow with inflation, or even to get out what I pay into it. Whatever is there I'll consider to be a small bonus, but the only things I'm counting on is what goes into my Roth, HSA, and 401k accounts. There won't be pensions any more, and whatever social security exists will be very small. What I find terrifying is young people nit only counting on social security, but they think that social security is all that a person needs for retirement. It was never intended for that! If you didn't or couldn't plan for retirement it is supposed to provide for some basic needs, but it was always intended as a supplement to other retirement options, not anyone's only option. People are in for a rude awakening.
@@CaedenV right, social security was only meant to cover like 40% of income. I was encouraged to work the 2nd job to save more because of seeing how little mother, but particularly my grandfather had to live on. My grandfather had 2 pensions and social security. I already knew to be concerned about inflation, just because of my grandfather. You cannot discount the affect of inflation.
I didn't max it out all my life but did for a majority of my career. It was a priority for me. It allowed me to retire at 52. That was 6+ years ago. It forced me to live below my income level. That was the key to a successful retirement plan at such an early age. I was single for all but 5 years of my life. It can be done!!!
Crossed the 6 figure milestone at 42, but stayed around the 8% rate into 401k, totaling around 11-12% when including very consistent savings account contributions. Being debt adverse, my focus has been eliminating my mortgage (at the opportunity cost of reduced compounding). Mortgage should be paid early next year at which point I’ll be all in at 47! Maxed out a new Roth last year, and will continue with that theme as well.
I'm going to max my Roth Ira and 401k for the first time this year. 43, single, no kids and house paid off allowed me to do it. I will make about 85 or so this year but next year I will continue saving for my midlife crisis car.
Best advice I ever took was from my Father-in-Law. Back in 1980, when my wife and I first got married, he told me "as soon as you can, get started investing." Back then you had to wait a year before being eligible, and we only started at 2%. Every raise we bumped up our savings rate, up to 10% (yeah, it should have been more). Getting ready to retire this May with plenty in the IRA/403b.
So 43 years with a maximum rate of 10% and you are ready to retire. Mind me asking if your safe withdrawal rate supports more or less than your working years expenses?
@@IamR3D88 Short answer to your question: yes, more than enough, even if SS isn't part of the picture. Long version: My max annual income was my final year as a software engineer in 2012. 2013-2015 I made essentially pocket change to supplement my pension, about $10k/year and contributed zero. 2016 I found a job teaching engineering to high school students, which paid in the low-mid $40k range for the remainder of my career, which is ending this June. I contributed to the match in the state employee 403b plan during those 8 years. So, my teaching income needs to be offset by my SS income + funds from our investments. We just met with our SS agent last week, and my SS check almost offsets my teaching income exactly. Not perfectly, but close enough that our budget (which was below our take-home pay) is still covered. We're now working on figuring out how to covert our traditional 403b/IRA to Roth, primarily to prepare for survivorship (tax brackets jump painfully when transitioning from married filing jointly to single) and estate planning.
Our goal was to max out our Roth IRA's first, then I started working on hitting the max in 401k. We achieved both for the first time last year at $140k. We also max out our HSA family contribution each year. Our savings rate is near 25% across all the account types.
My husband and I started maxing out retirement accounts in our 20s. Start maxing out as soon as you can. It's tax deferred, so it helps with taxes and it allows compounding to have a greater impact.
In a one income household, it is since the age of 47 that I have been maxing out my 401k. I'm 53 now so it's been about 6 years. With my employer match I'm saving 27% into the 401k. I also contribute to a Roth IRA and that is about 7% and I've been maxing it out for the last 10 years. I save another 10% into our HSA and a brokerage account. Prior to maxing my accounts I had a savings rate of 10 to 15%, but my income was lower back then. My base income is 70 to 80k but with extra call days and shifts I have been able to almost double my income for the last decade.
Great video! I’d be able to max out now at 35 if I wasn’t paying off debt. I’m paying off in debt annually the equivalent of the max. I can’t wait until the first time I can contribute the max! It’s one of my financial goals.
No one ever says they retired with too much money but some wish they had lived more when they were younger. Save, save, save ... but don't miss out on life. When you're older you may not have the health to do everything you want to do ... and your loved ones may not be around to spend that time with.
Erin, another great video and one to create discussion/debate! My problem is.. we have a 457(b) option, but we cannot change our 401k contribution rate. So between my wife and I, we would have to contribute close to $100k to max 401’s, 457’s, IRA’s, and HSA’s! I’d love to discuss this with you in detail if you are available via email? PS- congrats on the newborn! 👌👍
I could easily max out my 401(k) each year, but I don't because I am on pace to retire early and I'll need the money about 5-10 years before 59 ½. I max my Roth IRA, contribute enough to get the match in my 401(k), and the rest goes towards my individual brokerage and other investments.
So my wife and I were in an interesting situation and it took my niece to sort of suggest how to maximize things. My employer offers both the deferred comp plan and a HCSA. On my own salary I probably couldn't have maxed these out. But it was suggested to me to do so and my wife then deposits extra money into our joint account so that we can cover the bills. I will add, I provide the health insurance. Meanwhile, she is self-employed, opened her own 401K plan and maxes out as both the employee and employer contributions. So yeah, we save a lot and reduce our taxes. It just wasn't obvious to us at first, but it works out well. Now if we could just get back to some decent market returns we'll all be happy.
Just maxed out my 401k, and roth IRA last year. That was tough, but worth it when I saw how much my account went up. This year trying the HSA. Unfortunately my 401k is all traditional so I'd like to slowly get that over in the roth direction. I'm 37 so started much later than I would have liked. I started in my 20's, but only did about 5%. I had income issues until recently when my salary doubled making this more reasonable. It's still tough though because it's about 50% of my income. I'll still be more than fine in retirement, but knowing I could have had so much more is rough to think about.
Maxed out our Roth since we were 26/29. Maxed out 401 39/42. Could have done that way earlier, but wanted to use the money for our brokerage account. Ever since we maxed out our 401k, we have been doing maga backdoor Roth with both of our employers. Granted we are not maxing out the mega though lol. Income 280k not including hubby’s RSU. We also invested 529 for our 2 boys and pay double of our mortgage. Really hoping in 8 years job is an option. Fortunately we do enjoy our careers, and both with great companies.
Family wage income $94k but in Vermont that's quite a lot as median here is about $72k. At 56 about 20% of the taxable paycheck is saved these days but we weren't that aggressive until the pandemic. About 10% pay to the 401K. Also there's a sweet employer 401K match on that so effectively 20% into the 401K! The 401K is all low cost funds. We try to max the IRAs and my HSA from the brokerage account. The other 10% saved goes to that account. 2023 will be the first year maxing the IRA's and HSA. No plans on maxing the 401K since I enjoy researching and buying individual business much more than funds. My cap gains rate is about 0% since I usually only sell long and most of my dividends are qualified. Once the proceeds are in the HSA and IRA I often re-buy my same companies.
Will max out 401K this year at 52. I was not maxing out before because kids being at home and saving for college. I have also been saving in my employee stock purchase program at 15% of salary. Between ESPP (which I roll into ROTH IRA to max out for my wife and I now that kids are out of house) and 401K, we are saving 32.3% of my salary. That is NOT counting whatever I have set to go into HSA.
I'm getting close-ish. We probably could do it, but have other priorities. We are maxing out my and my wife's Roth accts, plus our HSA which we treat as a retirement acct with preretirement benefits, and contributing just enough to get the full 401k employer match. But rather than going forward to max the 401k the rest of the way, we are investing the rest in a non retirement account with a focus on dividends. The goal here is a sort of super emergency fund that acts like a 3rd income. First goal is to have it generate an average of $1k/mo in dividends, and the end goal is $2-3k/mo. Once it hits $2k/mo then I think we would divert into maxing out the 401k (if we get that far). I realize that this isn't the most efficient from a tax perspective, but $2k/mo isn't going to bump us into the next tax bracket. Plus my wife is self employed and has rather variable and seasonal income, while I work in IT which can be a volitile job market at times (knock on wood, so far no issues though). Plus we have some health concerns to contend with and won't get better with age. So the goal is to have a sort of 3rd income where if the chips are down, and we are out of work, or can't work, (or don't want to work lol) then we would have the flexibility to not work for a while, or work less, with less worry about tapping into savings or derailing retirement plans. I would love for the numbers to tell me that if we stopped retirement savings then we could join the fire movement... But we would hit FIRE just a couple years before retirement age anyways lol. So it makes sense to max out the post tax retirement options, understanding that we will have a sizeable normal investment acct, plus a 401k generating taxable income in retirement. So we can let the Roth and HSA accts continue to compound at the start of retirement, and slowly drain the 401k and investment acct early on, and then have less tax burden towards the end when we potentially need our dollars to stretch further.
I wasn't able to max out anything until I was 29 because none of my employers offered any plan other than a credit union. And it still usually required a year of employment to qualify for it. That being said, I always saved the maximum allowed until I was in my late 50s and never regretted it. Seeing the shrinking of your paycheck hurts initially - but once you adjust your spending habits to it, it is barely noticeable. And when you leave the workforce, the scaling back of your lifestyle to accommodate your savings makes any income adjustments needed for retirement easier.
My wife and I have been contributing to our 401K's for 25 years. I've been maxing it out for the last 16 years, and she has been maxing it out for the last 13. Maxing them out started when each of us started making 6-figures in our early/mid-30's.
Lasr year, at age 49, on 120000 sallary, I maxed out my 403b and 457 accounts last year. But that was difficult. This year I decided to max out just my 457 account because I finally had the Roth option and the catch up option. This has given me more breathing space in my budget. Hopefully, I can fund my Roth IRA in the near future.
Maxed mine (401k mainly roth, plus Roth IRA) when i was 33 in 2019 making $118k. It's tough depending on lifestyle. My wife is a stay at home mom and we have 2 boys. In the last 12 months I bought a brand new house, and 2 months later bought 80 wooded acres so that will have an impact on my savings, but I forecast this year I will save $22k between all retirement accounts (mostly roth). Last year total savings (401k, IRA, Brokerage account) was $37,500.
I maxed at 28 the first year of my first serious job. I was making 76k. I also maxed out roth ira and hsa. I always try to save around 50% of my salary. I make a lot more now and I'm still at about a 50% savings rate. I'm enjoying my lifestyle inflation.
I’m doing to this right now at age 29 making 70k plus 5k for student loans. Hoping to have a similar path. Feel like my raises now will actually raise my living standards now haha.
I don’t really see myself retiring. I plan on being at least part time until I decide otherwise. I enjoy my job, which pays enough to live on and then some. I’ve been getting steady raises each year, and work a low-impact job on the side. I save a bit each month, and put what I can into retirement. I also have a moderate investment account and it does alright. I just don’t think I could not work. It’s nice sometimes to realize I’m on a progression where I wouldn’t have to, but I honestly think without some of the challenges work can bring, I’d probably just decline and be waiting to die. Honestly, I’m kind of convinced if I get to a point where I legitimately can’t work, I’m basically probably there anyway.
Increase to $23,000 in 2004 ? I just chuckled because you usually only have these in the blooper reel. Are you ever going to do one again ? And how is Steve Jr. doing ?
Oh no!! I miss the bloopers too - and maybe one day they will come back - but two things - quite simply as I have gotten used to filing, I have less bloopers, and two, that bloopers reel takes time to piece together 😂 and I’m low on time these days. Fun fact - this is the first video I filmed after baby was born (I still have a few others to release from before he was born though) he’s doing well, but needs to get better at sleeping!
This will be my first year to max out my roth TSP. I'm 44, single, no kids, and gross $85k. I also max out my roth IRA and contribute the same to a brokerage account.
I was a six figure earner but NOT in the top 10 percentile. I retired 2 years back at the age of 56 assuming zero social security income. I not only maxed out 401 K contributions but also additionally invested in a Vanguard brokerage account. So far despite facing the sequence of returns risk, I am comfortable and am not worried about my retirement.
We have been maxing out for a long time. We own a company and have SARSEPs. We end up paying quite a bit in taxes every year. I consider it a problem, but a good problem to have. We used to have an HSA, but now are on Traditional Medicare, so now use the HSA money to cover the small things Medicare does not cover.
I’m 26 and have been maxing out my TSP ever since starting my full-time career (age 22). Of course, it’s much more feasible to live below your means and super save when you’re single and don’t have any dependents. Here’s to discipline and delayed gratification! 🍻
I didn’t max out until my 40s and even then dropped off a bit for a couple of years. Been consistent max out since my late 40s including the 50+ catchup.
Mid30’s and I missed out on investing in my 20’s. I insist on maxing my accounts starting now, even though I have two kids. The way I see it, we can live frugally now or when we’re old. Better to get by on less now than to suffer in old age. I insisted on increasing my contributions as soon as I earned more to prevent lifestyle creep (a condition I call “dollar sign eyes”). It got possible around 150k per year in total income.
Been maxing out my 457 and our back door Roth IRA’s for 2 years now and just turned 30. My wife and I have two kids 3&4 years old. Some say kids make it difficult to save but they were our motivation to really get serious about saving. It also helped make it possible since we have two incomes coming in! We plan on early retirement and using the 457 and taxable brokerage account as a bridge account until my pension kicks in at 55.
Nice! Good job to you guys! I also hope to utilize my 457 to retire early! Preferably 50ish or early 50’s. Do you know how the taxes/distributions work with a 457?
@@brandon8531Thanks! Yes. The traditional 457b has no penalties for early distributions once you terminate employment. The distributions will be taxed as regular income when I withdraw them. This is what makes it so good for a bridge account for early retirement! We are also planning on around 50 years old to be able to retire. We may decide to continue to work but it would be nice to have the option of early retirement! Good luck with your financial journey!
I’m really curious to see how your life and saving change once you have kids. For example we used to save about the same amount as we do now before we had kids. Though our incomes were much lower before we had kids now we have kids and are very financially stable with good income from rentals and a good job. The reason is not that kids are expensive like people say diapers and all that was not a lot for us. We spend a lot on activities and going to do things. Like 5k a year just for trips and fun things that are totally unnecessary. Then we have bought four wheelers and a camper and the like cause it is so fun to create these memories. Yes we could save more but we are pretty much already setup for retirement at 36. We live well now and will live even better in retirement. Would love to hear what your plans are and then hopefully you keep doing RU-vid and share what actually happens. Thanks for the great videos Erin.
I first maxed out my 401k annual contribution back in 2009 at age 32 after nine years of working. Back then I didn't keep track of my 401k closely and just set it to 20% and forget it. I remember seeing my paycheck net pay different that week and ask my coworker if we were getting a salary adjustment for some reason...he checked his paycheck and said no his was the same....hahaha....never imagined I'd hit the max to be honest.
I’ve maxed out both my Roth IRA and 401k every year since I turned 47. It was easier at 47, 48, and 49 than it was when I turned 50 and I had to add the catch up contribution to max them out!
I started nearly maxing whatever my employer matched for my 401k until recently. I lowered the percent a bit to focus more of my money on paying down student loan debt (goal is 5 years to gone). Then I'll probably return to maxing my 401k contributions & work towards maxing my Roth IRA as well. I am still in my 20s, so I hope to be able to have a more solid pay to be able to add to my current investments in my 30s & 40s. 🙏🏿
"Maxing out" your 401k isn't just maxing out your employer match. In most cases, that really should be a minimum contribution rate, as the employer match is a 100% rate of return - or basically free money. "Maxing out" your 401k is generally considered hitting the federal maximum normal (ie., pre-tax + Roth) annual contribution.
Two income family with a child and two dogs. Ages 33 & 32. Total salary around $235K. Live like we make 1 income of $110k. Just starting to max two Roth 401K's and a family HSA. Ineligible this year to contribute to our Roth IRA's. We have a very simple lifestyle and are ok with that.
Ive been maxxing my 401k, HSA, and IRA for four years (since i was 29). My employer gives a 45% match that isnt capped, so every time the federal limit increases, so does their match. We just started maxxing my wifes IRA this year, and shes about to start a job with a 401k option which we will also max out. At 33 i have 362k in retirmenet assets, and shes just getting hers started so she has just over 1k
I've maxed a Roth ($7500 for 2023) and HSA ($3850 for 2023) since the first year I opened them about 12 years ago. However, at 54 I'm only about 60% of the way to maxing my 403b and I may not get there at all before I retire, which is fine with me. It's difficult to reach this kind of savings rate when you're single, especially since I earn less than $80k, which puts my total savings rate at about 40%. That includes contributing about $5000 into a taxable brokerage account. Having a taxable account to pull from to cover the taxes on Roth conversions, instead of paying taxes out of the conversion, can significantly improve long term growth in your Roth account. I just hope Roth conversions are still a thing by the time I retire, Congress has been hinting at changing things.
40, but at 38 I purchased my first house without a mortgage. (I was saving for a nice down payment in the NYC area and decided not to settle there... my nice down payment in NYC purchased a house where I moved to).
Been maxing out my Roth TSP since I was 30 making $75k a year. 38 now and additionally maxing out my Roth IRA and spousal Roth IRA for the last 3 years, while making ~$110k. No debt other than a mortgage. Student loans all paid off 10 years ago. My wife stays at home with our daughter. Net worth should be $1 million by 40 with our home, and retirement accounts over $1 million by 44-45. Plan on retiring at 58 when my daughter would be out of college.
I recently graduated and have been working for a year. I max out all the smaller ones: HSA, Roth IRA, and match my employer max on my trad & Roth 401k. Hopefully I’ll be able to max out before I’m 30!
34 and low 6 figures. This was only because I focused on maxing out our 2 Roth IRAs first. We have been maxing the Roths for 3 years while putting in about 15k into 401
I intentionally delayed maxing my 401k until after I could both get the full employer match and then max both my HSA& Roth IRA. Only then did I return to my 401k.
Once I paid my house after 7 years with a mortgage of $650.00 a month I contributed $640.00 per month into my 403B plan at work. It amounted to about 17% of my gross income not including social security and pension contributions.
10:42 - Current Rate set to be 457b maxed at $30k; My ROTH maxed at $7,500 and another $1,000 in a Spousal ROTH that may hit $7,500 by end of year For a TTL of $45k or 77.6% of income. This is only due to special circumstance and will probably drop to 40% next year and then possibly a fight for 15% in subsequent years.
Individuals who are age 50 or over at the end of the calendar year can make annual catch-up contributions. Annual catch-up contributions up to $7,500 in 2023 may be permitted by these plans: 401(k) (other than a SIMPLE 401(k) 403(b) SARSEP governmental 457(b)
Currently saving at 9% and I’m 28 years old with an income of $75,000 after bonus. All the sudden I feel very pressured to increase to 15% but I’m also trying to pay off a car loan and student loans.. 😬 Dreaming of being debt free (other than my house) but I think that will take 2 or 3 years. It’s hard to keep my priorities straight and pay that off before really upping my savings rate! I want to get going on building wealth NOW! I just have to remember that interest avoided is the same as a rate of return on my money (once the debt already exists, of course. Not advocating people to take out debt). It’s just hard!
Started maxing 401k at 48. Now I'm 51, and I max it out in Roth 401k. I am making sure to take the entire year because my employer has a 6% unlimited match. Our household income is around 170K and our total savings/ investments for the year will be about 90K. Got a bit behind through my 30s and 40s, but came out debt free.
@@brandon8531 We are both in our 50s now. This is the first year that I went with Roth. Come withdrawal time, I will be able to balance my taxable income to maintain the lowest tax bracket. At least that's the plan. The 170K is combined gross.
Weird not max out till mid forties. But we paid off our home at the a few years later. We also paid off my kids prepaid college education. So it took us a bit !o her but we had three main goals : retirement t , co!I've and debt free. We have been debt free at 50 s and no mortgage, 2.8 mi!lion in retirement and both kids college paid for.
It hasn’t been too long ago. Maybe 45-48 years old. Fully doing it now with catch as well. Hit 1M in investments a few years ago. Hopefully hit 2M in 2025-26 and keep growing. Always concerned about working in IT as you age. Many can’t stay in the game until retirement
I am at $19.5k right now, and I didn’t start contributing that amount until I was at about $120k in income in my mid-40s. By January, I will be maxing out at $23k.
I could’ve maxed out my 401(k) decades ago (I’m 56 now), but either the most we could put away was 8% or 10% of our income, or, I work for companies that, if you contribute too much into your 401(k) compared to “the average employee”, it gets returned next year because you are a “highly compensated employee”…. We can’t have the rich getting richer now can we? It’s all about saving more, cutting back on your lifestyle/living below your means etc.
I hit the maximum amount in 1992, when I was 36, when I started working for a Fortune 500 Insurance Company’s law department. In 1992, the 401k maximum was only $8728, so it was not very difficult to contribute the maximum amount especially because I was making in excess of $100k a year. My wife, who was also an attorney, also hit the maximum in the mid-90’s. I realize we are not the typical couple especially considering that we never had children and at the peak of our earning years we had a combined income in excess of $500k. I am retired now, but while I was working I always saved 25 to 30% of my gross salary.
I should be able to max this year for the first time at 28 years old. On top of my contributions my company raised their match up to 10% and I should receive $10,000 from them on top of my $23,000 thousand invested. It is mid April and already put $11,000 in for the year.
42 and making over 250k annual income. I started maxing out my 401k since the age of 32 when I started making over 180k. I only got out school at the age of 28 because of 6.5 years of PhD program 😢
I started maxing mine at around 65k salary, 30 years old. It was very hard. I'm 33 now making about 85k and still maxing. The main reason I was able to do it that low was because of living in Alabama, no debt and no kids. Maxing that and IRAs has allowed me to go from 0 net worth to well over 100k net worth in just 3 years.
The only thing that bugs me about going beyond the employer match in the 401k is 2:20. Imagine being 40 years old with 1.3 million and you can’t even touch it for almost 20 more years. My personal technique is 401k up to the match, Roth IRA, HSA, then regular ol brokerage account. Then if you are able to retire early, live off the brokerage account then if necessary Roth IRA contribution funds until you reach retirement age.
Kids today make serious bank compared to us older folks. When I was 35 I barely made the 401k max as my whole salary. Today folks make 3-5xs that number so maxing out could be easy to do.
LOL at people not able to max out your 401k with a 200k salary. My wife and I raised a child and soon as our daughter graduated highschool we started maxing out our 401k's. We make 140k combined income and both maxed our 401k's two years running. We still blow money for fun occasionally too, we also paid our house off in under 9 years.
I’m 29. I started maxing out my 401k (22,500) and IRA (6,500) this year . Job income is 100k before taxes and deductions, and I also get VA disability which comes to $46,000 per year. After contributing the 29,000 to retirement, I still have some wiggle room to dump another 800 into savings every month.
For 2024 can I contribute Upto 23000 and my husband can also contribute Upto 23000 a total of 46000 to max out? Or are we only allowed a total of 23000 for year 2024?
I didn't know the max amounts had become this high. I'm 58 and contribute $2k/mo ($24k) and my wife is 53 and contributes $1500/mo ($18k) to her's so our combined is $42k. Maybe I'll try to reach for $30k in 2024, but that is a stretch. I had been maxxed out in the past when the limits were lower.
