# 401k



## miguel (Mar 24, 2019)

if someone started working at 20 and retired at 70, how big would their 401k be if they maxed it out?  for 50 years they put as much money as the law would allow.  each year for 50 years they made about 50k annually working as a bricklayer.  they never had kids and never got married.  how big would their 401k be after 50 years if they decided to max it out?  i think that uncle sam puts a limit per year which i think is like 18 or 20k annually or something like that.  would their 401k be like 3 million approximately or more?  can someone please help me here?  thanks.


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## mathjak107 (Mar 24, 2019)

what answer to you want to hear ?  there is no answer to your question .


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## miguel (Mar 24, 2019)

well could there be a way to determine and at least get approximate information?


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## Don M. (Mar 24, 2019)

miguel said:


> if someone started working at 20 and retired at 70, how big would their 401k be if they maxed it out?  for 50 years they put as much money as the law would allow.  each year for 50 years they made about 50k annually working as a bricklayer.  they never had kids and never got married.  how big would their 401k be after 50 years if they decided to max it out?  i think that uncle sam puts a limit per year which i think is like 18 or 20k annually or something like that.  would their 401k be like 3 million approximately or more?  can someone please help me here?  thanks.



You can start here....there are numerous Internet sites that can answer your questions.......

https://www.bankrate.com/calculators/retirement/401-k-retirement-calculator.aspx


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## miguel (Mar 24, 2019)

do you believe it would be approximate estimates?


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## Don M. (Mar 24, 2019)

miguel said:


> do you believe it would be approximate estimates?



Quite probably.  You have a computer....you can search on virtually anything related to an IRA/401K, and find multiple sites which will tell you, with a high degree of certainly, what you can expect.  Bankrate.com is just one of dozens of sites which contain valuable information....start searching.


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## Old Dummy (Mar 24, 2019)

miguel said:


> if someone started working at 20 and retired at 70, how big would their 401k be if they maxed it out?  for 50 years they put as much money as the law would allow.  each year for 50 years they made about 50k annually working as a bricklayer.  they never had kids and never got married.  how big would their 401k be after 50 years if they decided to max it out?  i think that uncle sam puts a limit per year which i think is like 18 or 20k annually or something like that.  would their 401k be like 3 million approximately or more?  can someone please help me here?  thanks.



*If* they invested in the stock market (you didn't specify), meaning a total stock market index fund, it would be worth millions. Something more than $5M -- off the top of my head. 

Since 1926 the S&P 500 has gained an average of 10% per year. Under the "Rule of 72s" a lump sum will double in about 7.2 years if it averages 10% per year. If one adds to the initial lump sum continually, every month as is prudent, then of course the number will be much larger.

If one wants to get rich quick, buy lottery tickets or go to the race track. If you want to get rich slowly, buy and hold the entire stock market, add to it regularly, give it a few decades and you will be there.


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## Knight (Mar 25, 2019)

No way to know what your health will be like at age 70. The actuarial tables for a man with no wife or children & 50 years of hard physical labor don't favor a long lifespan. Having a large amount is nice but, with no one to share it with, whatever the amount what difference does it make?


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## OneEyedDiva (Mar 29, 2019)

mathjak107 said:


> what answer to you want to hear ?  there is no answer to your question .



LOL Mathjak!


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## OneEyedDiva (Mar 29, 2019)

Miquel....pick the figures that would represent "maxing out" then use this savings calculator. Doesn't matter how much the brick layer made...it matters what he put into the 401K for those 50 years.  For this calculator to work, you need to input a reasonable annual compound interest rate (hopefully this 401K is paying more than the 3.50% shown as the default) I think 6.5 - 7% is reasonable though not optimal. Use the drop down menu next to that field to go to annually...you *do not* want to leave it at daily...you'll be scrolling for days. The result will show you the total amount plus how much of it is in "interest"...that is the only term Hugh Chou uses.  http://www.hughcalc.org/savings.cgi
Now if you want to see how much this 401K plan will pay out at retirement, use this calculator.  You can set it for how much you want on a monthly basis, what annual percentage you want or how many years you want your payout. Or you can play around with all three. Remember the figures you get are not etched in stone. http://www.hughcalc.org/rdur.cgi
Have fun.


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## mathjak107 (Mar 29, 2019)

just a word of caution ---the problem with these calculators is they don't consider sequence and balance .... stock markets as an example return about 9-10% on average over the long term  ... but what if the highest years  that make up the average  are in the beginning  when you have little saved and the worst years are later on when your fuel tanks are full ?  

it is like a   7% drop which is not a big drop , in my early years may represent at best a few months   of contributions to my 401k ..today a 7% drop represents 9 years of maxing out my 401k at catch up ....
so these calculators that use an average can be way way off .... in fact any retirement calculator that asks you to enter an average return can be off by as much as 15 years in how long the money will last  just based on the order of the gains and losses even though the average return is identical .


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## gumbud (Mar 29, 2019)

the last time I spoke to my fund manager - he said " your super will probably run out when you're in your 80's - didn't think I'd even make that - so rubbing hands or am I?


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## OneEyedDiva (Apr 7, 2019)

mathjak107 said:


> just a word of caution ---the problem with these calculators is they don't consider sequence and balance .... stock markets as an example return about 9-10% on average over the long term  ... but what if the highest years  that make up the average  are in the beginning  when you have little saved and the worst years are later on when your fuel tanks are full ?
> 
> it is like a   7% drop which is not a big drop , in my early years may represent at best a few months   of contributions to my 401k ..today a 7% drop represents 9 years of maxing out my 401k at catch up ....
> so these calculators that use an average can be way way off .... in fact any retirement calculator that asks you to enter an average return can be off by as much as 15 years in how long the money will last  just based on the order of the gains and losses even though the average return is identical .


You're right MJ. Most of the retirement calculators I've checked out are quite inadequate. I've seen those quickie ones that don't count your pension or SS income...they assume everyone these days only have 401Ks.  None of them have fields for retirees who continue to invest or increases or decreases in investments. Even the ones touted by different fund companies and AARP don't measure up. I found a very comprehensive one years ago but forgot what siteI found it on. CNN Money 101 also had a good, comprehensive one but it's no longer available. These calculators are meant to give people ballpark figures anyway so they aren't absolutely in the dark about what they may wind up with in retirement. Any amounts stated will have to be tweaked again and again...once one is close to retirement and several times during retirement.


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## mathjak107 (Apr 7, 2019)

OneEyedDiva said:


> You're right MJ. Most of the retirement calculators I've checked out are quite inadequate. I've seen those quickie ones that don't count your pension or SS income...they assume everyone these days only have 401Ks.  None of them have fields for retirees who continue to invest or increases or decreases in investments. Even the ones touted by different fund companies and AARP don't measure up. I found a very comprehensive one years ago but forgot what siteI found it on. CNN Money 101 also had a good, comprehensive one but it's no longer available. These calculators are meant to give people ballpark figures anyway so they aren't absolutely in the dark about what they may wind up with in retirement. Any amounts stated will have to be tweaked again and again...once one is close to retirement and several times during retirement.




the calculators that stress test portfolio's for success rate really don't need to know a thing about your ss , alimony , pension , etc .... all the calculators that stress test p[ortfolio's do is subtract that out and see what the capability of the portfolio is all by itself ..

then any other income gets added  to give you a total capability ...

so if i need 100k a year  and my ss and pension is 60k , i need a portfolio allocation that can support 40k for as many years as i have in retirement with the allocation i want to use ....

so the calculator would pretty much do the work of the chart which has already been done .... you want at least a 90% success rate ...

you can see 50/50 for 30 years will support 40k with a 1 million dollar portfolio . you can see trying to achieve 40k with just fixed income alone would be as risky as can be .


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