I’ve heard a lot about maxing out my retirement account first, but just never understand the appeal of it.
I’m 25. My company matches 4% one to one. So for sure I’m going to take advantage of the company match. Plus my contribution (4% just to take advantage), this is gonna put about 16K-24K a year in the my 401K. I feel this is more than enough.
If I max out 401(k) and Roth, it’s going to be like 50K a year. If I use 8% annual compounding, I will have like 13million by 65… Like why do I need so much money when I’m old?
Sure there’s inflation which is 2%, market might be bad so I may only get 6%, even with all these assumptions I still have $3mm present value money by 65, by which I doubt I will retire.
Plus it’s not like I won’t have other assets, and relocating to a low COL after retirement will release lots of cash as well.
Can someone explain to me why should I max out my retirement account? Thanks
Submitted October 23, 2020 at 06:38PM by TheBigHump https://ift.tt/37ADM21
