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Originally Posted by E150GT
"They" all say sock away this much a month for 45 years and by the time you retire you will be worth millions. Is that realistically true? I am 25 now, and have been contributing for over two years now. Is it a realistic goal for me to retire at 65 or whatever and be financially independent, or is this accomplished in theory only? It seems every recession is a major setback to all the gains made in good times. What do you guys think or know about the truths about the 401k?
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I opened my IRA with the legal maximum of $600.00 the year when they first came out. I was in my early 20s and self-employed. Today, 33 years later, I'm still self-employed and have a collection of self-directed IRA, SEP-IRA, and Roth IRAs. I'm still dumping in the maximum every year. Workers with 401Ks can have a lot more advantages than an IRA. They are based on your salary as to how much per year you can put away, and of course some employers still match up to an employee's annual contribution. It's a no-brainer, since you are contributing money painlessly a little at a time so to speak. There will always be recessions....this one we're in may not ever go away, who knows. What's certain is that if you don't provide for yourself you will be a ward of the state when you can no longer work if you're broke. There are only two ways to get ahead for yourself over time. One of the ways is to amass a fortune in your savings and investment instruments, and the other is to get ahead with rental real estate property. Investment real estate is now eligible as an IRA. Of course there is a third way, and that is becoming some sort of government servant for most of your life and get a free pension for life.....if you have the stomach to do it. I'm not that servile a person to give up on myself as many do. Frankly, I don't need somebody telling me what to do for a paycheck. LOL!