Finally reached $500,000

[exnavynuke]

Nords, this is encouraging to read. My DW and I also just passed the $500k mark and it felt like a grind reaching that point. I'm curious as to how long it takes most people to hit $1mil while keeping up their savings rate and the market staying on the upwards trajectory in the long term. I know there are too many variables to consider but could $500k be doubled in 5-7 years under "normal" circumstances?

Congrats to the OP for the $500k milestone!

At a 7% rate of return, an investment balance should double in ~10 years. That doesn't account for continued contributions however. So, with adequate continuing contribution amounts, it could reach $1 mil in 5-7 years.

 

[nash031]

Nords, this is encouraging to read. My DW and I also just passed the $500k mark and it felt like a grind reaching that point. I'm curious as to how long it takes most people to hit $1mil while keeping up their savings rate and the market staying on the upwards trajectory in the long term. I know there are too many variables to consider but could $500k be doubled in 5-7 years under "normal" circumstances?

Way too many variables to say with any certainty for all situations. Otherwise, yes, doubling any amount of money in 5-7 years is reasonable under the following conditions:

- you're still adding to the pile in the same way that got you to the present total.
- You're mostly invested in stocks and achieve "average" market returns compounding, and not trying to time the market.

A 7% return on investment will double without addition to principle in 10 years. A 10% ROI will double in 7 years without addition to principle.

To double your total in 5 years, assuming a 7% return, you'd have to save and invest an additional $50,000 per year.

 

[Hyperborea]

You can use the rule of 72 to estimate doubling time. Take 72 and divide by the compounding rate to get the approximate number of years to double. So, at 10% an amount would double in 72/10 = 7.2 years. You can also invert that and ask how long would it take to double an amount of money at 7% compounding rate? It would take 72/7 = 10 2/7 years. This is a linear approximation to the exponential curve and works ok for small interest rates. It's handy for quick mental calculations. There are a number of other similar numbers. The next most common is the rule of 115 for tripling times.

 

[Car-Guy]

I'm curious as to how long it takes most people to hit $1mil

While I have forgotten my exact age when I had "accumulated" my first million, I'm sure I've documented in some other thread(s). To lazy to go and look. But, I seem to recall that I was about 50 before I hit my 1st million. Second million was reached in less than 5 more years and after that it became pretty easy and quick to make more and more. (sort of like a snowball rolling downhill)

Factors like, getting the kids off the payroll laugh: sort of), paying off all debts, owning your own home outright, hitting your max earning years (salary) etc, all helped me with rapid accumulation later in life. YMMV

 

[mistershankly]

Factors like, getting the kids off the payroll laugh: sort of), paying off all debts, owning your own home outright, hitting your max earning years (salary) etc, all helped me with rapid accumulation later in life. YMMV

I think I'm at a crossroads with owning the home outright. I paid off our home almost 9 years ago and SoCal real estate prices has us sitting on roughly $1mil in equity. I'm tempted to draw about $10-20k per year for 3 years at 2.99% (12-month fixed promotional rates through a HELOC) to supplement monthly contributions to the FI accounts to expedite the progress (or at least front-load the investments more aggressively). I understand and am comfortable with the risk of doing this and the plan would be to pay off the HELOC within 5 years. Does this sound like a crazy idea? Has anyone ever used this strategy when sitting on so much equity? Any advice (or even a wake-up slap in the face) would be greatly appreciated.

*yes, I'm growing impatient with my progress to FI. Maybe I need a hobby?

update: I'm 46yrs old and DW is 45 wth plans of FIRE by 55.

 

[Neecy]

Nords, this is encouraging to read. My DW and I also just passed the $500k mark and it felt like a grind reaching that point. I'm curious as to how long it takes most people to hit $1mil while keeping up their savings rate and the market staying on the upwards trajectory in the long term. I know there are too many variables to consider but could $500k be doubled in 5-7 years under "normal" circumstances?

Congrats to the OP for the $500k milestone!

Thanks again everyone! Great question...I can't wait for it to double. Hi Nords!

 

[COcheesehead]

I've tracked it. We had about $600,000 in 2002. It doubled to about 1.2m in 2006. Then took until 2013 to double again. Had a little '08/'09 in there. We stand at about $4m today. To be continued.

 

[Pilot2013]

Is it as easy as taking what you put in additionally and adding it to the ROI? In other otherwords, if you add enough to change the ROI from 7% to 10%, double in 7 years?

 

[2017ish]

I think I'm at a crossroads with owning the home outright. I paid off our home almost 9 years ago and SoCal real estate prices has us sitting on roughly $1mil in equity. I'm tempted to draw about $10-20k per year for 3 years at 2.99% (12-month fixed promotional rates through a HELOC) to supplement monthly contributions to the FI accounts to expedite the progress (or at least front-load the investments more aggressively). I understand and am comfortable with the risk of doing this and the plan would be to pay off the HELOC within 5 years. Does this sound like a crazy idea? Has anyone ever used this strategy when sitting on so much equity? ....

Planning/thinking to sort of do this. We have a 200K HELOC set up and I'm thinking about drawing 30K or so each year to pay ~1/2 the cost of Roth conversions in our early retirement years. That will enable us to smooth the tax hit over several years, rather than just allotting it to the conversion year (and thereby seriously spiking our spending). Most likely, this would result in the drawn amounts being paid at sale of property, as we will likely be bought out by a developer well before the end of 10 years ....

 

[nash031]

Is it as easy as taking what you put in additionally and adding it to the ROI? In other otherwords, if you add enough to change the ROI from 7% to 10%, double in 7 years?

That'll get you close for an estimate. Mathematically, it's quite a bit different and the error grows over time. You'd be underestimating quite a bit.

 

[copyright1997reloaded]

Thanks to this recent stock rally, I have finally reached the half a million mark:

Congratulations on the milestone! The first one is the hardest, as you are starting from a low base. As the assets compound, growth (in terms of $) comes faster.

Also beware (be prepared) that on market downturns, the numbers also get bigger. In the late 2008/ early 2009 debacle, having multiple 100K+ loss weeks in a row was quite unpleasant and 'tests' your resolve to asset allocate and stick things out.

 

[aksteelhead]

Thanks to this recent stock rally, I have finally reached the half a million mark:



TSP - Military: $203, 849.83

TSP - Civilian: $122,349.01

Roth: $113,110.89

Savings: 50,090.48

Stocks: $812.52

OPM has $9,000 because I tried to buy my military time, but now I am on active-duty and can't request it back until I retire from the government

Savings 2: $2,062.13



From my $400,000 milestone post in 5/20/15:



TSP - Military: $158,846.27

TSP- Civilian: $91,851.46

IRA: $96,603.20

Savings: $51,470

Savings 2: $3,430.73



I'm single and spent my career in the military and federal government. I also have a Reserve O-5 pension at 60 yrs. I have a rental house with $60-70,000 in equity (did not count in my tally). Woo hoo!

Combine the TSP. It's just cleaner that way. I think the form is https://www.tsp.gov/PDF/formspubs/tsp-65.pdf. Congratulations on your milestone.

 

[Dawg52]

Well, I'm 45 right now and hope to do another 3 yrs in the military. If I do, then I will have an active duty pension. I'm on Leave Without Pay from the federal government, so at this moment I have 5 yrs as a government employee. After I finish the military in 2020, I want to return to the government (i have return rights within 5 yrs). I would like work until 57 years old and retire as a federal employee, and then I will have 16 years or wait 4 more years and retire at 61. I guess it depends on how far I reach or tired of working.

I do plan on working forever, but not based on the need to work, just to get out of the house

Congrats! If you do work another 12 years you should really have a nice portfolio. And with pensions......you will be in great shape. Keep up the good work!

 

[SPMW]

Thanks to this recent stock rally, I have finally reached the half a million mark:

TSP - Military: $203, 849.83
TSP - Civilian: $122,349.01
Roth: $113,110.89
Savings: 50,090.48
Stocks: $812.52
OPM has $9,000 because I tried to buy my military time, but now I am on active-duty and can't request it back until I retire from the government
Savings 2: $2,062.13

From my $400,000 milestone post in 5/20/15:

TSP - Military: $158,846.27
TSP- Civilian: $91,851.46
IRA: $96,603.20
Savings: $51,470
Savings 2: $3,430.73

I'm single and spent my career in the military and federal government. I also have a Reserve O-5 pension at 60 yrs. I have a rental house with $60-70,000 in equity (did not count in my tally). Woo hoo!

Congrats, and that's some serious progress since May 2015! Keep it up!

 

[Neecy]

In 2017 : Thanks to this recent stock rally, I have finally reached the half a million mark:

TSP - Military: $203, 849.83
TSP - Civilian: $122,349.01
Roth: $113,110.89
Savings: 50,090.48
Stocks: $812.52
OPM has $9,000 because I tried to buy my military time, but now I am on active-duty and can't request it back until I retire from the government
Savings 2: $2,062.13

From my $400,000 milestone post in 5/20/15:

TSP - Military: $158,846.27
TSP- Civilian: $91,851.46
IRA: $96,603.20
Savings: $51,470
Savings 2: $3,430.73

I'm single and spent my career in the military and federal government. I also have a Reserve O-5 pension at 60 yrs. I have a rental house with $60-70,000 in equity (did not count in my tally). Woo hoo!

Hey y'all! It's been awhile since I've posted an update. I thought I was going to retire from active duty in April, but then I decided not to self-eliminate from the AF. I also thought it would be a good idea to start repaying my severance out of my active duty retirement pay as soon as possible, but I think Uncle Sam can wait 3 more years. I just accepted a 3-yr assignment at higher headquarters, which very well may be my last assignment.

So without further ado,
TSP - Civilian: $159,276.36 (stopped contributing since Dec 2015). It has grown $59K without contributions.
TSP - Military: $314,419.37. I have been maxing out in the Roth TSP since Jan 2016.
Roth: $162,886.33
Savings: $22,157.28. This is what is left after buying a house in Nov 2017.
Total: $658,739.34

I'm happy with the growth and hope this market will continue to trend upwards over the next three years. Since I have to repay my severance, I expect it will take at least 4 yrs before I see my full pension. My goal in 2022 is to return to civil service and combine both TSPs after getting my match for 2015-2020 due to USERRA. I'm delighted at my TSP, but I know the market may experience a downturn in the next 5 yrs. I will just have to avert my eyes when that happens. Although, I've had a lot of twists and turns, I'm glad I stayed the course and recovered from my setbacks I've been lurking and occasionally posting on this forum for over 10 years and it's awesome to see my progress over time.

 

[Nords]

Although, I've had a lot of twists and turns, I'm glad I stayed the course and recovered from my setbacks I've been lurking and occasionally posting on this forum for over 10 years and it's awesome to see my progress over time.

Congratulations, Neecy-- what a long road you've had to get here!

 

[Neecy]

Congratulations, Neecy-- what a long road you've had to get here!

I know right! Thank you

 

[RxMan]

Congrats Neecy and thank you for your service!

 

[TDub]

Congrats! Can’t wait to see the light at the end of the tunnel like you do now [emoji4] Good luck at HAF!