EvrClrx311
Full time employment: Posting here.
- Joined
- Feb 8, 2012
- Messages
- 648
I wanted to pose a question, in an attempt to calibrate my mind towards an appropriate understand of what works best...
Assuming the goal is to FIRE around the age of 50...
Is there an ideal ratio of 401k vs taxable account values?
I've always had a mindset of getting the 401k as high as I possibly could, but does there come a point where it's better to have invested money other places. I'm not really talking about emergency funds, or cash, but the equity (growth) piece.
I'm currently 35, and have a bit of a unique situation with my job in that they set aside $34,000 a year towards my 401k. I've been putting in $18,000 myself. A total of $52,000 a year. By my math my 401k should get to the $1M mark sometime around age 42, and ideally in the $2M range when I'm 50.
I haven't bothered much in the taxable savings department to date, and was wondering if I should start ramping that up? Obviously, the more invested, the better in the long run... but specifically I wanted to know if it might be better to allocate some or all of that $18,000 away from 401k and into something else? I'd get the $34,000 contribution from work regardless of what I put in. Are there any benefits to having invested wealth outside of the 401k if my goal is to FIRE around 50? More specifically, does the 401k trap you in a way? I only vaguely understand the rules about planning scheduled early withdrawals from 401k... I guess I'd be using that if all my eggs were in the 401k basket and I wanted to Retire at 50.
Appreciate any thoughts or insights people have.
Assuming the goal is to FIRE around the age of 50...
Is there an ideal ratio of 401k vs taxable account values?
I've always had a mindset of getting the 401k as high as I possibly could, but does there come a point where it's better to have invested money other places. I'm not really talking about emergency funds, or cash, but the equity (growth) piece.
I'm currently 35, and have a bit of a unique situation with my job in that they set aside $34,000 a year towards my 401k. I've been putting in $18,000 myself. A total of $52,000 a year. By my math my 401k should get to the $1M mark sometime around age 42, and ideally in the $2M range when I'm 50.
I haven't bothered much in the taxable savings department to date, and was wondering if I should start ramping that up? Obviously, the more invested, the better in the long run... but specifically I wanted to know if it might be better to allocate some or all of that $18,000 away from 401k and into something else? I'd get the $34,000 contribution from work regardless of what I put in. Are there any benefits to having invested wealth outside of the 401k if my goal is to FIRE around 50? More specifically, does the 401k trap you in a way? I only vaguely understand the rules about planning scheduled early withdrawals from 401k... I guess I'd be using that if all my eggs were in the 401k basket and I wanted to Retire at 50.
Appreciate any thoughts or insights people have.