How I built 270K 401K Portfolio in under 5 Years | Average 401K Balance By Age
In today’s video, I will go over how I built a 270K 401K portfolio in under 5 years. I will also go over my future projection and what I plan to do with it after I leave my company. If you are curious about what a 401K is and how to choose investments for your 401K, I have an entire video dedicated to that. I will leave the card and description below.
Just as an fyi, this is my second time building my 401K portfolio. My previous 401K portfolio balance was 227K with my previous employer, which took me 10 years to build and I rollover that balance to my traditional IRA. This previous balance was smaller compared to my current one because I contributed less and my previous employer’s match was also less.
Future Projection until 60 assuming I stay at my current job and a growth of 9.8%, the average S&P 500 returns:
Current rate: $4,812,391.73
Just contribute up to the 15K match: $3,582,846
Do nothing: $1,738,527.63
If I plan to leave the company:
Rollover to my IRA accounts for additional investment choices.
I will rollover my traditional 401K balance to Traditional IRA (need to pay tax at withdrawal).
I will rollover my Roth 401K balance to Roth IRA (for tax-free withdrawal)
Key Takeaways:
Always take the company match if offered, at least up to the match
Choose an investment. Don’t just let the money sit in the account doing nothing. Time is money.
Take advantage of Backdoor Roth if company allows it
Rollover to IRA when you leave the company
This goes to show the power of the 401K. If you are laser focused on making money, saving money, and investing money, you can create a large enough nest egg to retire early and retire comfortably. I am talking about world travel, just chilling on the beach, and even buying a Lambo if you choose to.
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DISCLAIMER: I am not a financial advisor. The content on this video is purely for entertainment purposes only. You are responsible for your own investing and financial decisions.
#401K #Investing401K #Build401KPortfolio
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