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FrioAg 00
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2:50p, 2/19/24
AG
Wealthy is a very subjective term, but I prioritized 401k contribution as a tool for saving early and got to maximum contributions within a few years. Around 30 I qualified for my company's 457B plan as well - same benefit, without the match.

If I stopped contributing today, these balances should have right around 6m when I'm 67 and can withdraw on them. They are designed to be my primary income source in true retirement.

So while I'm not calling that by itself "wealthy" it is certainly a tool for wealth generation.
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Brian Earl Spilner
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In reply to FrioAg 00 • 3:39p, 2/19/24
AG
This. Retirement accounts are incredibly powerful tools for creating "wealth", when used with the discipline required for them.

Starting a business is not for everyone, and in fact is very risky most of the time.

Not everyone is trying to be the next Bill Gates.
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MAS444
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3:44p, 2/19/24
AG
Yeah I know plenty of people who most would consider wealthy who work for "the man."
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RangerRick9211
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In reply to MAS444 • 4:46p, 2/19/24
AG
MAS444 said:
Yeah I know plenty of people who most would consider wealthy who work for "the man."


We found FIRE early in our careers and plan to downshift around 40. However, if I use today's value, assume we save the same (no raises), 8% and don't stop working until 58 the numbers get hilarious ($10m+). It's very feasible to got wealthy through W2 if you start early, max it, and work a few decades.
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Cyp0111
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In reply to RangerRick9211 • 4:55p, 2/19/24
Kids?
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Red Pear Realty
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In reply to Brian Earl Spilner • 5:21p, 2/19/24
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AG
Brian Earl Spilner said:
Starting a business is not for everyone, and in fact is very risky most of the time.

Not everyone is trying to be the next Bill Gates.


Well said. Some of you may know this, but I founded, and then less than two years later left, a company that would have made me hundreds of millions, if not billions of dollars over the course of my life. We made the cover of the local business journal…the headline article. And there is more to life than money. Elon Musk has been married and divorced multiple times, and at least one of his kids won't speak to him. He sleeps on the floor of his factories. I can't put a price on walking my kid to school and getting to work from home and being home for dinner each night.

With all that said, there is no need to sugar coat what a 401k is. We can look for that one guy that got rich and dream about what it would be like to be him, or we can be realistic. For non-highly compensated executives, that is being comfortable, at best, in retirement, if you are fortunate enough to make it to retirement age while contributing for 30+ years. I've seen 25+ year long tenured employees get the boot because they were replaceable. And I don't personally consider a $200,000 or $250,000 draw in retirement to be "wealthy". And I'm saying this out of love for the folks reading this, not to be a jerk or to disrespect anyone. If you are happy with that, amount, awesome, but it's not "wealthy" (to me, in a financial sense) in the USA.

Dinner is ready. My little ones eat early.
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Hungry Ojos
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5:43p, 2/19/24
You started a billion dollar company?
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RangerRick9211
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In reply to Cyp0111 • 6:18p, 2/19/24
AG
1. But my wife and I both continued working, so she's a day-care kid.
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Medaggie
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6:19p, 2/19/24
On the topic of IRA wealth vs business wealth vs RE wealth.

Person #1 at age 50 has ownership in a business worth 3M but business K1 produced close to 1M in come/yr for the past 3 years.

Person #2 at age 50 works a W2/1099 job making 400K+/yr and invests only in the stock market, has 3M in his IRA.

Person #3 at age 50 put all his money into RE and has 3M in RE net worth and made 200K rental income per year in the past 3 years.

All three have a 3M net worth if they quit working/sold everything. Who would you rather be?

My answer would be first #1 then #3 then #2. Why? I can quit tomorrow as person #1 as income is likely not to dry out. I still need to do some work as person #2 because RE income could be variable but could adjust my life if RE income goes down. As person #3, you are stuck working another 10 years for someone.

Owning a business has its risks BUT does have intangible benefits that a W2 worker does not have. You won't realize all the benefits until you create a business. Regardless all 3 will likely be very wealthy, but the differences matter.
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YouBet
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In reply to Red Pear Realty • 6:25p, 2/19/24
AG
Yes, but now we are qualifying everything. This got kicked off with "you can't get wealthy in the market" which is false.
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Red Pear Realty
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In reply to Hungry Ojos • 6:27p, 2/19/24
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AG
I co-founded a company about three years ago that has created tens of millions of profits to date. Several investors in that company exist on TexAgs and even this thread. If I had stayed we probably could all have been billionaires. My former partners will make lots of money, maybe even billions on their own. The important thing I'm trying to communicate is that to me, and of course others too, is that there are things more important in life than money. I'm sitting next to my wife and two year old watching the oldest two at gymnastics practice. That's pretty cool.
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Red Pear Realty
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In reply to YouBet • 6:31p, 2/19/24
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YouBet said:
Yes, but now we are qualifying everything. This got kicked off with "you can't get wealthy in the market" which is false.


You're one of my top 2-3 favorite posters on TA and we agree on 99% of stuff but not this. We were talking about 401k's. I am not qualifying. Whoever broadened to the overall market changed the subject, not me! Overall market and trading, of course. But investing in your 401k will not make you rich.
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aggiefan2002
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In reply to Red Pear Realty • 6:34p, 2/19/24
Red Pear Realty said:
Brian Earl Spilner said:
Starting a business is not for everyone, and in fact is very risky most of the time.

Not everyone is trying to be the next Bill Gates.


Well said. Some of you may know this, but I founded, and then less than two years later left, a company that would have made me hundreds of millions, if not billions of dollars over the course of my life.


I've read some crazy stuff on this website, but this might take the cake. Even saying "would have" instead of "could have" is just wild. Wild.
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EvenPar
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In reply to aggiefan2002 • 6:51p, 2/19/24
AG
aggiefan2002 said:
Red Pear Realty said:
Brian Earl Spilner said:
Starting a business is not for everyone, and in fact is very risky most of the time.

Not everyone is trying to be the next Bill Gates.


Well said. Some of you may know this, but I founded, and then less than two years later left, a company that would have made me hundreds of millions, if not billions of dollars over the course of my life.


I've read some crazy stuff on this website, but this might take the cake. Even saying "would have" instead of "could have" is just wild. Wild.


And just think if you put 100% of those billions in the market what it would be worth when you're 70 years old.
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Pacifico
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6:53p, 2/19/24
AG
I'm very concerned about how I will manage to get my money out of my IRA in 10 years or so.
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Red Pear Realty
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In reply to aggiefan2002 • 6:56p, 2/19/24
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Don't be average.
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Hungry Ojos
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In reply to Red Pear Realty • 6:58p, 2/19/24
Would you mind just generally telling us what kind of business it was?
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Brian Earl Spilner
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In reply to Red Pear Realty • 7:08p, 2/19/24
AG
Red Pear Realty said:
YouBet said:
Yes, but now we are qualifying everything. This got kicked off with "you can't get wealthy in the market" which is false.


You're one of my top 2-3 favorite posters on TA and we agree on 99% of stuff but not this. We were talking about 401k's. I am not qualifying. Whoever broadened to the overall market changed the subject, not me! Overall market and trading, of course. But investing in your 401k will not make you rich.


It seems like your little story there was just a humblebrag about how much money you could've had, not about 401k's.

Furthermore, you're telling people to not settle for average in their retirement, but also say it's not all about money. Pick a lane.

Bottom line is maxing your 401k for as many years as you can is the absolute smartest thing anyone can do for their retirement, and they will retire a millionaire (or in many cases, multimillionaire), guaranteed.
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GarlandAg2012
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In reply to aggiefan2002 • 7:17p, 2/19/24
AG
aggiefan2002 said:
Red Pear Realty said:
Brian Earl Spilner said:
Starting a business is not for everyone, and in fact is very risky most of the time.

Not everyone is trying to be the next Bill Gates.


Well said. Some of you may know this, but I founded, and then less than two years later left, a company that would have made me hundreds of millions, if not billions of dollars over the course of my life.


I've read some crazy stuff on this website, but this might take the cake. Even saying "would have" instead of "could have" is just wild. Wild.


I didn't believe him until he said he was the cover story of a local business journal
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Red Pear Realty
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In reply to Brian Earl Spilner • 7:17p, 2/19/24
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AG
I don't have anything to prove. If I did, I would have stayed. But what good is it for a man to gain the world but lose his soul? You think I waited years to humblebrag on a thread for millionaires about being a quitter? It was one of the most embarrassing things I've ever done, to me.

Most employees hit peak earnings at age 45 or so. Lots of corporate bulls get put out to pasture when they get too expensive or can no longer adapt. Why am I being downvoted for being honest about the game?
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Brian Earl Spilner
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In reply to Red Pear Realty • 7:22p, 2/19/24
AG
Probably because you're bringing up a one-in-a-million situation that you COULD'VE had to downplay the power of compounding interest.

Saying that 401k's are not for building wealth (because apparently your idea of wealth is being a billionaire) makes you sound pretty ridiculous.
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Pacifico
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7:34p, 2/19/24
AG
Most employees hit peak earnings at age 45 or so. Lots of corporate bulls get put out to pasture when they get too expensive or can no longer adapt. Why am I being downvoted for being honest about the game?

Like it or not he's got this right. Be careful here young people.
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Brian Earl Spilner
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In reply to Pacifico • 7:36p, 2/19/24
AG
And if you save properly, max your retirement accounts, and have emergency funds in order, it's not that big of a deal.
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Pacifico
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7:41p, 2/19/24
AG
Add a mix of DEI and good luck finding something at your level +45.
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Brian Earl Spilner
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In reply to Pacifico • 7:43p, 2/19/24
AG
All the more reason to be well invested.
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RangerRick9211
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In reply to Pacifico • 7:49p, 2/19/24
AG
Pacifico said:
I'm very concerned about how I will manage to get my money out of my IRA in 10 years or so.


I'm going to make this my signature.

SEP or Roth Ladder. Why are you very concerned? You have very real options to access 401k or Trads early.
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Red Pear Realty
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In reply to GarlandAg2012 • 7:55p, 2/19/24
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AG
I posted that so you could fact check me if you really wanted to. A lot of the rest, you wouldn't believe even if I shared picture proof.
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RangerRick9211
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In reply to Brian Earl Spilner • 7:59p, 2/19/24
AG
Brian Earl Spilner said:
And if you save properly, max your retirement accounts, and have emergency funds in order, it's not that big of a deal.


And by your bull years your returns > your W2. We hit that this year at 35.

Pile it into tax deferred early and make even more while it's early. It saves your on taxes and has more to compound on and to compound longer. I chased comp early and leveraged (MBA debt for more earnings). Now my W2 helps, but it's no longer the driving force. I'm starting to sniff the freedom, all on W2.
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Pacifico
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8:01p, 2/19/24
AG
The magical Roth IRA conversion. Hard pass. Do you sell Roth conversions?
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Brian Earl Spilner
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In reply to RangerRick9211 • 8:06p, 2/19/24
AG
I'm still somewhat early into my career relatively speaking, but my 2023 gains were already > my AGI.

Might be able to overtake my full W2 within a couple years.
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RangerRick9211
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In reply to Pacifico • 8:07p, 2/19/24
AG
Pacifico said:
The magical Roth IRA conversion. Hard pass. Do you sell Roth conversions?


Are you a bot?

Roth ladders are well documented. It's DIY. You do it, not an advisor, etc. There's no magic, just Google Bogleheads.

SEPPs are DIY as well. 72T are IRS rules.
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fullback44
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8:16p, 2/19/24
AG
I hit it at prob 34 after being self employed for about 6-7 years in petroleum… now I'm a little older and could care less about making a bunch of money any more … I like screwing off, sports, vacations and helping my business partner a day or two a week… working these days is driving 5 miles to the office, stopping at Starbucks for an hour on the way, checking emails at Starbucks, poking my head in at work, then going to lunch. After lunch I convince myself I'm working if I check some emails and then make a call or two and then take a nap at 3 or so …. That's hard work ! We make a lot of our money today through investments of the money we made over the time …. Aggie football weekends means taking off on Wednesday and reading all the sports crap I can find … one day In the next 20 years I will retire
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Cyp0111
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In reply to Pacifico • 8:43p, 2/19/24
This is the truth, you better either be a killer or 45+ you're on borrowed time at a large corporate. You can maybe find a level of safety as an advisor tag individual contributor but that pivot happens in mid/late 30s.


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Cyp0111
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In reply to Brian Earl Spilner • 8:43p, 2/19/24
I think the point is, there are multiple tools to build wealth. 401ks are a tool but they're backend wealth creation.

I've invested with RPR and can speak to the returns on the platform he left.

I do not think of this thread as 401ks vs after tax. It's grown to something more where people discuss via some level of anonymity their relationship with money and where they are and where they hope to be.

I personally do not find it taboo to discuss wealth or even what someone wants to have/create in life. I think calibrating plans, goals or even more importantly, how to accumulate, live and de-accumulate (is that a word ?) is a great conversation.
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YouBet
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In reply to Red Pear Realty • 8:46p, 2/19/24
AG
Red Pear Realty said:
I posted that so you could fact check me if you really wanted to. A lot of the rest, you wouldn't believe even if I shared picture proof.
I believe you. Found video of your last day there.



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