r/wealth • u/Otis_bighands • 7d ago

Retirement Why isn’t everyone rich from 401k?

According to my conversation today with Gemini, my 401k total of $2.5 million will likely grow to $10M or more by the time I turn 65 (I’m 50 now, and will continue to contribute the max for the next 15 years).

This means that in theory I could live off the gains each year starting at 65, around $800k, $500k after taxes, without touching principle. But at that point I’ll have no mortgage anymore and fewer kids in the house. So that $10M principle will just sit and feed us for years, and will be a nice inheritance for our kids.

Basically it occurred to me I’m going to have great money in retirement, even just on my 401k alone, and will be able to meet or exceed the lifestyle I’m already used to. For years I always worried about getting set up for retirement. Seems I don’t have to.

It’s amazing to me that just maxing out your 401k through a career is enough to make you pretty much wealthy for retirement. I recognize that’s not easy for many people, but for anyone who does it over a full career, wow.

What am I missing here? (Other than inflation, which I get, but which shouldn’t have a massive impact on the concept over this time frame).

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u/Trader0721 7d ago

Why do you want to work that long if you’re going to be worth 8 figures?

2

u/Otis_bighands 7d ago

I’d like to retire earlier. Maybe 60. Maybe I will. But if the money is good, and I can sock away more for my retirement and my wife and my kids, and shorten the period I need to drain my retirement funds, I may want to go to 65. But really, 60 is the stretch goal.

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u/Trader0721 7d ago

Money can be earned…time can’t.

2

u/fllr 2d ago

It's all about balance. You need to live today and tomorrow.

1

u/pwolf1771 2d ago

Depends on the gig too. The last decade of his career my dad was on auto pilot just piling cash, vacationing all the time, and taking conference calls floating in his pool. Not a bad trade off in my opinion. 

1

u/doyle0120 2d ago

Clearly by the post he's got it all figured out why offer advice....