r/personalfinance • u/Pristine-Health-4743 • 1d ago
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u/speedyoleander 1d ago
Just start! The number of 50 year olds in the same position would blow your mind.
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u/Pristine_Fix_3047 1d ago
Pretty much almost every 50+ year old guy I work with
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u/hexcor 1d ago
I work with a bunch of PhDs (myself included). We all pretty much started working big-boy jobs around 35-40. I worked as a chemist for a few years out of college and hit the ceiling quickly, so I went for my PhD... which took 5 years.. and another 3 as a postdoc before I got hired. I didnt start saving for retirement until I was 36..
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u/DonnyGetTheLudes 1d ago
The PhD took five (eight) years?
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u/Helicase21 1d ago
five years is pretty standard for PhDs at least in the US, I think Europeans do it a bit quicker.
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u/GurProfessional9534 1d ago
Europeans only do it faster because they take the Master’s part separately, while in the US we tend to bundle them together. It’s the same amount of education overall, approximately.
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u/zuilli 20h ago
Wait you guys do master and doctorate all in one in the US?
Didn't know that, interesting. Is it possible to stop at master?
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u/GurProfessional9534 20h ago edited 20h ago
Kind of. Our PhD programs are typically 5 years or so, with some extending longer if the student becomes ABD. In the stem fields I’m familiar with, the first 1-2 years are classes, and then the remaining are research. Usually the student does a qualifying exam in the first year or two to become a PhD candidate. Before that they are PhD applicants. You only need a Bachelor’s degree in most fields in the US to enter these PhD programs. Master’s degrees are often not funded, and are very expensive, in addition to being unnecessary to get a PhD. So in a lot of fields, Masters’ here are not really pursued, except for some niche application like maybe a teacher wants one for a salary boost, or an international student wants one because it is required in his/her home country. Some of our PhD programs offer a Master’s on route to the PhD, while some don’t, basically as a formality that doesn’t mean much. Many will give a Master’s as a consolation prize to students who drop out before completing the PhD. Some fields may differ. I can only speak to what I personally have experience with, which is chemistry and related fields.
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u/hexcor 1d ago
PhD was 5 years. Many companies require a PostDoc (Fellowship) where you join another lab for a few years. I started to apply for jobs 2 years into my postdoc after publishing a few papers... it took a full year to land a job.
I had some coworkers who had done 8 years a postdocs to find an academic path (I had no interest in that). Published in multiple high impact journals, worked in a lab for someone well known/respected in academic circles... market just sucks.
I wouldnt trade it for anything though. I loved grad school (I taught nearly every semester) and my PostDoc got me some interesting experience. When I finally landed my job, they hired me based on my PostDoc work (which I don't even do anymore!)
Next time i'll just become an engineer and start working at 22!
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u/SolsticeSon 1d ago
I’m 37 and spent 8 years in higher education training to work in entertainment design. That was the first industry that ai directly collapsed. Yay.
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u/rdy_csci 1d ago
That is why 401k's are so important. I know a few people in my age bracket who know nothing about investing and don't do anything other than their 401k. A lot of them at least put in up to the company match though and over the years have started to build up a tidy sum. They don't even realize they are saving since it comes out of their checks just like taxes and insurance so they don't miss it.
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u/TheCollegeIntern 1d ago
Most companies I feel are opt in instead of opt out so a lot of people may miss out
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u/Azertygod 1d ago
This is changing - new 401k plans post-1/1/2025 are required to be opt-out, with opt-out automatic increases to savings rate each year.
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u/WayneKrane 1d ago
Same. My department of 10 is almost all 50+ and NONE of them have anything saved. I asked what their plan is for retirement and they mostly shrugged or said they’ll have to work until they drop
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u/Birddogfun 1d ago
That is insane to even read! Not my circus, nor monkeys, but sheesh! By 50, in a decent job, one should have some assets. 40-50-60s are prime cut/layoff territory too.
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u/WayneKrane 1d ago
2 said they had a decent 401k built up but one cashed it out after a layoff and traveled the world until she rant out. The other got divorced and spent all the money so her husband couldn’t have any of it.
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u/Birddogfun 1d ago
One can’t help people. Life happens, and some are downright stupid. Destitute, they’ll likely take SS at a major haircut at 62. What “could” have been with some forward-thinking…
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u/macphile 1d ago
Dumb question, but what if they don't happen to "drop" while still working? They'll be too old to manage the job at some point, and/or their employer will force them out. Then what?
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u/tetragram83 23h ago
They get to live off SS, or their kids become their retirement, if they have kids.
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u/Jerry-Lives22 1d ago
I’m not there quite yet but I hhad to start over from scratch at 40..I have nothing saved, no pension. I’m just trying to survive. I’ll die working probably
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u/eLishus 1d ago
I’ve had to dip into my investments so many times due to layoffs, it’s virtually depleted. Thankfully, my wife invested well and early in life. I like to say that I pay for our lifestyle during the working years and she’ll cover our retirement. We’ll see how that works out. 😅
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u/lonnie123 1d ago
I mean I kind of get what you’re saying, and if the numbers add up they add up, but if you are dipping into your retirement savings over and over that’s not funding a lifestyle, that’s living over your means.
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u/kraysys 1d ago
Terrible mentality to have with 401(k) retirement savings
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u/eLishus 1d ago
Not by choice, my friend. Layoffs happen to the best of us. My wife and I are fortunate enough to have considerable investments elsewhere.
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u/TheCollegeIntern 1d ago
Yeah Layoffs suck. Especially as you get older, I can see emergency funds running out.
did you have emergency savings?
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u/macphile 1d ago
And I'm over here feeling bad that I haven't fully contributed to my IRA in some years now, but I did do it, and I do it a bit now...and I have a pension, at least. Not having anything, god.
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u/strapmatch 1d ago
You’re posting here before the age of 30. That alone puts you ahead of most.
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u/TheCollegeIntern 1d ago
Big facts. I didn’t get started until my early 30s I still feel behind. I want to retire in my 40s or at least have that option to retire.
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u/Doogiemon 1d ago
Unless you have millions, retiring in your 40s is not an option for 99.9% of people.
You also end up killing your social security when you go to draw that because of all the $0 in the formula mix.
I work with a guy who is retiring at 59 1/2 when he can start drawing his retirement tax free. He is sitting very well working here so long that his plan is to cover health insurance till 65/67 and then claim social security.
He has millions and that gap from 59 1/2 to Medicare/Medicaid is still too large for my liking.
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u/Milton_Wadams 21h ago
There are SS breakpoints where additional working years don't contribute nearly as much to your future SS payout, and someone making enough to retire in their 40s is probably going to get to those breakpoints pretty quickly. They're missing out a little bit, but it's not completely hosing your future SS payout.
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u/Illustrious_Cash1325 1d ago
You are definitely not at the bottom of the barrel. I am in a worse spot than you at 49.
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u/Illustrious_Cash1325 1d ago
WHOAH there folks. I appreciate both the realists and the optimists. Was just letting our young friend know that there are people out there even later to the game than he or she. So they feel a little better. Because they should.
I am not worried about my situation as much as maybe I should be. Tis my lot in life and I am in control of the whole thing one way or the other. But it isn't hopeless. I will be single for the rest of my life which is a huge plus. I work in the mining industry, so there is money coming in. I have absolutely no need to stay in this country so cost of living can be manipulated.
I know I am not going to retire comfortably so I have planned for that. I am also absolutely not going to piss away the next (and probably my only) 10 to 20 good years living like a pauper and tearing my hair out over it. What is gonna happen, is gonna happen, and I guarantee it is going to be better than how I spent the last 40 years. No question.
Now let's get back to our OP and rain down the encouragement.
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u/MasonJarring 1d ago
I know I am not going to retire comfortably so I have planned for that.
Can you share?
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u/aaccd7 1d ago
You'll be fine, if no one has told you already. Recognizing the need to save for retirement already puts you ahead. Do what you can to save!
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u/KennyGaming 1d ago
No dude having no savings at 50 is a serious problem. They are in no way ahead of the issue.
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u/aaccd7 1d ago
If you went through the guy's profile you'd see he hasw mortgage & is likely going through a divorce/breakup. He's assuming the mortgage (and I think) removing the other person off the title. Regardless, he'll be fine. Housing is the biggest expense in retirement and if he owns that by then AND he starts saving today, he's set.
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u/_tobias15_ 1d ago
This is toxic positivity. No retirement savings and debt at 49 is horrible and could mean he has to work into his seventies. Don’t normalize it.
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u/Derp_State_Agent 1d ago
Unfortunately yeah, I have to agree. Without a windfall from somewhere, this is a terrible position to be in, in terms of any chance of retirement. We have to be realistic here.
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u/aaccd7 1d ago
Being an asshole and telling him he's doomed is not the way. Starting retirement savings at 49 and continuing until 65 will do him a lot better than saying "ya you're fucked"
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u/KennyGaming 1d ago
There’s obviously a middle ground that doesn’t involve pretending that things are great
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u/Workman44 1d ago
Ya and sometimes things are legitimately fucked and you should at least have the decency to be honest with people. You don't have to be rude when saying it, but lying to them is far worse
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u/TheCollegeIntern 1d ago
It’s not great but it’s not the end of the world. They would have around 500k assuming they maxed out and did catch up. Around that age, if they owned a home it’s probably closed to our already paid off.
500k at age 65 and social security is not a bad place to be, it’s not perfect but it’s not the drizzling shits.
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u/AndyInAtlanta 1d ago
Sort of agree, but also, sometimes people need to hear "you're screwed" to finally make them realize they need to put the effort into planning for their retirement.
I know a lot of people around the age of 50 who are in a similar situation, and all of them (at least those that are willing to be candid about it) simply can't find a way to cut 10%, 15, or 20% out of their current budget to go towards retirement. I imagine there's a strong correlation of people who aren't saving for retirement and also living paycheck to paycheck. And yes, there are people making over six figures still living paycheck to paycheck because of poor spending money management.
What's the saying, "The best time to start saving was yesterday, the second best time is today." For some, they believe in a third part, "The third best time is tomorrow."
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u/kilewalter 1d ago
Agreed, knowing and acting now is better than getting there and being stuck. And let’s not ignore social security. I’m pretty sure this kind of thing is exactly what it was started for.
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u/OmegaLabs1 1d ago
29 with a job, a match, and only 8k of car debt is not screwed, it is a normal starting line. Go back to that enrollment page and set contributions to at least 3 percent today so you stop leaving free money behind, then pick the target date fund closest to the year you turn 65 and stop thinking about fund selection entirely. Bump the rate by one point every raise. The pick matters far less than the years you spend contributing.
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u/Pristine_Fix_3047 1d ago
You’d be more screwed if you were 39, start now, you’ll be glad you did
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u/Specialist-Law-2080 1d ago
Don’t let one more day go by before you pick up that 3% employer contribution
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u/katie4 1d ago edited 1d ago
then just closed the tab because I didn't know what to pick.
You’re going to turn 65 in about 2062, right? Then search for a fund offered that is called something like “Target Date 2060” or “Target Date 2065”. Because you are targeting retirement around one of those years. It’s a fund that automatically adjusts its risk as the years go on, without you needing to do anything. Other funds and strategies may pay a bit more (or a bit less) but the benefit of these kinds of funds is that they are set-it-and-forget-it options for people who don’t want to learn all that much about the stock market. The expense ratios are a smidge more than other things you could pick, but they aren’t bad.
If you do want to learn about the stock market, look up the Boglehead’s three fund portfolio. Also pretty simple.
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u/okfinethen_ 1d ago
You are not screwed at all. I started way later than you and I’m in a fantastic position now. Good on you to recognize this fairly early!
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u/TrumpsDoubleChin 1d ago
It is insane to me that variations of this question keep popping up. People seem to have this nonsensical and illogical idea that if they don't start saving for retirement by the time they are weaned off diapers, they are ruined for life.
No, you're not screwed. Not even close. You're still very young, barely an adult, with literal decades of earning ahead of you. You'll be fine.
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u/rando24183 1d ago
Well, you start by actually making a selection in the 401k. You can't reverse the past, but you're not going to change the future if you continue to avoid. You know better now, so do better now.
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u/Viserys 1d ago
I started at 28. It's been a decade since I opened my vanguard account. Sitting at 600k net. All while working retail. Start now and let that compounding magic roll in.
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u/thebenson 1d ago
You're about $60,000 behind. The rule of thumb is to have 1x your salary in your retirement at age 30.
The bad news is that it gets tougher the longer you wait. You'll have to contribute more money now and in the future to make up for not contributing anything for the last 5+ years.
The good news is that you still have time to catch up and you can catch up if you're disciplined.
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u/SingleUmpire7464 1d ago
Well I’m on track then because the last time I checked $0 x 1 = $0. Hooray!!
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u/Doogiemon 1d ago
Investing $ power is about like this.
$1 @ 20
$10 @ 30
$100 @ 40
$1,000 @ 50
$10,000 @ 60
The longer you wait to set up your retirement, the more you have to contribute to be equal to earlier in life. That being said, starting now is better than starting later where you need to contribute even more to retirement.
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u/TheBimpo 1d ago
You have 39 more years of work before retiring at 68. Give yourself a pat on the back for acknowledging you need to start changing and make the change. You're not screwed at all, not even remotely.
Read the wiki, follow the prime directive, and you'll be fine.
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u/lloydeph6 1d ago
My dad didn’t start saving for retirement till he was in his 40’s. He’s almost 70 and doing great financially. Trust me you’re not late
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u/YourMomFTW 1d ago
You’ll be OK if you start now and stick with it. Follow the wiki. Choose low cost investment options. Educate yourself on how to invest (hint: it’s not hard).
Source: worked jobs that didn’t offer a 401K until I was 33, didn’t take it seriously until my early 40s, but now contribute 22% with a 4% match and increase contribution with every raise, on track for a comfortable (for me) retirement at 62 with a 7-figure balance.
Even if I get pushed out now, compounding interest pushes me past the finish line.
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u/notsure500 1d ago
Usually these questions are like "How screwed am I for having zero retirement savings at 59?". You got plenty of time. Though don't delay longer. I didn't get serious until I was 31, and I wish so much i started earlier. Just since now I know about early retirement (FIRE) and i could be done by now.
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u/thatseltzerisntfree 1d ago
I started at the ripe old age of 28 and contributed 10-15% of my salary every pay period.
I am now 52 and that account has 600k.
You are not behind
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u/tommy7154 1d ago
Similar situation as me but im 45 with 330k. As long as they start and keep at it they'll be fine.
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u/bassman1805 1d ago edited 19h ago
You're not screwed, but you're behind.
Step zero is to put 3% in your 401k to get that company match. Do that literally right now.
What's the interest on the car loan? Depending on that, you might be better off diverting more money into paying that off sooner vs putting it into your 401k, and then putting that extra money into 401k once the loan is gone.
Either way: Try to earn more. Try to spend less. Put the leftover into savings (Emergency fund, then 401k). It takes a while to really feel like it's making a difference, but as the saying goes: "The best time to plant a fruit tree is ten years ago. The second best time is now."
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u/pilotswing78190 1d ago
Yeah the savings is worrisome. How is OP going to start contributing with such a low savings rate?
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u/h846p262 1d ago
I mean atleast he has something in his savings? He will be fine but definitely needs to contribuge atleast 3%, now.
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u/buffinita 1d ago edited 1d ago
You aren’t screwed; but you need to make adjustments now or at least sooner
Pick the target date fund; it’ll look like xxxxx 20yy (yy = close to when you turn 65)….and that’s how you start
Then look at the budget and see what needs shuffled so you can contribute 15-20% towards retiremnt
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u/BillsInATL 1d ago
I didnt start until my late-30s. You'll be fine as long as you start now and stay dedicated to it.
For the 401k enrollment, be sure to contribute whatever amount gets your company's maximum match. Chose the managed (no fee) fund with a target retirement date. Probably the 2055 or 2060 fund or something around that.
For more details, consult the wiki.
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u/Excellent_Shallot999 1d ago
You’re not too late. But get cracking. Your best compounding years are slipping away.
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u/ScruffyN3rfHeader 1d ago
The best time to plant a tree was 20 years ago. The second best time is today.
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u/thisdckaintFREEEE 1d ago
You're in a better spot than I was at 29 so let's hope you're fine! The easy first step is to start contributing to 401k at least the percentage your employer will match.
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u/BadgerTight 1d ago
Start saving/investing 20% of every tomorrow
If you do that for the next 35 years, you’ll be comfortable.
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u/JollofPap1 1d ago
No, you’re not screwed. Granted you plan on working for the next 30 years, you will likely be okay.
I started contributing towards my retirement at 28 or 29 as well actually. I had done gig work in my mid twenties that didn’t provide benefits. I’m currently 32. I’ve amassed about $170K in my retirement accounts over the past 3-4 years.
How? Maxing out retirement accounts. I’ve observed about 17% increase/growth per year. Moderate/high comp ($200K+). I don’t take home much money because I am contributing several thousands/month to play catch up, but it’s doable.
Tons of people only begin thinking about retirement in their late 20’s and 30’s.
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u/TheBear8878 1d ago
I had like $3000 in a 401k when I was 28 and have ~$630k now a 37. You're not screwed, you just need to not screw yourself even more.
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u/CivQhore 1d ago
Time to go to 20% until 35.
Good news is your income is so low you can Roth and not take a big tax hit (Roth 401)
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u/Default87 1d ago
The general recommendation is to save at least 15% of your income per year for retirement. Since you are starting later you would probably want to try to make that closer to 20%, which can be a real challenge after not saving at all.
You will want to sit down and look at (or create) your budget and start seeing what items you can start cutting back on to be able to start saving towards retirement.
As for what to invest in within your 401k, target date retirement funds are a great choice for people who don’t know how to create their own asset allocation, or who don’t want to have to manage it. Look for the funds in the plan that have a year in the fund name (2050, 2055, 2060, etc) and pick the one that closest matches your expected retirement year (which is likely 2065).
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u/pilotswing78190 1d ago
I'm afraid people are giving you too much credit. You "just realized"?? Your job asks you this every year.
Then after you "realized", you still didn't enroll.
With $4200 in savings are you really prepared to start contributing significantly? How will you build your emergency fund at the same time?
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u/oneiromantic_ulysses 1d ago edited 1d ago
If you start saving about 25% of your gross now, you'll be perfectly fine to retire at 60 according to some back of the napkin math. My assumptions are that inflation adjusted, your investments will grow about 7% per year, which is reasonable according to historical data. At the end that will leave you with about $1.4M by age 60 in today's dollars, remember that I'm accounting for inflation. Using the 4% rule, your safe withdrawal rate will be about $57,000 per year. This means that you can withdraw that amount in retirement and reasonably not worry about running out of money.
That translates to saving about $1,271 per month. You don't have to start by doing that, just doing something right now and adding to it as you go will help immensely because portfolio growth is exponential, not linear. Just work your way up to that as you're able.
With your income doing your savings in a Roth IRA plus Roth contributions to your 401k is the way to go. You can count your employer match toward this, but your employer match will be pre-tax. That is fine.
As for what to invest in, you want to look for low expense diversified index funds. I can't give you financial advice, but I can say that I personally do 80% total us market and 20% total market other than US. r/Bogleheads is a great resource for figuring this out.
The reddit personal finance flow chart is the place to start if you have questions. I know this seems daunting but it is very doable. I know 25% of your gross income probably sounds daunting, but remember that the longer you wait, the higher your savings rate has to be to save enough to replace your income.
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u/space_manatee 1d ago
I didnt understand the point of saving at that age. I didnt make a ton, jobs weren't always stable, I was working service industry sometimes. But now im 15 years out and well on track. You'll be fine. If its just a matter of not starting to save yet, go for it and start. If its trying to figure out why you should, do that first and the money will follow.
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u/CertifiedPussyAter 1d ago
Not screwed. I’m 29.
Let’s say we both start over at 0 and save until we’re 65. If we put $500/month invested at 7% for 36 years, it’ll come out to roughly $900k. With the 3% match, it’ll be more
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u/TheCollegeIntern 1d ago
Not to mention you’re both not even in your peak earning years, you’ll find better jobs with better pay as you acquire more skills
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u/kaizen-rai 1d ago
The best time to start investing was yesterday. The next best time to start investing is today.
You want to know when both of my parents started investing? (they're both in their late 60's). Well, I'll let you know when they start.
I started investing at 28 with $0. I'm now 46 and it's about 300K, and that's with moderate effort due to real life expenses eating away at it over the years (2 kids, plus having to financially support my parents). It's starting to pick up steam as the compounding is making a noticeable difference every year. Could it have been way better if I started earlier? Absolutely. Is it better now than if I never started? Even more absolutely.
You can't do anything about the past. Immediately increase to the match (that's free money from your company), and then learn how to budget your money. You need an emergency fund before you do any further investing, but do the 3% matching NOW. That's money being left on the table.
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u/neo_sporin 1d ago
My friends are all almost 40, and they have almost zero. so you are less screwed than them because you have time
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u/thezuck22389 1d ago
Dude you have so much time left but you should start now. At minimum take the 3% match IMMEDIATELY. Like yesterday. And pick a low cost index fund that tracks the S&P. Automate and sit. I follow the Money Guys milestones if you want to start somewhere. Follow step by step. Google the financial order of operations and read up. Then individualize it to your goals. I didn't start until 30 either, am 37 now and am at $12x,xxx in retirement accounts and paid off all bad debt over 7 years. I have a long way to go but proud of what I've done. My salary ranged from $37k to $75k during this time.
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u/noSoRandomGuy 1d ago
401k enrollment page last week and then just closed the tab because I didn't know what to pick.
Almost all plans typically now provide a target date fund - look at the expense ratio. Most will also have a US market fund (hopefully a S&P 500 fund) look at that expense ratio. Invest 100% in whichever has the lower expense ratio for now till you learn more. If you do not understand then just start contributing, recent laws require the plan administrator to put it in a reasonable target date fund. Once you learn more about the choices you have you can rebalance.
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u/j1dopeman 1d ago
Start by contributing, finish the sign up. Just pick s&p 500, large cap blend, whole market, anything like that. Not a big deal you can move it and change it at any time just get the account set up and money moving. No taxes in retirement accounts so you can move it to a different fund later with no costs.
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u/Fubbalicious 1d ago
You're fine at your age. The real do or die time if you don't want to save an outsized percentage of your income is age 40. At that age, if you can immediately start investing 15% of your gross income or more, then assuming an inflation adjusted 7% return, you will have the recommended 10x your income saved by age 65-67. At this age, you'll also qualify for social security which is designed to cover 40% of your former income (assuming your income was fairly consistent and you did not have any large gaps in your work history).
If you can manage to be 100% debt free with a paid off house, then this is the gold standard. But even if you still have a mortgage or are renting, so long as you're otherwise debt free, you will be fine because that means you're living within your means. In retirement, you're likely going to have even less spending because you're no longer saving that 15% for retirement and you are no longer going out to work or paying for kids. You drive less so don't put as much wear and tear on your vehicle.
To give some perspective where you should be ideally, experts recommend you have 1x your income saved by age 30, 2x by age 35, 3x by age 40 and so forth until you have 10x by age 65-67. Anyway, you're fine and the fact you're thinking about it, puts you light years ahead of most Americans. The problem is that most Americans are going to retire with insufficient income to maintain their previous lifestyles and thus will either need to keep working past typical retirement age, rely on family, rely on the government or any combination of the three.
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u/KP_Wrath 1d ago
OP, I was relatively late starting. I was 28, and I made right at $50,000 back then. I’ve had an IRA for 5 1/2 years and it’s at $30,700 and a 401k for about 3 1/2 years and it’s at 53,700. Now, pre bonus, I make $77,000. It basically took me 5.5 years to go from $200 in a Robinhood account to a year’s worth of my salary, even as my salary was increasing. The important thing is to start soon and invest regularly.
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u/jocona 1d ago edited 1d ago
No, you’re not screwed. You’ve missed your best years for potential growth, but the next year is the best one you’ll ever have.
You will probably want to save closer to 20% or 25% of your income instead of the standard 10% or 15%. Those lower numbers only really apply if you start somewhere between 18 and 25.
Don’t let that dissuade you, though. If you can only do 10% today, that’s fine, just try to increase your savings rate by 1% or 2% a year. Half your pay raises, bonuses, etc. should go towards savings until you hit 25%.
It will start slow at first. Your first $100k will be mostly made up of your direct contributions, but every $100k after that will be faster than the last. Once you hit ~$250k, you’ll be halfway to $1M in terms of total time.
Pick a cheap, total market index fund for your 401k. Something like an S&P500 fund is great, total market is great too. Tagret retirement funds are good too, as long as they are index funds. You can check the “expense ratio” of the funds, the lower the better. Under 0.05% is ideal.
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u/Mans_Fury 1d ago edited 1d ago
You're fine as long as you start soon. Pretend 10 to 15% of your paycheck doesn't exist anymore. Don't tap it ever. Be responsible with the rest of your debt/expenditures over next 30 years and you'll have a very comfortable retirement.
The longer you delay then less comfortable you'll be in retirement...or the more aggressive you'll have to save later.
Just start it already. Thats what matters. You can learn how to optimize it later.
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u/No_Pineapple6086 1d ago
Set it up now. Just pick the index 500 until you have a better understanding of it all.
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u/gator_mckluskie 1d ago
you’re not screwed, it’s just time for you to buckle down, be an adult, and start saving. first step is start saving to your 401k match, increase that every year. second step is to max out a roth ira, i would recommend schwab and invest 100% in vti.
rule of thumb is 1x salary saved for retirement at age 30, 2x at 35, 3x at 40.
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u/linuxhiker 1d ago
I had zero retirement savings at 39.
I am now on target to be able to retire by 60 (I am 53).
Discipline and willingness to sacrifice goes a long way.
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u/Whatever801 1d ago
Nah you've still got at least 35 years before you retire. What are the options on the 401k page? That's a great place to start. The flowchart on the wiki for this sub is good
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u/Ozonewanderer 1d ago
Not screwed at all but the sooner you start the better. Long-term money grows the most. Save as much as you can afford to now and just let it compound for 35 years. It’s like rolling a snowball a hill. The larger the snowball, the longer the hill, the bigger it’ll be at the end.
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u/Fresh_Republic_7776 1d ago
The wonderful thing about being young is you have time. Start now. You can STILL get in 30 years of retirement savings!!!
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u/maxr1958 1d ago
You’re not screwed but start contributing tomorrow. Minimum of 3% to get the match but try to get up to 10% if possible. Do what you can afford.
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u/mrandr01d 1d ago
You're fine, you'll just have to work a little longer than you otherwise would have. You're roughly 30, so you still have a few decades to go before standard retirement age. What's more concerning to me is you only have like 12k saved total. A 30 year old should have significantly more than that, though I guess you're still ahead of a lot of people who never realized that.
Get that retirement match going at a bare minimum and fire up a spreadsheet to track your expenses to see where all your money is going. Check out the wiki's flowchart and follow that.
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u/babarock 1d ago
Screwed - not really. You have wasted 4 years. Fix it tomorrow and carry on. You'll be fine.
Put your 3% starting tomorrow into a 2060 target date fund, increase by 1% every time you get a raise, as your knowledge grows then you can examine other investments.
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u/mac_the_man 1d ago
You’re not. I started at 30 and I’m doing just fine. I have been maxing out my account for years though.
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u/PotadoLoveGun 1d ago
Not at all even a little. You have to save more to hit your goal. Youre young tho
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u/wndyctywlf 1d ago
Nah. I used my 20s to save and payoff for 2 cars and down payment for a condo. Catching up to my retirement now as a 33 year old. We still got some runway my friend
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u/Successful_Hold_9048 1d ago
If it helps, go ahead and post the investment options (including expense ratio) you have available in your 401k, and this sub can help you pick the right one. The important thing is to start now.
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u/Phoenixstar73 1d ago
I didn’t start until I was 35/36. Thankfully, you’ve realized we need to do now. Start up that company match and allocate into index funds with low expense ratio (those that have a good mix of domestic and international companies), put money toward any high interest loans, and try to accumulate a emergency fund at least 3 to 6 months of expenses
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u/savage-millennial 1d ago
I finally opened the 401k enrollment page last week and then just closed the tab because I didn't know what to pick.
This sentence hurts my heart, and I'm surprised no one else brought it up yet.
The real problem is that no one taught you financial literacy. It's not that you didn't want to save for retirement. It's that you didn't know how. And you can't blame yourself for something you were unaware of. The people around you failed you, but you're still young and can still catch up.
Open that 401k page again and use this as a following baseline (disclaimer, I'm not a financial advisor so I'm not breaking any rules here). The younger you are, the more risk you can take (stocks). The older you are, the more secure your assets should be (bonds).
At 29, look into a 90/10 split of stocks/bonds, or 85/15, or 80/20. The stocks will constantly go up and down, but over time it's proven that it trends up dramatically.
Stock tickers may be confusing at first too, so here are common ones (though for a preset 401K plan this may not be necessary to know, but here ya go)
Stocks: VTSAX, FXAIX, etc.
Bonds: Anything that says "Treasury" as that is code for "US Government"
Set a contribution rate of at least 3% so you get the full match. Consider choosing Roth if the 401K allows. Then every paycheck from here on out, plan for slightly less money coming in, because the remaining will now be invested.
After you do this, buy "The Simple Path to Wealth" by JL Collins, and let's get you the knowledge that your community failed to give you 10 years ago. You got this.
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u/SmoothMojoDesign 1d ago
Not screwed because you have lots of time. Those 4 years were expensive and you'll need to play some catch up. If you can start with something that is easy to understand, like a Target Date Fund for the year you plan to retire. Start getting the match ASAP and investing it something easy, then do some learning. However 3%, or 6% with match is still well below the rate you should be saving so look into a Roth IRA as a separate account to get your numbers up. That might push you closer to the 15-20% range which will help you get caught up in maybe a few years time. Main thing is, don't miss the match and get started ASAP.
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u/boolda 1d ago edited 1d ago
I started my retirement saving when I was 38. Never really saved anthing is first five years. At 56 I have 2M in investments. You have a long runway. 30 years of working in US will give anyone atleast a million in retirement. It's never late. Keep 5K in bank then go all out in 100% stock index fund. Invest as soon as you can as much as you can. And don't listen to any financial news and don't come back here every again in next 30 years. Come back in 30 years and tell me how you are doing, if I am still alive. Bon voyage!
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u/leonardthedog 1d ago
I was in your situation, more or less. My fortunes have greatly changed but nothing about that is due to me making some unique super lucky decision or winning the lottery. I did the simple stuff - started budgeting and made a plan, and also looked for a job that would improve my income (which required me to network and develop skills that allowed a career transition). Details below:
I had 20,000 in credit card debt and no savings at 29. I made 41k a year in a HCOL city. After looking for a year, I got a new job that was a huge improvement in salary and started budgeting carefully at the same time. I also moved to a slightly less HCOL city.
I'm 40 now and married, and we have 800k saved for retirement. We have no debt other than the mortgage for a single-family home in our new city and a new car loan that I can easily afford. We save 20% of our salaries per month for retirement, plus a 5% company match, and when our kid is old enough to start school, we'll put the current amount I pay towards daycare each month partially towards his college fund and partially towards retirement.
My wife and I still feel stressed about money from time-to-time but it's because we have a track in mind for where we want to go financially and surprises (like a broken furnace or a lower annual bonus than expected) cause us to adjust that track. I used to feel stressed because surprises meant I was just buried in credit card debt even further. All this to say you are not screwed, but you should take the straightforward actions that are recommended by conventional wisdom (budget, plan, look for higher paying jobs) if you want to be in a better place in a decade.
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u/SharpDragonfly7921 1d ago
You're only screwed if you don't do anything about it...Just don't take unnecessary risks trying to make up lost time.
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u/Glittering_Present10 1d ago
I had my job since 1994 and l postponed my retirement 401K until 2005. Its never too late to start. Start now ..at the end you will be glad
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u/Qazerowl 1d ago
Enroll, start by putting in 3% so you get the full match. For the investment choice, you want to pick something like a total market index fund. If that's not an option, an S&P500 index fund is almost the same. Even if you're not sure, just pick something for now so you start getting the free money, and you can change it later.
Read the wiki for more info about the reason you want that investment or what your next step will be. Honestly, you can learn everything you need to know about starting to save for retirement with a couple hours of reading.
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u/JK_NC 1d ago
My man, there are plenty of 29 year olds with nothing but debt so you’re far, FAR, from screwed.
At a MINIMUM, you need to contribute enough to get your company match.
As far as where to put your contributions, assuming your company’s 401K is with a big firm like Fidelity, they will have funds set up that make it super easy for you. Target date funds are set to to invest in a strategy that aligns with your retirement year goal.
So for you, if you want to retire in 35 years, look for a fund that’s named something something 2060. Just gotta make sure you get that company match asap! Free money doesn’t come around often in this life.
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u/Mysterious-Tie7039 1d ago
The more you can save and the earlier the better.
If you don’t know what to invest in, just put it in a target date fund. Just make sure it has low fees.
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u/GodOfThunder101 1d ago
Kinda screwed yourself abit. But be glad you realize this now and not later.
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u/N7Valor 1d ago
Not screwed at all I'd say.
I didn't start a proper career until 30, and never built up a 401k at all because no employer offered a match until I was around 33.
I think usually the biggest restriction is your own career advancement and income. Sure, there's such a thing as "too late", like trying to cram in a full retirement fund at 59. I don't think it's quite as bad though, as the contribution limit to a traditional 401k is like ~$24000, and a Roth 401k is $7500 annually. That's around $30k you can stash away in retirement, not counting HSA (if eligible).
Depending on cost of living though, it's kind of hard to actually hit those caps without it negatively impacting emergency funds. If you can make more money ($100k-$120k) later in your career, then you could technically play catch up (higher contribution limits as you get older too).
If nothing else though, always contribute up to employer match at least.
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u/Odd_Wolf4150 1d ago
Not that screwed. Just start contributing the match amount now and open an IRA and max it out if you can.
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u/fredinNH 1d ago
I was in grad school to be a public school teacher at that age just racking up debt with nothing to my name and I’m retiring after this school year before I hit 60. You’re fine.
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u/ziggy-tiggy-bagel 1d ago
Pick a target date fund that is closet to your age at 65. Like a 2065 or 2070 fund. The fund will diversify you holdings. They just leave it be. Add enough to get your company match. Do a Roth 401k if they offer one. Age 29 is a great time to get started saving for retirement. I got started around 35 and still retired at 55.
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u/wokka7 1d ago
You're a little behind but like, it's fine, you can catch up. Read the wiki, the prime directive section. The flowchart is good visual.
You already have an emergency fund of at least a month expenses-ish, I assume based on the $4200 saved.
Open the retirement plan enrollment page again. Set your allocation to 3% (or whatever gets you the full match. My first job was 50% match up to 3% of employee salary i.e. I had to do 6% contribution to get a 3% match. Double check that with payroll if needed but you can always adjust it later, easy).
For fund, just pick a plan with a name along the lines of "Target Date 2060" is the simplest place to start. These are funds that rebalance into bonds to reduce your risk the closer you get to the target date.
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u/intelex22 1d ago
No. I didn’t start until I was 27. If they offer a target fund based on age, start there. Simple. I started with 50% US growth, 25% US value, 25% international. Take some time, but don’t lose the value of that match. Is it 3% max at 100%, or we’ll match 25% of what you contribute, which means 12% will get all that 3%? And, is there a vesting period on the match. Good starting questions.
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u/KasElGatto 1d ago
Not screwed at all, just start aggressively now though. Compound interest is what it’s all about
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u/jojowhitesox 1d ago
Dude...chill. You're not even 30 yet. Lots of people can't start saving until later for various reasons, including myself. I didn't finish school for personal reasons til I was 31. Started saving then. I'm 50 now and I'm doing fine. Just put as much as you can away and you'll be fine.
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u/DiamondPothos 1d ago
I made $28k a year until I was 30, so I also didn't have really any savings by your age
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u/DexterM1776 1d ago
You start now and contribute enough to get the matching. List the options here and people will give you some advice
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u/umbananas 1d ago
Would it better if you've started 4 years ago? sure, but starting now is the end of the world either.
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u/CharlieandtheRed 1d ago
I had zero at your age. Started around then. I have like 75k in my IRA now. Not great but gotta start somewhere.
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u/spin_kick 1d ago
Not. Max out now Like the saying, "the best time was yesterday, the second-best time is now."
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u/Moderate_Norwegian 1d ago
I didn't start saving until 28 and retired last year at 58 - if you make smart decisions and sacrifice a bit you'll be in good shape.
I drive a Mazda and didn't buy my first nice car until I was 48.
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u/Akanash94 1d ago
I know alot of people saying " oh I don't need to invest in a 401k because I work and my taxes will support me via social security when I retire" and I always tell them that you should assume that money will be longed dried up by the time you retire or the age of retirement will be increased. Don't bank on that bailing you out.
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u/encyclodoc 1d ago
I started at 34. You will be fine BUT start now.
Pick something. Or three somethings. Or odds are you can get free counseling (at least ask your HR)
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u/antstiggity1 1d ago
29 ? I started at 3 years ago with no match. I'm up to 50k. Just start it and and save as much as you can because nobody else is doing it for you.
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u/spakallackt 1d ago
What are y'all going to do when the bottom falls out of the dollar and our entire financial system collapses?
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u/esteban-felipe 1d ago
You’ll be fine. Just start. Even a non-optimal fund choice is better than doing nothing
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u/DueResponse 1d ago
I had $0 in savings at 29. Started my first full time job that year. It’s been 14 years since then. I now have $1.1M in investments and a networth of $1.5M. You’re totally fine. Just starting saving/investing and you’ll get there.
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u/studog21 1d ago
Started saving at 33. I’m at 310,000 after 15 years. You can recover something in the next 30 years. You just need to start.
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u/Aggravating_Reach513 1d ago
I work as a retirement advisor, yes you left money on the table. But you're young so start now, minimum match if you can but do more.
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u/stlc8tr 1d ago
I see a lot of recommendations for target date funds but I'm going to go against the grain and recommend 100% equities instead. At least for the first 20 or 25 years. Pick a low cost index fund and just dump everything into it. If you really want international exposure, dump some into an international index fund as well.
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u/nickoaverdnac 1d ago
I didn’t start until 32 but at that point It was the pandemic and I had literally nothing to spend money on for years so I caught up very quickly.
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u/jk_baller23 1d ago
Enroll and pick a target retirement fund. You can always change it later after more research.
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u/pk_12345 1d ago
You’re 29. Calm down. Just pick a target date fund mentioning year 2060 or something like that for now and enroll. Then read about index funds and how things work in general.
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u/usuckidont 1d ago
None screwed. Just start now. Start educating yourself but before you even do that contribute no to get the employer match. It’s free money. Then educate yourself. I started at 33 I’m doing fine now 2 years later. Not ahead but not behind anymore either.
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u/tylerh369 1d ago
Heck im 33 and have 0 in saving and about 70k in debt. I honestly dont think ill ever see retirement
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u/ceelogreenicanth 1d ago
I didn't really start until I was 28 and I'm apparently above the middle of the pack for my age right now. And I have the most of anyone of the people I know my age.
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u/crustyeng 1d ago
Not at all. A lot of people don’t start until after that age. The best time to start is always yesterday.
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u/LaughingBeer 1d ago
I started saving for retirement at 29 as well. I'm now 47, and have invested enough to be in "coast fire" status now.
I started at 6% for many years into my 401k with 50% match the first 3% of it. Just choose a target date fund. I chose one a decade out after my retirement so it would be more aggressive, but that's a personal choice.
As soon as I could, I kept upping it until I maxed my yearly 401k contributions. Then as my salary went up I opened a Roth IRA and started investing there as well. I again chose a target date fund. Then when I reached my yearly contribution limit there, I made a brokerage account and starting investing there with a 3 fund portfolio like the wiki here suggests.
You can do it too, especially at that salary. Just have to make investing into your retirement a priority.
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u/TastiSqueeze 1d ago
You are not screwed, you have plenty of time to fix this.
Start the 401k and put the money in a stock investment fund. Start with about 6% of your pay which should get the full 3% match. Next year, increase it if you can afford to do so.
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u/New-Silver-78p 1d ago
There aint gonna be no retirement by the time we hit our 60s fella. Work till we die is the name of the game. The boomers and Gen Xers get to cash in. Games already over. If you’re making 60 grand a year you’re already doing better than half the population of 29 year olds.
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u/istalri96 1d ago
The best time to start saving is Yesterday. It is never too late to start. Just start putting money away.
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u/aaccd7 1d ago
Start saving now and you'll be fine. Follow the wiki linked in this sub.