Monday, December 20, 2010

My 401K

Over the past twelve months, I have watched my 401k steadily grow.  It is so exciting considering how much I’d lost in previous years.  I know that it is not the end of the year yet, but thus far, I am up 14.8%!  I am completely happy with that return!

This made me a little curious.  I noticed that I was able to see my account information up to 24 previous months.  This is where I was at:

4th Quarter 2008:
I started at $15,282.57
Ended at $12,450.17
That is a -19.7% loss Q4 2008.  Ouch!

2009 numbers were:
Started at $12,450.17
Ended at $20,732.80

This year, I started at $20,732.80 and am currently at $26,904.11.  I put in a little over $2,000 thus far (5% of my income,) my employer put in almost $900, and the market increased more than the two put together.   

If I put nothing else into my 401k, assuming an 8% return from today until I retire in 30 years, my balance would be: $271,691.70.  Assuming 10% return, I’d have $471,133.90. Lastly, assuming a 12% return (as Dave Ramsey does,) I’d have: $808,917.90.  Wow.  What a difference between an 8% return and 12% return.  Of course, once the debts are paid off and the 3 month emergency fund is in place, we will be increasing our contributions from 5% to 15%.  The numbers above are my 401k only.  Todd just started investing in his at work, and is doing well, considering it’s the first year.  Investing 15% of our income is a bit scary, because that’s an additional $500/month that would go toward investments. How in the world are we supposed to pay down our mortgage when we have that chunk going into a Roth IRA?  I’m sure when the time comes, we’ll figure it out.

No comments:

Post a Comment