Crossing a milestone
You know what’s really great about getting married? Getting to calculate your combined retirement savings! 
When we added together our 401K and IRA balances, we saw that we have crossed the $100,000 mark with a few thousand dollars to spare. As a couple in our twenties (I am 26 and CB is 25), I think we are at a good place in terms of retirement
Saving consistently more than beating the market
I can’t say that I’ve always made the best decisions when it comes to money, either on earning or spending, but one of the things I’ve done right is to start saving for retirement with the very first real paycheck I got. CB also started saving in earnest once he got a full-time job with benefits. (I’ll take some credit in encouraging him to start a Roth IRA). He is on track to max out his Roth IRA for the 3rd year straight this year.
Our real returns are nothing to boast about. We invest in mostly index funds, with a few lower-cost mutual funds, so you can imagine that we tied our fortunes with the broader market itself. Even though I started investing at the HEIGHT of the market – late 2006, can I pick ‘em or what? – our account balances have been growing.
How? We have been consistent. As our annual household gross income increased (from $30,000 when I first graduated to ~$130,000 this year), we kept saving. When we went through bouts of part-time work and underemployment in 2008 and 2009, we kept saving. As I made money from this blog and when CB got overtime, we kept saving. We started with $4,000 in 2006, and then saved every single year after that. In 2010, including employer contributions, we had $30,000 put away. This year, we’ll be on track to save the same amount.
Most of our $100,000 is from our savings and employer contributions. Hopefully as our portfolio balances grow and time goes on compounding interest will start shouldering some of its load!
Looking forward
By the time we reach our 30s, I would like to have $150,000 or even – if we are really disciplined and lucky – $200,000 in retirement. Given that we will be in graduate school for a couple of years, I expect retirement savings will dip a little (no more 401Ks!). But I am determined to continue to at least max out our Roth IRAs even through our graduate school years.
I am grateful that we were in a position to save what we saved, and hope we can keep the momentum going.
image credit: wikipedia.org
That is great! I probably would have cried with excitement. You are rockin' it.
thank you. I do feel really lucky. fingers crossed for the future years!
Congrats!
Congratulations! That's really incredible. I'm maxing my Roth IRA but won't be anywhere near $100k by 30. One of the biggest pitfalls of being self-employed, besides paying more taxes, is no employer match.
I don't have an employer match right now, but I've definitely benefited from them in the past. CB also has a super generous 10% match, so we are very thankful for that. Congratulations on maxing out your Roth IRA!
Congrats. I too think I might have cried with excitement. Nice to see your due diligence pay off.
Now if I compare my contributions with my balances, I probably will cry.. with not excitement.
Are you saying your contributions are higher than your current balances???
Please let me know so I can reinforce my hatred of the stock market
Congrats! We only have about $85K in our retirement funds at 32 and 31, but we also have $80K tied up in our house and $10K in emergency savings. I'm hoping to up our retirement savings to about $25K/year once we've reached $20K in emergency savings.
You are doing great! I would love to be a homeowner by the time we are in our early 30s, but unfortunately I'm not sure how that's going to happen. I don't even know where we'll live by then.
Congrats! That is very inspiring & motivating
Congrats! That's a great achievement considering you're both so young.
Wow! Good for you guys! That's really awesome that you've been so consistent with your retirement savings.
We only just started Roth IRAs this year, but you have to start somewhere…it's nice to see how well it has worked for you, and even though our balance is little right now, I know we will see progress if we keep saving
Congrats! That's amazing, you and CB should be very proud!
Hey thats great. When I graduate college I hope that I will be able to say that my retirement account looks like yours before I turn 30
Congrats!!! That's amazing!
When I first started contributing to my retirement savings account, I once read that if I had $100,000 in investments by the time I turned 30, then I'd not have to contribute another cent and when I take out my money during retirement, I'd have $50,000 a year! Of course, now I know that that is just a ball park number and depends on the actual markets and ROI. But I learned my lesson early – have time on your side.
Big congrats to you and CB for having your act together at such a young age! You should be super proud of yourselves!
Thanks! We're happy. But I feel like we can never save enough for retirement – limited sources of cash but so many uses for the future.
Congrats! Thats awesome
My own net worth just hit $100K on April 27, and even in this market, I managed to keep it there. But Im already 30 now, you guys are really rockin'. I would probably have closer to $200K right now, except for 3 things – 2 bad real estate investments and a timeshare. It is possible to loose money on real estate even during 2004! Think long and hard before buying a house especially if you plan on moving before you have a paid off mortgage.
Hey thanks for dropping by. Congrats on your net worth crossing the six figure mark! I don't even want to calculate what our net worth will be once we take out loans for grad school.
Congrats on surpassing $100,000 in retirement funds! You guys must have an awesome combined net worth as well
At my current rate, I will probably hit that point at age 25 as well.
You know what I love doing? Looking at the graph of how my retirement contributions have grown, starting with the small bits I did while I was in school from internships and then how insanely they've grown now that I'm maxing out my 401(k)! That graph really shows me, like you said, that the contributions really make the difference, not the returns, at least while we're still in the accumulation phase.
Investing in your Roth IRAs while you're in grad school sounds like a good idea. Those will be low-income-earning years and when you come out, you two might not be able to contribute to them forever.
Your savings story is inspirational. Thanks for sharing your journey with us!
I am surprised it took me so long to check this out. Congratulations! This is a huge milestone that many people will not even see in their lifetimes let alone in their twenties. Stick to what is good for you and be sure you are using some asset allocation as to prevent any large losses. Matching the overall market index should be just fine for now but consider doing some additional research on some individual stocks for a percentage of the future amount in the 401k to put into specific stocks. You could take the additional few thousand for that. Speculating at our age can pay off big and will if you do your right homework and only allocate what you could afford to lose.
Great Jobs! I'm 31 and my husband is 34 and honestly, I have NO idea how much we have saved in our IRAs..don't beat me
Congratulations. Every little helps on your way to financial independence.
However when I recently had a hard look on the current market performance… Have a look yourself – inflation 2%+, administration fees 1-2% -> 4%.
There is no / very little incentive to save money, the more you have, the more you need just to maintain the same position. For example, if market performs less than 3%, you need to add additional 1,000 a year, just to be in the same place.
However, you are personally doing amazing! I am sure if you will manage to add additional $100 K every 5 years next 7-8 cycles you will be quite rich couple! Good luck. Enjoy your ride to financial independence.
Your idea is incredible. This is very ideal and I also like to have big milestone during my retirement.
Congratulations on making it to the big $100,000 milestone
You have set a high standard, but I am eager to read your blog and learn how you did it!
I'm a recent graduate with a new full time position. I'm working on a thorough budget, but cringing as I watch my income quickly decrease as I add up my fixed expenses. I noticed you emphasized that you saved after graduation. At what amount would you suggest taking your savings, and putting a chunk into investments? What would be the first investment you would suggest?
wow, CONGRATULATIONS on the 100,000 retirement savings!!! That's a MAJORLY impressive milestone! I feel very inspired! But as a current grad student, I just wanted to pass along a few words of caution: not all grad programs or even particular phases of graduate training legally allow you to contribute to an IRA. I found this out the hard way – only half of my graduate schools years will legally allow me to contribute to my Roth IRA, because during some of the training years my graduate stipend changes classification from "earned income" to "NON-earned income". I'm sure you and CB will keep on saving anyway! I'm much farther behind, but I'm hoping to open up a separate savings account to put aside money for retirement in during my non-contributory grad school years….and eventually add it in to a 403(b) when I become eligible (in the far, far future!)