$1k a month for 15 years = $500k and $50k/yr. for retirement

Isn't the max contribution to a roth IRA like half that?
 
boingyman said:
First of all Dave Ramsey’s advice is only good towards people that are horrible with money and are financially illiterate. Second of all you can’t invest $1000/month ($12k/year) into a Roth IRA for a single person since the max is $6500 with the exception of a mega backdoor Roth IRA conversion or a simple Roth IRA if you are eligible for either or. If you’re married, thaen yes you can max both you and your spouse at $13k/year in a Roth IRA. Most people working also have access to some form of retirement plan whether it’s a 401k or equivalent (403B, 457, TSP, etc). Many of these accounts also have Roth versions if that’s what you prefer so it’s possible to contribute much more than that.

There are also nuance and no guarantee in terms of average ROR when you retire because no one can predict the market with 100% certainty and many of these estimates are usually based on historical returns of the S&P500. It would be foolish to think that you will continue getting ~10% return year after year until you die. We can use the dotcom crash as an example. Let's assume you have all your money ($500k) in SPY and you are finally retired. In 2000 the S&P500 was down about 10%. You had to use $50k of that. So now your $500k is closer to $400k. You're hoping 2001 would be a better year and you need to use up $50k again, but then the market dips another 13%. Now it's 2002 and you are down to roughly $340k. You're thinking ok 2002 will be good, but the S&P500 drops another 23% and you used up $50k again. Now you are down to about $220-225k, which is less than 50% and it's only been 3 years. You get a good 2003 at 26% gain, but now that's based on ~$225k and you had to use up another $50k so it's nearly a wash year, however 2004-2007 wasn't all that great and you watch your retirement account slowly dwindle down. By the time 2008 hits you are down to $100k (less actually). Then 2008 market crash hits. If you were forced to take out $50k you would be down to about $10k. So less than 10 years you are now broke and back to work as a greeter at Walmart.

With that being said overall $500k in a Roth account at retirement is decent assuming you also get social security, and you can live within your means. If you also have a decent pension and a house paid off then you could potentially live a comfortable life assuming you are healthy and able.
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boingyman said:
First of all Dave Ramsey’s advice is only good towards people that are horrible with money and are financially illiterate.
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Yeah but that's most people.

Even half the people that think they're good with money aren't.

If you're one of the few that has such a high financial literacy that you can do better with your own plan than on Dave's, then good for you. But that doesn't mean his advice is bad.

If you're drowning in debt and struggling to get ahead then his plan is for you. If you're not, then you don't need him.
 
I'm just going to start making meth when I inevitably get cancer from my degenerate lifestyle.

Or set up traps to make people value their life jigsaw style...sorry I was marathoning saw.
 
Fedorgasm said:
Yeah but that's most people.

Even half the people that think they're good with money aren't.

If you're one of the few that has such a high financial literacy that you can do better with your own plan than on Dave's, then good for you. But that doesn't mean his advice is bad.

If you're drowning in debt and struggling to get ahead then his plan is for you. If you're not, then you don't need him.
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I'm not saying everything that Ramsey say's is bad, but there are some things he recommends that is not ideal or is sub par at best. I agree that he is a decent resource for those that are horrible with money and drowning in debt as he is good at telling you how it is and is straight forward with his advice.

I also agree with you that some people that think they are good with money are not, but some people have different goals and every situation is different so I can't really judge. Also sometimes YOLO. Prepare for the future, but enjoy the ride along the way because you never know what will happen.
 
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boingyman said:
First of all Dave Ramsey’s advice is only good towards people that are horrible with money and are financially illiterate. Second of all you can’t invest $1000/month ($12k/year) into a Roth IRA for a single person since the max is $6500 with the exception of a mega backdoor Roth IRA conversion or a simple Roth IRA if you are eligible for either or. If you’re married, thaen yes you can max both you and your spouse at $13k/year in a Roth IRA. Most people working also have access to some form of retirement plan whether it’s a 401k or equivalent (403B, 457, TSP, etc). Many of these accounts also have Roth versions if that’s what you prefer so it’s possible to contribute much more than that.

There are also nuance and no guarantee in terms of average ROR when you retire because no one can predict the market with 100% certainty and many of these estimates are usually based on historical returns of the S&P500. It would be foolish to think that you will continue getting ~10% return year after year until you die. We can use the dotcom crash as an example. Let's assume you have all your money ($500k) in SPY and you are finally retired. In 2000 the S&P500 was down about 10%. You had to use $50k of that. So now your $500k is closer to $400k. You're hoping 2001 would be a better year and you need to use up $50k again, but then the market dips another 13%. Now it's 2002 and you are down to roughly $340k. You're thinking ok 2002 will be good, but the S&P500 drops another 23% and you used up $50k again. Now you are down to about $220-225k, which is less than 50% and it's only been 3 years. You get a good 2003 at 26% gain, but now that's based on ~$225k and you had to use up another $50k so it's nearly a wash year, however 2004-2007 wasn't all that great and you watch your retirement account slowly dwindle down. By the time 2008 hits you are down to $100k (less actually). Then 2008 market crash hits. If you were forced to take out $50k you would be down to about $10k. So less than 10 years you are now broke and back to work as a greeter at Walmart.

With that being said overall $500k in a Roth account at retirement is decent assuming you also get social security, and you can live within your means. If you also have a decent pension and a house paid off then you could potentially live a comfortable life assuming you are healthy and able.
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Great advice, certainly more informative than the video, in real life terms and situations.
Beautifully written, thanks sir.
 
Dave Ramsey has a lot of great advice and some advice i disagree with. However, I discovered him in my early 20s and started putting money into my retirement account because of him. Its over 300k now so I should be chillen when I'm old.

Main take away is if you're over the age of 18 and youre not putting any money into a retirement fund that mirrors the S&P 500 or something similar youre a bum. The power of compounding is how you get rich with this type of stuff.
 
Bornstarch said:
I just wanted to share this video for people who are thinking about retirement. Dave Ramsey breaks it down in simple terms

So, if you invest $1k a month into your ROTH IRA for 15 years
At the end of that 15 years, you will have half a million dollars
And with that 500k, you will receive $50k a year for retirement.

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He's bang on for personal finances but a pandering moron to women and female logic. He scolds men and reads Bible verses but he skips (conveniently) the part about wives submitting to their husband. He's based for personal finance but a blabbering idiot and moron when it comes to modern women, dating, and marriage.

Case and point, you can be spot on for your finances and your wife can run up debt, and divorce grape.

Some of these divorce call in shows are comical. He encourages the best things with respect to 0 debt and then shoots himself in the D by suggesting men marry modern women. I'll bump some when I get a chance.
 
gonads20 said:
Dave Ramsey has a lot of great advice and some advice i disagree with. However, I discovered him in my early 20s and started putting money into my retirement account because of him. Its over 300k now so I should be chillen when I'm old.

Main take away is if you're over the age of 18 and youre not putting any money into a retirement fund that mirrors the S&P 500 or something similar youre a bum. The power of compounding is how you get rich with this type of stuff.
Click to expand...

Agreed. He's overall a net positive minus marriage and his pandering to women. Like common sense is great but forget it. Wifey poo with 100+ bodies wants a huge marriage. Oh btw she's got 300k in debt for her PhD in gender studies. <Lmaoo>
 
boingyman said:
First of all Dave Ramsey’s advice is only good towards people that are horrible with money and are financially illiterate. Second of all you can’t invest $1000/month ($12k/year) into a Roth IRA for a single person since the max is $6500 with the exception of a mega backdoor Roth IRA conversion or a simple Roth IRA if you are eligible for either or. If you’re married, thaen yes you can max both you and your spouse at $13k/year in a Roth IRA. Most people working also have access to some form of retirement plan whether it’s a 401k or equivalent (403B, 457, TSP, etc). Many of these accounts also have Roth versions if that’s what you prefer so it’s possible to contribute much more than that.

There are also nuance and no guarantee in terms of average ROR when you retire because no one can predict the market with 100% certainty and many of these estimates are usually based on historical returns of the S&P500. It would be foolish to think that you will continue getting ~10% return year after year until you die. We can use the dotcom crash as an example. Let's assume you have all your money ($500k) in SPY and you are finally retired. In 2000 the S&P500 was down about 10%. You had to use $50k of that. So now your $500k is closer to $400k. You're hoping 2001 would be a better year and you need to use up $50k again, but then the market dips another 13%. Now it's 2002 and you are down to roughly $340k. You're thinking ok 2002 will be good, but the S&P500 drops another 23% and you used up $50k again. Now you are down to about $220-225k, which is less than 50% and it's only been 3 years. You get a good 2003 at 26% gain, but now that's based on ~$225k and you had to use up another $50k so it's nearly a wash year, however 2004-2007 wasn't all that great and you watch your retirement account slowly dwindle down. By the time 2008 hits you are down to $100k (less actually). Then 2008 market crash hits. If you were forced to take out $50k you would be down to about $10k. So less than 10 years you are now broke and back to work as a greeter at Walmart.

With that being said overall $500k in a Roth account at retirement is decent assuming you also get social security, and you can live within your means. If you also have a decent pension and a house paid off then you could potentially live a comfortable life assuming you are healthy and able.
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This is so well said. I have no jokes on it, just wanted to commend you for sound financial advice.
 
Retirement isn't something I've ever considered. I'll die while I'm at work most likely. Not because I want to, because I'll have to
 
My dad regrets not retiring earlier. He is almost 80 and has been retired for 15 years, and he basically has not touched a lot of his money. He's living off the returns and social security. He overestimated how much he'd need, and he thinks most people (at least middle or upper class) do that.
 
I'm not watching the video but lol at what's written in the OP. Using averages without considering variance to map out your future is not a good idea.
 
chimpoehurricane said:
Agreed. He's overall a net positive minus marriage and his pandering to women. Like common sense is great but forget it. Wifey poo with 100+ bodies wants a huge marriage. Oh btw she's got 300k in debt for her PhD in gender studi
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chimpoehurricane said:
Agreed. He's overall a net positive minus marriage and his pandering to women. Like common sense is great but forget it. Wifey poo with 100+ bodies wants a huge marriage. Oh btw she's got 300k in debt for her PhD in gender studies. <Lmaoo>
Click to expand...

100 percent agree. Bro, when dudes call in about getting married and gives them terrible advice about combining finances and paying off the wifes student loans because its "their" debt I roll my eyes hard. Hes a very naive christian boomer when it comes to relationships. When it comes to money i agree with a lot but when he talks about values and religion I take that shit with a grain of salt or i discard it.
 
gonads20 said:
100 percent agree. Bro, when dudes call in about getting married and gives them terrible advice about combining finances and paying off the wifes student loans because its "their" debt I roll my eyes hard. Hes a very naive christian boomer when it comes to relationships. When it comes to money i agree with a lot but when he talks about values and religion I take that shit with a grain of salt or i discard it.
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He's new think Christian. IE pandering to women. The part in his holy book about wives submission to her husband he leaves out BUT he Bible thumps men and shames into joke that is marriage today.

He's based on financial advice and "debtor is enslaved to the lender" which is biblical and older quote thrn the pyramids. There's a lot of Karen's and tiktok rubbish advice. So much promo for leverage and debt financing.

Dave overall is a net positive but fuck people need to screen their gurus and exercise common sense. He panders to women and marriage too much. There is a path on his baby steps toward financial ruin by marrying a modern women and divorce grape.

I'll post some of these divorce train wreck calls when I get a chance. Absolute train wrecks.
 
You're not accounting for inflation. You can't retire on $50k/year now, let alone in 15+ years when it's worth even less. What about in 30+ years when you are just 65 and your $500k is still $500k, because you have been taking out your entire 10% return (if you get it) and not reinvesting at least part of it? It just don't work.
 
Milgrim said:
You're not accounting for inflation. You can't retire on $50k/year now, let alone in 15+ years when it's worth even less. What about in 30+ years when you are just 65 and your $500k is still $500k, because you have been taking out your entire 10% return (if you get it) and not reinvesting at least part of it? It just don't work.
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I could easily survive with 50/k a year with no house payment. If you're still paying off your house well you already fucked up. Plus you add in SS as well.
 
A mistake many people make us not contributing to their employees 401 or 457 retirement plans. Many companies will match a portion of your contribution. If you don't get their max contribution, you throwing away free money from your company that will go in your retirement plan.
 
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