Sunday, June 16, 2019
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How much should you have in your 401(k)?

Having a 401(k) account is one of the most powerful retirement assets one can have, but the reality is that most people are not saving enough in it. Far from it. In fact, Americans as a whole are in a lot of trouble. According to the Economic Policy Institute, almost half of us don’t have ANY retirement savings. Zero. Zip. Zilch. With pensions following the Dodo bird into extinction and the future of Social Security up in the air, having enough for the future rests more in our hands.

So how much should you have by the time you are 30, 40, or 50? We’re going to base our numbers on a few assumptions:

  • You started working full-time after college at 24 years old
  • Your family makes $61,372 a year – the median household income
  • You contributed $19,000 a year to your 401k – the maximum IRS limit
  • Your company matches the typical amount, which is around 3% of your contributions
  • The stock market returns an average of 7% a year

Here’s what that looks like by the time you’re 60:

Holy ninja warrior multi-millionaire! How does $19,000 a year come out to $4,806,643??? It’s a thing called compounding – let your money make you more money. You leave it alone on autopilot and let it do its job, all while you meditate in your dojo. It adds up, slowly at first, but over time it’s on money-making steroids. As you can see from the chart below, you’re only investing $875,329 over the entire 36 years. The rest of $4,806,643 is from stock market gains and the beauty of compounding:

Nice huh? The biggest obstacle most of us will face in life is how to manage money correctly. Psychologically, it’s hard for people to save for a future seemingly so far away when they can use that money for instant pleasure now. It’s nice to take a vacation to an exotic island or buy that car you’ve been drooling at forever. As a reader of The Money Ninja, I will teach you how to have the best of both worlds.

How are you compared to your age? Is it realistic or are your odds better of being struck by lightning twice?


So after many years of sitting on The Money Ninja domain and social media accounts, I have finally slashed away (ninja-style) the inertia and formally launch the blog! Although this is not the first blog I have ventured into, I am truly passionate and excited about this one!

Personal finance has always been an obsession of mine. I created my first company when I was still a teenager, traded my first stock as soon as I turned 18, and looked for ways to make and save money for as long as I can remember. Along the way, numerous friends and family have benefited from my advice, which was what spearheaded this idea for a blog in the first place.

Whether you are making $50,000 or $100,000 or $250,000 – join me as I dispense advice and strategies on how to maximize your finances. You will make more of it, save it better, and spend it in ways you wish you had ages ago!

In the meantime, feel free to email me with any suggestions for blog posts at

Let’s do it, ninja style!