"The poster used an online retirement calculator, which told them they'd be looking at a balance that large if they keep up their current 10% to 12% savings rate and continue to generate strong returns. They're happy with the numbers they're seeing on screen, but they want to know how accurate they are. (Generic calculators often assume constant returns and contributions, which rarely happen exactly that way.)"
"At age 29, your 401(k) balance may not be all that impressive. That's because most people have only been working for a short amount of time by that point. And also, a lot of people in their 20s can't max out a 401(k) because they're not earning all that much and have student debt and other bills to pay."
Many 29-year-olds have modest 401(k) balances because they have shorter work histories, lower early-career pay, student debt, and other bills that limit contributions. Sustained funding and prudent investing allow compound returns to grow retirement savings substantially over decades. A scenario with $45,000 saved and a 10%–12% savings rate can project to multi-million-dollar balances using online calculators. Generic retirement calculators often assume constant returns and contributions, making projections optimistic. Achieving multi-million-dollar retirement assets is possible but depends on long-term savings discipline, investment performance, and the erosive effects of inflation over time.
Read at 24/7 Wall St.
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