Do you feel less willing to contribute as retirement accounts get larger?

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Caduceus
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Do you feel less willing to contribute as retirement accounts get larger?

Post by Caduceus »

I'm curious, especially for the folks with millions in their retirement accounts but also for those with less, if you just feel less willing to contribute after some point. After all, the daily or weekly fluctuation in your portfolio far exceeds whatever you are going to contribute.

Does it just feel pointless to contribute at that point, psychologically? Or do you still feel ultra-motivated?
manatee2005
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by manatee2005 »

Caduceus wrote: Sun Feb 02, 2020 1:54 am I'm curious, especially for the folks with millions in their retirement accounts but also for those with less, if you just feel less willing to contribute after some point. After all, the daily or weekly fluctuation in your portfolio far exceeds whatever you are going to contribute.

Does it just feel pointless to contribute at that point, psychologically? Or do you still feel ultra-motivated?
The higher the account the more motivated I am to contribute and make it larger. 401k max contributions with after tax is 56k, that's still nothing to sneeze at.
PDX_Traveler
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by PDX_Traveler »

Caduceus wrote: Sun Feb 02, 2020 1:54 am I'm curious, especially for the folks with millions in their retirement accounts but also for those with less, if you just feel less willing to contribute after some point. After all, the daily or weekly fluctuation in your portfolio far exceeds whatever you are going to contribute.

Does it just feel pointless to contribute at that point, psychologically? Or do you still feel ultra-motivated?
Let's say your annual needs in retirement income are $100K, and you can put away $50-60K per annum for retirement savings, I look at it as still an additional year funded for approximately every additional couple of years worked, regardless of the size of the portfolio...
Of course, this is a matter of individual psychology and all that, I think ... Savers will find ways to save, spenders will find ways to spend
lexor
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by lexor »

Caduceus wrote: Sun Feb 02, 2020 1:54 am I'm curious, especially for the folks with millions in their retirement accounts but also for those with less, if you just feel less willing to contribute after some point. After all, the daily or weekly fluctuation in your portfolio far exceeds whatever you are going to contribute.

Does it just feel pointless to contribute at that point, psychologically? Or do you still feel ultra-motivated?
I have 800k. Very motivated I'd like to see 1 million before the next downturn
“The miracle of compounding returns is overwhelmed by the tyranny of compounding costs.” -Mr. John C. Bogle
elvisimprsntr
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by elvisimprsntr »

Caduceus wrote: Sun Feb 02, 2020 1:54 am
I have seen the cost of LTC first hand with my parents. Fortunately, parents pension+SS covers 90% of it.

My motivation is the cost of LTC in declining years and how I plan to fund it.
  • House paid off and/or downsize before retirement
  • Live within my means off pension and taxable accounts
  • Hopefully move all $ into a Roth+HSA
  • Proceeds from house for LTC costs
  • Delay SS to help with LTC costs
Last edited by elvisimprsntr on Sun Feb 02, 2020 3:27 am, edited 1 time in total.
Gryphon
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by Gryphon »

I retired 3 years ago, and kept contributing as much as I could right up til the end. I never felt less willing to contribute. The bulk of my retirement savings was in my 401K and I only checked its balance quarterly, so I was blissfully unaware of the size of the day-to-day fluctuations.
texasdiver
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by texasdiver »

It's not so much an issue of willingness. But now that we are significantly passed the $1 million mark we are much more comfortable taking the foot off the gas to do things like pay for college tuition for our kids. We stopped making voluntary contributions this past year to pay full freight out-of-state tuition for the oldest child and the retirement accounts still went up by 7-times the max we could have contributed. Of course they will probably go down the same amount this year, who knows. And the employer is still making substantial contributions anyway so it's not like we are not saving anything.
StealthRabbit
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by StealthRabbit »

If no longer contributing to retirement? What's next?

Sure there are other ways to build your wealth. Pursue what best suits your needs and horizon.

While eligible (earned income) it is a good idea to max any defered options if able. Once retired... Or ineligible to contribute, your options decrease and needs for cash flow increase. You could be stuck! Negative cash flows has a predictable outcome.

I found it exciting when my retirement account gains exceeded my wage income (that was not hard to do). That was about 30 yrs ago. I'm not age 65 yet. Been retired from wage income / retirement savings >15 yrs. I still find ways to create enough 'earned income' to qualify for an IRA. Opportunity comes once / yr, then the door closes.
LFS1234
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by LFS1234 »

Caduceus wrote: Sun Feb 02, 2020 1:54 am I'm curious, especially for the folks with millions in their retirement accounts but also for those with less, if you just feel less willing to contribute after some point. After all, the daily or weekly fluctuation in your portfolio far exceeds whatever you are going to contribute.

Does it just feel pointless to contribute at that point, psychologically? Or do you still feel ultra-motivated?
I stopped contributing to tax-deferred (retirement) accounts when their combined balance was a bit over a million dollars, none of which was in Roth accounts and all of which would be subject to RMDs at age 70.5 (now 72). I was just under 50 at the time, and figured normal long-term stock appreciation should approximately triple the value of these tax-deferred assets in the subsequent 20 years, thereby creating an ample retirement account "bucket" but also an approximately $90k/year RMD "problem" in the first year of required RMDs. My tax-deferred accounts have almost always been practically 100% in stocks. After stopping the tax-deferred contributions, I have been re-routing any extra cash to "taxable" accounts instead.

Prior to stopping tax-deferred contributions, I had stashed away everything I could into retirement accounts. Being self-employed and writing my own paychecks, this often entailed paying myself more than necessary and incurring extra payroll taxes in order to maximize retirement contributions. So stopping all tax-deferred contributions was a complete about-face for me; but doing so made sense for me at the time and I don't think I'd do anything differently if I could re-visit that decision. What I might (or might not) have done differently, had I known more, was to look into options for converting some of those funds into a Roth account.

I've always been of the view that anything can happen in life and that there are no guarantees, including in matters related to taxation and what types of assets or accounts might be targeted by politicians in tax policy shifts. Consequently, I would not have been comfortable having everything in retirement accounts and nothing in ordinary "taxable" accounts, nor would I have been comfortable with the opposite.

To your point, since a well-invested equities account over a long period of time can be expected to increase by inflation plus 5% - 6% per year, it is true that a $5K annual contribution seems like a drop in the bucket in comparison once the account is large. However, for those who always have had the habit of living below their means, I don't think this usually changes. And living below your means requires a lot less sacrifice when you've got a lot, than when you're just starting out and have very little.
winterfan
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by winterfan »

Our retirement accounts have surpassed our wildest expectations. The amount our net worth increased last year was almost 10 fold what we put in. It's crazy. I do think it's important to contribute to our Roths though. We have cut back a bit on my husband's 401K contributions in lieu of those (we cannot max out everything this year).
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Johnsson
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by Johnsson »

No. I like simple questions!!
'In theory there is no difference between theory and practice. In practice there is.' Yogi Berra
retire57
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by retire57 »

We are in our 60s and have met our financial goals. Though we have enough, I still contribute to my Roth from my part-time wages, well-aware that when I retire, I lose the ability to do so. Setting up automatic contributions takes the emotions out of it.
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TomatoTomahto
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by TomatoTomahto »

We did switch to Roth 401k rather than traditional, so in a way, we increased our retirement savings.
Okay, I get it; I won't be political or controversial. The Earth is flat.
arsenalfan
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by arsenalfan »

Nope.
Make hay while the sun shines.
I do empathize though. >1% swing in SP500 equals my annual contribution.
Admiral
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by Admiral »

We've cut back a bit, and switched our contribs to Roth (employer still pre-tax).

But (and this is a big but) that's because we have a vested pension that begins at my age 58 (spouse 60) and it will be enough to basically cover our primary expenses (food, shelter, taxes, utils). Without that, no, I would not have cut back. And mind you the "cuts" are from saving 48k 100% pretax to 35k 1/3 pre-tax 2/3 Roth, so it somewhat evens out.
theplayer11
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by theplayer11 »

self employed, 55 years old, plan to retire in 4 years. We are maxing all possible tax advantaged accounts and will continue to do so.
smitcat
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by smitcat »

No difference in our savings plan over a very long time.
MathWizard
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by MathWizard »

No.

I would like to be able to contribute more.
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TomatoTomahto
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by TomatoTomahto »

MathWizard wrote: Sun Feb 02, 2020 9:01 am No.
I would like to be able to contribute more.
Yeah. Sure wish my wife’s employer had mega option for 401k.
Okay, I get it; I won't be political or controversial. The Earth is flat.
Soon2BXProgrammer
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by Soon2BXProgrammer »

Caduceus wrote: Sun Feb 02, 2020 1:54 am I'm curious, especially for the folks with millions in their retirement accounts but also for those with less, if you just feel less willing to contribute after some point. After all, the daily or weekly fluctuation in your portfolio far exceeds whatever you are going to contribute.

Does it just feel pointless to contribute at that point, psychologically? Or do you still feel ultra-motivated?
I ignore my balance. I focus on what can i save in a year in comparison to what I can spend in a year.

in my "one more year" of work, I'll have put more into my 401k and deferred comp plan then I spend in a year. So regardless of what the market does, in my mind, i went from 25x to 26x AND I went from needing 65 years of withdrawals to 64. -- Both sides of this i look at as risk reduction.
Dottie57
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by Dottie57 »

manatee2005 wrote: Sun Feb 02, 2020 1:56 am
Caduceus wrote: Sun Feb 02, 2020 1:54 am I'm curious, especially for the folks with millions in their retirement accounts but also for those with less, if you just feel less willing to contribute after some point. After all, the daily or weekly fluctuation in your portfolio far exceeds whatever you are going to contribute.

Does it just feel pointless to contribute at that point, psychologically? Or do you still feel ultra-motivated?
The higher the account the more motivated I am to contribute and make it larger. 401k max contributions with after tax is 56k, that's still nothing to sneeze at.
+1. I was motivated to save - like a runner heading for the finish line. Was also satisfied with standard of living so raises went to savings. My 401k didn’t allow for after tax contributions :( .

P.S. i do want to tell all the young people who are in their 20’s and have 401ks : you are lucky to be able to save! Many, many employers did not have 401k. I did not have 401k available until I was 30. Save early and often. Good luck.
Last edited by Dottie57 on Sun Feb 02, 2020 9:34 am, edited 1 time in total.
WarAdmiral
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by WarAdmiral »

A 50% decline in SP500 when you have $800k in your account feels very different than a 50% decline when you have $2.5 Million.

Stay the course!
SGM
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by SGM »

I was always willing to contribute to retirement accounts regardless of size. When my tax deferred accounts were large and when the laws changed in 2010 allowing Roth conversions I began to convert. I have never been eligible for a direct Roth purchase. As I was converting I continued to fund my solo 401k to the fullest. I knew my taxes would still be high in retirement so I wanted as much put into deferred accounts and eventually converted all to Roth accounts. I no longer own tax deferred accounts only taxable and Roth accounts. Currently I only spend from my taxable accounts and my other income streams in retirement. There may be a time when I will spend from a Roth account to avoid taking too many capital gains from my taxable account. Mostly I can spend from dividends in the taxable accounts. Delayed SS, pensions and rental income as they supply most of our spending needs.
nix4me
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by nix4me »

I feel the opposite. I'm saving more and more. I max 401k and Roth already so now i'm pouring all the excess into Taxable and House. I am worried about the tax bomb in 401k but so far i haven't made any changes other than shift 2% from traditional to Roth 401k. Part of me wants to drop my 401k contribution to the match and pour the rest into my taxable but the other part of me doesn't want to pay those taxes now - so i'm staying the course i guess.
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Sandtrap
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by Sandtrap »

Caduceus wrote: Sun Feb 02, 2020 1:54 am I'm curious, especially for the folks with millions in their retirement accounts but also for those with less, if you just feel less willing to contribute after some point. After all, the daily or weekly fluctuation in your portfolio far exceeds whatever you are going to contribute.

Does it just feel pointless to contribute at that point, psychologically? Or do you still feel ultra-motivated?
On the contrary, seeing success, one should be even more motivated to pursue a long range goal.
But, it also depends if one is the type to be satisfied with "enough" or "substantial wealth, etc".
Some "raise the bar", others do not.

j :happy
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Wiggums
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by Wiggums »

Caduceus wrote: Sun Feb 02, 2020 1:54 am I'm curious, especially for the folks with millions in their retirement accounts but also for those with less, if you just feel less willing to contribute after some point. After all, the daily or weekly fluctuation in your portfolio far exceeds whatever you are going to contribute.

Does it just feel pointless to contribute at that point, psychologically? Or do you still feel ultra-motivated?
I retired two years ago and I’m still in the game! Why stop investing after 32 years? Full steam ahead. I’m hoping that I have at least another 32 years on earth!!! You mentioned market fluctuations. Don’t you like to buy cheaper shares while in the accumulation phase? If you are investing in low cost, index funds, let it ride...
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Kenkat
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by Kenkat »

I am not. First off, I still want to get my 401(k) match; secondly, the future is unknown, I am satisfied with my current lifestyle and spending, so what else would I do with the money? I’ve grown up saving my entire life, why change now?

I do have the feeling that “the die has been cast”. I can’t materially affect my retirement savings by putting more money in. That opportunity is past. I am fortunate that I saved and invested in my 20s, 30s and 40s and can say that.
MathIsMyWayr
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by MathIsMyWayr »

Max all three automatically:
  • 401(K) with match and mega Roth
    403(b) with match
    457(b)
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watchnerd
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by watchnerd »

Caduceus wrote: Sun Feb 02, 2020 1:54 am I'm curious, especially for the folks with millions in their retirement accounts but also for those with less, if you just feel less willing to contribute after some point. After all, the daily or weekly fluctuation in your portfolio far exceeds whatever you are going to contribute.

Does it just feel pointless to contribute at that point, psychologically? Or do you still feel ultra-motivated?
No.

I turn 50 this year, so ramping up retirement savings to get those extra 'over 50 catch up' contributions I've been envious of before.

That being said, our taxable investment savings every year are about 5x-6x our 'retirement account' savings.
70% Global Market Weight Equities | 15% Long Treasuries 15% short TIPS & cash || RSU + ESPP
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teen persuasion
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by teen persuasion »

Dottie57 wrote: Sun Feb 02, 2020 9:26 am
Caduceus wrote: Sun Feb 02, 2020 1:54 am I'm curious, especially for the folks with millions in their retirement accounts but also for those with less, if you just feel less willing to contribute after some point. After all, the daily or weekly fluctuation in your portfolio far exceeds whatever you are going to contribute.

Does it just feel pointless to contribute at that point, psychologically? Or do you still feel ultra-motivated?

P.S. i do want to tell all the young people who are in their 20’s and have 401ks : you are lucky to be able to save! Many, many employers did not have 401k. I did not have 401k available until I was 30. Save early and often. Good luck.
Yes! I just got access to a SIMPLE IRA thru my employer of 10 years, at the age of 52. Prior to this, we've put the majority of our retirement savings in DH's 401k or equivalent, had no other choice (we do have Roth IRAs in each of our names). It puts us at a tax disadvantage, due to a state tax break on retirement income - the state exempts the first $20k in IRA withdrawals per person per year. It's not combinable, so with everything in DH's name, we get only $20k state tax free space per year, but if we both have pre-tax accounts we get $40k state tax free space per year.

So despite being close to reaching our number, I'm motivated to stuff as much in my SIMPLE IRA as possible. We've shifted some contributions away from DH's 403b to max my SIMPLE, but the total is still higher than before.

DH is again getting a bit burnt out at work, and looking to quit soon. I'm still having fun at my part-time job, it's just the need to be there nearly every day that interferes with a desire to go visit our new grandchild. So I'm running scenarios of me continuing to work, putting as much as possible into my SIMPLE while maxing EITC and converting some of DH's pre-tax to Roth while also keeping us eligible for auto EFC for DS5's upcoming FAFSA years. It's a tight rope to walk, but I like the challenge of making it work. Once FAFSA years are behind us, and no dependents for EITC, etc., it's much cleaner to just quit and convert to the standard deduction each year.
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TomatoTomahto
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by TomatoTomahto »

WarAdmiral wrote: Sun Feb 02, 2020 9:32 am A 50% decline in SP500 when you have $800k in your account feels very different than a 50% decline when you have $2.5 Million.
Perhaps you think it’s obvious, but how do the feelings differ?
Okay, I get it; I won't be political or controversial. The Earth is flat.
KlangFool
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by KlangFool »

OP,

1) No.

2) I have plenty of money for discretionary spending even with my usual saving rate. And, with my kids leaving the nest, the amount available for discretionary is just going to increase.

KlangFool
monkeytypist
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by monkeytypist »

"Willing" is not the right word but I know what you mean. I'm no where near millions yet, but already it can be demoralizing to add to the portfolio yet to see the total amount decrease due to daily market fluctuations. I try to tell myself this just means I'm on track, because someday I will depend on the sum of these daily fluctuations to fund my lifestyle. Also, to not check the portfolio everyday :happy
vipertom1970
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by vipertom1970 »

OP,
are you talking about continuing to contribute to retirement accounts or to continue to invest ? I retired at 50 with a NW of 92X my yearly expenses but I still continue to invest but take little less risk.
quantAndHold
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by quantAndHold »

Once our accounts got to that point, we just retired.
Yes, I’m really that pedantic.
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yangtui
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by yangtui »

No.

I pay myself first. Always have always will. Living within my means with a fixed savings rate is extremely satisfying. I feel accomplished. Having said this, if I hit a certain number I would probably retire and change my lifestyle up completely. My goal would not be to increase my net-worth but to maintain it and maximize the enjoyment I get out of life.
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beyou
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by beyou »

No, why would you stop ?

Note if you are 55+ and retire or laid off, you have penalty free access to your 401k balance (at least at then current employer so consolidate).


The only reason would be if you are sure tax rates will rise significantly. If you are in the highest tax brackets due to earned income now, even if tax rates rise later, without your earned income in retirement, you may well offset increased rates with a lower bracket. So why pay taxes now if you don’t have to ?

If you are sacrificing by keeping an unsafe car, or have unexpected large medical bills, sure, do what you have to do instead of savings of any kind. But if you are going to save, why not reduce taxes now ?
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RootSki
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by RootSki »

No way. I’ve been investing for 20 years and I have another 20 years of working and investing ahead of me. We are fortunate enough to be able to max out everything and my wife’s 401k is just starting after-tax contributions this year. She may only have a few years of work left so we’ll start doing that while we can.

I am feeling like we should be protecting or preserving some of our savings so I’ve rebalanced from 100/0 to 95/5 with the goal of being around 80/20 in the next few years.
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by sailaway »

beyou wrote: Sun Feb 02, 2020 12:27 pm No, why would you stop ?

Note if you are 55+ and retire or laid off, you have penalty free access to your 401k balance (at least at then current employer so consolidate).
You MAY have access to your 401k - this is one of those things that the IRS allows, but not all plans do.

By the time someone has accumulated so much that their contributions seem paltry, they have likely largely automated their savings, so psychology just keeps them working with that momentum. You may have options, but choosing to keep the same job, but just stop saving and start spending it all is likely to lead to a lifestyle that suddenly cannot be supported on the accumulated savings.

We have reached a stage where we are less likely to jump through hoops for relatively small sums. DH can't be bothered to roll his tIRA into his 401k to open up the backdoor Roth. That savings goes to a taxable account, instead, so we are still saving, just not making an extra effort.
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by PaulW »

Although I am retired I still have a part time job. For the past 10 years I have found great pleasure in contributing 100% of my wages to our Roth accounts, even though that contribution increases our Vanguard accounts less than .5% in any year.

PaulW
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Watty
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by Watty »

Caduceus wrote: Sun Feb 02, 2020 1:54 am Does it just feel pointless to contribute at that point, psychologically?
Not anywhere near millions in my retirement accounts but for me a big mental milestone was when I realized that if I was laid off then I would be OK if never worked again. "OK" at first would have been a very frugal modest retirement which is not how I would have want to retire but it would not be a dire situation if I never worked again.

At that point I ended up cutting my 401k contributions back to be just enough get my employers match. That was 6% to get a 3% match so it was still a non-trivial amount. I then started spending more on things like travel while we were still in good enough health to enjoy it.

You mentioned future savings contributions and investment returns but there is a third very important factor to also consider. That is the number of years that you will need to support yourself in retirement.

The way that I looked at my situation was that I would be in pretty good shape after I turned 65 and started Medicare and Social Security so when I was still working the number of years until I turned 65 was a very important number. I focused on that as much as my retirement contributions and investment return.

Every extra year I worked made a huge difference in my numbers.

I hit my "I'll be OK" number sometime in my early 50's and I finally retired just before I turned 59 so I would only have about 6 years until I could get on Medicare. (I will likely not start Social Security until later though.)
Last edited by Watty on Sun Feb 02, 2020 1:28 pm, edited 1 time in total.
Socal77
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by Socal77 »

Yes because my conservative forecasted retirement income is a sufficient floor for my desired lifestyle with zero future contributions.
manatee2005
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by manatee2005 »

Dottie57 wrote: Sun Feb 02, 2020 9:26 am
manatee2005 wrote: Sun Feb 02, 2020 1:56 am
Caduceus wrote: Sun Feb 02, 2020 1:54 am I'm curious, especially for the folks with millions in their retirement accounts but also for those with less, if you just feel less willing to contribute after some point. After all, the daily or weekly fluctuation in your portfolio far exceeds whatever you are going to contribute.

Does it just feel pointless to contribute at that point, psychologically? Or do you still feel ultra-motivated?
The higher the account the more motivated I am to contribute and make it larger. 401k max contributions with after tax is 56k, that's still nothing to sneeze at.
+1. I was motivated to save - like a runner heading for the finish line. Was also satisfied with standard of living so raises went to savings. My 401k didn’t allow for after tax contributions :( .

P.S. i do want to tell all the young people who are in their 20’s and have 401ks : you are lucky to be able to save! Many, many employers did not have 401k. I did not have 401k available until I was 30. Save early and often. Good luck.
My work had a 401k when I was 23 but it didn’t match for the first year. That put me off from savings in the first year.
retire2022
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by retire2022 »

op

I'm 59.5 at 1.76-1.8 million portfolio and will retire this year, I am planning to max out this years 457 (19,500+7000 Roth 457+Roth IRA) before I exit. I have 500K in Roth and have 14.5% in VGT.

I started young 1987 stock market crash and willing to play the gamble for more.
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goodenyou
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by goodenyou »

My wife and I are both still working and we contribute the maximum to our retirement accounts. I own my own business and she works for a mega international corp with a generous 401k match. We are both over 50, so our combined contribution to our retirement accounts are over $100k per year. It is our best (probable) tax-savings strategy. Who knows what the rates will be in the future.
Our taxable:tax-privileged accounts are about 75:25. So, lately we have been contributing less to taxable savings and have been spending more freely over the past few years. If the market tanks, we will cut back our spending.
Last edited by goodenyou on Sun Feb 02, 2020 4:00 pm, edited 1 time in total.
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Jags4186
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by Jags4186 »

The larger it gets the more motivated I am to contribute.

I am 100% full aboard the saving train until I no longer need to save.
Small Savanna
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by Small Savanna »

Actually, we are maxing out our accounts as we get closer to retirement. It's easier to afford once the kids are out of college. Plus, the alternative would be more take-home pay, which might lead to lifestyle creep.
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ruralavalon
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by ruralavalon »

Caduceus wrote: Sun Feb 02, 2020 1:54 am I'm curious, especially for the folks with millions in their retirement accounts but also for those with less, if you just feel less willing to contribute after some point. After all, the daily or weekly fluctuation in your portfolio far exceeds whatever you are going to contribute.

Does it just feel pointless to contribute at that point, psychologically? Or do you still feel ultra-motivated?
No, I did not feel less willing to contribute. With the children out of college and the mortgage note paid off, my contributions increased.
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123
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by 123 »

Of course the problem with (non-Roth) "retirement accounts" is the forced RMDs down the road and the taxation of distributions at the ordinary income rates.

Very large retirement accounts are a potential problem area for us as well. After we max our Roth 401K and Roth IRA optons (including backdoor) our taxable investment accounts become additional retirement accounts. Due to the absence of RMD requirements and the benefits of LTCG taxation plain old taxable investing looks pretty attractive.
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Phineas J. Whoopee
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Re: Do you feel less willing to contribute as retirement accounts get larger?

Post by Phineas J. Whoopee »

No. I feel more and more excited, as I see my decades-long financial plan coming to fruition.

I disagree with an upthread poster who says poor, poor multimillionaires have it worse when stock markets decline than rich, rich submillionaires.

Perhaps the poor, poor multimillionaire could spend some of their millions of dollars learning remedial arithmetic.

PJW
Last edited by Phineas J. Whoopee on Sun Feb 02, 2020 5:06 pm, edited 1 time in total.
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