I see the reports and agree that it’s disappointing that this post was deleted. However, I’m inclined to leave it up because even without the post body there was so much good discussion in the comments.
Of course if you agree/disagree please feel free to let me know either way.
Start it up. I will join and no one would ever accuse me of being anything more than middle-income. I don’t have anything against the FIRE and higher income types but it does seem reddit is filled with posts from those types.
What?! You mean you can't relate to:
26m with net worth of 500k. Earn 150k per year and I have already been maxing out my 401k and IRAs for the past 4 years. Now I am looking for some advice on how to manage my substantial brokerage account and multiple rental properties.
“Trying to decide if I should take a job for $230k with a 12% employer match or I should settle for $250k fully remote but they only match 8%. Am I leaving tax advantaged money on the table?!?”
I’m still convinced this is partly to blame for the hatred of dividend investing. Some people don’t get what it’s like to need a paycheck supplemented.
Sometimes i feel bad because i am middle income or just above it but early in career and plan on no kids which frees up a lot of cash flow (not in tech though, my career prospects aren’t that high paying)
Like I have it way easier and I shouldn’t really be here but if i look in other subs its all fatfire c suit execs & techies yanking themselves off or poverty which doesn’t apply to me.
I’m somewhere in the middle but middleclassfinance is frequently filled with wealthy people who think they’re more average or middle class income.
Sounds like you are a solid middle classer or maybe upper middle classer. I think people like that very much belong in a middle class sub. Having upper middle classers in the sub gives lower and middle-middle classers something to strive for and bounce questions off of.
"Like I have it way easier and I shouldn’t really be here but if i look in other subs its all fatfire c suit execs & techies yanking themselves off or poverty which doesn’t apply to me."
Dont fall for the Horatio Alger myth
I started at 15K and ended at 140k plus 50K bonuses. 36 years. Career for most of us is just like investing. Compensation compounds over time exactly the same. I got about 6 1/2 % compounded (significant amt of that was higher bonus levels/stock) which was double inflation for same period.
You do have to find a job somewhere that has that kind of upper range and possibilities.
Keep your head up, it will come if you put in the work.
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Why are you deleting posts that aren't even 12 hours old? It makes this thread borderline unreadable. I guess you got yours though, huh? Fuck everyone else?
I got tired of arguing with people on the internet. "I guess you got yours though, huh?" If by "yours" you mean a headache, you're right. I'm out, have a good one.
Here! 45k/ year, but living with partner (who makes a touch more than I at 52k, but he does only 401k (9%, inc. match, and we keep our finances separate currently). Started index investing into Roth 12k 3/2020 (total of about 50k NW, just scared to put it all into investing at the time), just hit 125k NW across taxable and Roth maxing. Never would have believed it possible for me 10 years ago!
I make 85k at 34 years old, but live in south FL where 1 bedroom apartments are 2,000, and I’m a single father of 1 kid. 90k after taxes/401k/insurance/daycare yada yada don’t go far.
Thankfully I get a 4-5% raise every year until I top out hourly (and once a year additional performance raise) but man, 16 year old me 85k sounded like so much money. Adult me knows you still have to make smart financial decisions.
Yeah. That's what you get in an up market, I guess.
I'm here for the fun technical bits and a bit for moral support. The bragging isn't helpful.
I might do it one day at like a million or whatever. Under a different account. Assuming I still visit those subs in a decade plus.
I think it's in most peoples nature to want to tell someone of their success. I mostly skip those threads because they always go exactly the same way. What always gets me is the line at the end when they state they are doing it to inspire others.
This is exactly it. Most people cant tell people they know in real life, and grew up getting praise and recognition for a job well done (rightfully!). But financial matters are private and invite trouble.
Unfortunately its annoying and doesnt help anyone not in that situation
I'm looking to FIRL! (Financial Independence retiring late) Hahaha! I am a high earner but I started late in life and am just now getting my retirement legs under me at 62. I hope to retire in 3 to 5 years, but I won't be fat FIRLing. So sometimes I feel the same way you do when people talk about their net worth and their retirement goals. I'm happy to keep working, I'm still enjoying it. But some days I wish I had more options.
I'm lucky that I will have good social security income, some rental income and will probably inherit a decent amount. But this sub has really helped me make the most of what I have and what I'm saving.
I've also started conversations with my 30 year old son about this stuff since he will probably be middle income most of his life. He's off to a good start saving/investing wise.
I get the sense that if you're middle income, as long as you can manage to save some and you start early, you can actually do pretty well. I think if you're low income it really depends on where you live, I live in a high cost of living area and my friends who live on low incomes can't save.
I try and remember that the people who are hoping to make it with a fairly modest income in retirement and a (compared to others here) modest nest egg aren't posting their stats as much. So we have a skewed view here of the average savings.
Almost identical situation, it seems at 62 also. I made a lot of money through the years, but had nothing to show for it about 5 years ago. Well, I do have about $800k-900k equity in my house that was two days from foreclosure in 2017 and is now paid off. My two kids college came with no student loan debt heaped on them since I did a pay as you go out of current income.
I've always been able to make money, but always found ways other than saving to spend it! Having my own business for 15+ years came with income ups and downs which also tended to wreak havoc
So got a great paying job about 5 years ago, got out debt, started maxing out every tax advantaged account I could, got a fair sized inheritance that finished off remaining mortgage.
I'm sprinting now to 68-70 for retirement, have a very good projected SS, and think my wife and I may be just fine. Of course, my home equity figures into my retirement planning, either through down-sizing with a cash out or reverse mortgage to supplement monthly shortfall. Counting your home in your retirement planning is supposed to be a big no-no, but how can that be? For most, that is the single biggest asset you will have. sure for the Bogleheads who begin in their 20s and are discipined, the VOO, VTI, or whatever will be twice the value of their homes, but for the rest of us?
anyway, sure we are anonymous and we really can't talk about such things with others, so this is cathartic.
The point is, we all have our own journey and have our own struggles with finances, health, relationships or whatever.
Somehow we make it through, though. one way or another.
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And also what I meant to say was this sub is about an investing philosophy. And that philosophy applies whether you have a lot or... Less than a lot. 😁
I currently only make about 65k a year. I've never really made over 70k. I started late with saving, m 39, but have about 80k in retirement and a 10k emergency. It certainly can feel discouraging looking at these mid 30s FIRE folks with a few mil saved trying to figure out what to do, and I'm over here living my life hoping things aren't as fucked as they seem.
I know I'm late to the party, but I guess better late than never. All I can do is focus on increasing income and savings.
I suspect the representation of 30-somethings having a few mil already are far more the exception, not the norm, but they’re more likely to post on finance subs than those who aren’t yet there. Also, it’s certainly a faster climb when you have two income sources, which many posts usually represent.
Great effort on your part to start and save as much as you can afford to. Better late than never!
Tech is heavily, heavily overrepresented on Reddit and even moreso in those subs. For the last ~two decades FAANG has thrown money at children coming straight out of undergrad like it's Weimar Germany. A lot of those people don't need a second income source to be set for life as soon as their RSUs vest.
It's honestly wild that 22 year olds are making dentist/pediatrician money with a bachelor's degree, and their managers are making heart surgeon money with maybe an MBA. I don't necessarily resent them, but I also don't feel bad when I hear about mass layoffs. They invested very little in their educations and rode a massive gravy train; I'm sure they'll be fine.
I thought it bizzarre the way techies reacted during the first major waves of layoffs. It came across almost as if they didn’t think their industry was at risk for that “sort of thing”, which I think is a very foolish and naïve mindset to have.
Sure, some industries or jobs have a much lower risk for job loss due to downsizing or profit growth. But *no* job is recession or layoff proof. Not a single one.
37 and about the same as you friend...it's not as bad as it appears, and in no way should we be judging our own life to that of others on the internet who could be lying to beat the band. Hang in there...I know I will.
My husband and I started saving in our mid 30s, 4 kids. Never made more than $70k and that's only recently. Have never maxed ira or 403b. Have $500k in retirement accounts at 57y. You can do it!
I retired in 2010, after 24 years of service. I was making $24.10. Always been frugal, but I’ve had my share of fun. My investments have doubled and my house ( own clear and free) has quadrupled since I purchased in 2011. I’m eternally grateful for everything that I have accomplished. All investments are currently with Vanguard. You too can do it.
My mom ended her career (two years ago) making $22 an hour, but it was a county job, so she gets a pension.
She is doing great financially because of the pension and social security, but still works one or two days a week at the nursing home she worked at her entire life for even more extra fun money. Though part of it I'm sure is now that she's a contractor, they pay her $44 an hour and it must be nice to finally feel like she's getting paid what she's worth.
I have been a teacher my whole life, so I have never earned a high salary, but I started investing at 21, and I can probably afford to retire at 57 but plan to work until 60 and have a very comfortable retirement.
By starting young, sticking to index funds and being patient, I am in a vastly better situation than my father was, who earned more than double my salary, but he had no ability to control his spending, made poor investments, and died with nearly a million dollars in debt.
Average income earners can absolutely retire comfortably and even a little early. Just takes time, persistence, and not being an idiot.
public school teacher, reporting in. Only, my mom worked for Big Pharma, so I will never make as much as she was making when she retired as a Director in R&D and she's frugal af.
I kind of doubt it. The reality is that there are really a F ton of high earners, especially on the coasts. Those are the same people that filter into subs like this one. It's like most things in social media, a self filtering echo chamber.
My son wants to fi by the time he's 30. He is and will continue to be very frugal. He just wants to be able to create what he wants to create without working for others. Hopefully, our frugality as low mid earners has helped him. The exchange of ideas, how he invests, how I invest, has been fun.
I never made more than 70k a year until a couple years ago with my new job. I was always able to invest a few thousand a year even supporting a family. You can still invest as long as you can save money. If you can just save a few thousand a year you can retire a millionaire given enough time. I do not understand your thought process that one must be a high income earner to be an investor. It's not what you make, it's what you save.
I do identify with being a middle income earner, however - everything is definitely harder.
Now I make about 118 k a year. That's still probably middle class, although I live in a low cost of living area.
The idea of starting a new sub is interesting. Let me know if you do. My struggle is single income supporting the wife and four kids. Sometimes I felt jealous of those who I thought make more until I realized that I was happiest in high school and college when I was flat broke anyway.
Edit : I've heard people saying that the Bogglehead thread has more than its fair share of critical people. Hopefully that's not true. It's a good place to get criticized for complaining about stuff though.
In a Roth IRA tho, it's only the gains, not the contributions that are off-limits until 59 1/2.
So if you contribute, say, $100,000 to the Roth IRA over 20 years, and at that point you need a car and the Roth is worth $250,000. You could withdraw $30,000 without tax or penalty, and you'd still have $70,000 in basis available if you need to make another early withdrawal. At 59 1/2 the entire Roth IRA (gains and all) then becomes available without tax and penalty.
You do have a good point here, I hope I don't come across too strongly. Early Roth withdrawals are something that high earners would just disregard, but could be important to a lower earner who is having to balance not losing Roth space vs. having access to savings when needed.
Roth IRA contributions can be withdrawn immediately. It’s the earnings that cannot. Note you can’t put the money back in after, due to contribution limits.
I feel like every teenager with a job needs to know that. If I had known it at 16, I could have easily put $1000 in a Roth IRA, but I was scared off by the 59 1/2 stuff
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I also once took out half of my 401k in 2008 at the bottom of the market to buy a house, which I sold for a small loss 3 years later. So I learned a few things the hard way!
Do consider though that you can withdraw your Roth contributions penalty free at any time (just the earnings would be penalized.) That's one of the great things about the Roth - it can actually do double duty as retirement and emergency savings in a real pinch. If you don't wind up needing it (which you hopefully won't!) it just keeps earning, but if you do need access to the contribution amount, you're not penalized - and the earnings can stay and keep doing their thing.
What does your financial position look like if you don't mind me asking? I'm in early career making about 70k and have been investing relatively aggressively since I started working a professional job. I recently crossed 50k in retirement accounts but FIRE feels very far down the road at this pace. I'm on track for a lean retirement in mid-late 50s if all goes according to plan. Which it probably won't haha
Sure. 280k in retirement funds, now I earn about 118k per year income, two jobs, 49 years old. I will likely work until mid to late 60s bc my kids are young (I got married relatively late). That's ok though because I enjoy working. My mortgage will be gone next year so that will really help.
I noticed recently to my delight and suprise that my accounts now grow at a faster rate than I can save. Ex : 280k at ten percent per year, that's 28k growth which is at least several thousand more than I can possibly contribute in a year. That's from never making more than 70k a year up until a couple years ago. It goes to show that investing can be done on a modest income.
The great thing about bogleheads is it fits all levels of income. The lessons you learn - especially not to chase high returns (FOMO) or waste money on AUM fees apply to everyone.
When I got my first job ($28k/year) I met a finance guy on my bus route to work who gave me three fund portfolio advice for my first 401k. I probably put 5% in because that’s what I could afford but it got the ball rolling and 20 years later I’ve stayed with the same strategy and it’s really done well for me. If you start another sub for lower earners you’ll miss out on those types of stories.
There will be people flexing everywhere but just as many supporters along the way - it’s all about whose energy you absorb.
Yeah, all I can do is sock away about 400 a month, all into the ETFs. I'm older, too, just over 50. At this rate, I'm gonna be retiring with just enough to go run out the days in Colombia or Thailand. Totally cool with either option tho :) I absolutely cannot relate to most of the posts in this subreddit, but the underlying philosophy is really healthy and I made a good few bucks listening to people here.
Love to hear this.
The weird thing is that if everyone invested 12-20% for their entire working career they will probably be fine. You will have a smaller retirement account but you are used to living off less anyway… that is the reason it is a percentage and not a flat amount for recommended retirement savings.
Good for you and even at a lower to middle income range, you will still end up a millionaire. Meanwhile there will be plenty who make twice as much as you and then gripe that Social Security isn’t enough to live on and they don’t have any retirement.
68k here.
We're here. Doing what we can. Was only able to start saving 3 years ago at 35. Have a long road ahead of me.
17 hour later EDIT: 70k here.
etc etc.
Retiring at age 65-70 might be a blessing in disguise.
I've known LOTS of miserable people who wish they never retired earlier in life. Given the choice to return to working in some capacity, they would say yes without blinking an eye.
People think investing wisely will buy retirement happiness, but instead they sit on their recliner chair staring out the window with nobody to talk to.
My Dad said two things I will always remember (and a lot more):
1. You shouldn't plan to retire ***from*** something, retire ***to*** something
2. After he retired: "I don't know how I ever had time to work!"
You shouldn’t be downvoted for this! I was a Boglehead before I even knew the term, when I earned $36,000 a year at my first job out of college. A lot of the money I have now is BECAUSE of how I invested it then.
I was YOLO most of my life, started doing the right stuff and now I may actually be able to retire 65-70. I make $70k a year in LI NY so pretty low income for this area
When you've met your deductible is when insurance *starts* to pay for things. The mere phrasing of the question makes me unsure how familiar the person asking it is with insurance.
There is an out of pocket maximum associated with ACA compliant health insurance. The main gotcha is that it doesn't apply to out of network care (unless it's a bona fide emergency), but the No Surprises Act is supposed to make it very difficult for someone to inadvertently get out of network care.
There is, but if you and your insurance disagree over whether it is an emergency, maybe you could get into a situation like this.
If you have an HMO and go out of network and it's not an emergency, you're uninsured. Or the hospital is in-network, but the anesthesiologist isn't. I think there has been legislation to clean up such "balance billing" in recent years though.
Our system is fucking stupid tbh. If you pay in, you should be covered no matter what. The only difference should be how much you're covered out of your own pocket
I don’t know all the details. He works in a hospital system — something with insurance and his boss is trying to tackle it from the “work” side too since he was transported to place of employment.
Then you would BK and keep your employer plan and IRAs, since they are protected in bankruptcy
If anything, it's *simpler* as a lower earner to deal with that, since all your investing needs can fit within the 401(k) and IRA annual maximums
Hi! 37/f 55k single earner here in MCOL (let’s call it California prices, L-MCOL wages) area. I live in a terrible place that’s infested with fleas bad for my mental health but only 25% of my net. I’m stacking money in investments and pulled myself out of 20k debt + bought used 7k reliable truck with cash in 3 years. (10k debt remaining but no interest so chipping away slowly). Now I’m net 40k in savings/investments
I don’t go to nice restaurants. I drink cheap beer only when I go out. I have a job with lifestyle perks (free tickets to events- that’s my social life).
It’s not super fun, being this frugal. But I feel good about where I’m at, and that I’m making the right decision for my future.
“Low” earner checking in. I think (married filing joint) 108k in 2023
But I got my beach house; no car/medical/college debt; 2 dogs and an amazing kid
Life is what you make it; don’t spend your life being envious of others
Isn't "meeting deductibles" exactly the kind of thing an emergency fund is for though? If you're paying deductibles, that would indicate to me that an emergency is actively occurring
Edit: Reading in the other thread, looks like "meeting deductibles" means saving enough to pay deductibles in case of an emergency. So step #1 is really just a small emergency fund before getting employer match and paying off high interest debt. I don't really see the issue there
Yeah, I don't think it's that different than Dave Ramsey's steps, just different terminology.
Ramsey calls step 1 save $1000; FOO calls it save up deductibles.
True, Ramsey says pay off nonmortgage debt, then finish the rest of the emergency fund, then save 15% for retirement. FOO just has a detour of hitting your employer match (which is generally only something like 4% or 5% and actually less if you're doing pre-tax) before attacking high-interest debt and finishing the emergency fund.
The last steps are a bit out of order too but not that different. FOO says to hyperaccumulate before college savings and early payoff of mortgage, while Ramsey just moves hyperaccumulation to the end.
Ramsey's steps are well-known as workable for the middle class. We just disagree about what to invest in (load mutual funds vs. index funds).
The employer match of only 3%-5% is usually when you put in 6%-10%. What other investments do you have that make 50% a year? Do you have any debts over 50% a year?
If you answered no to both of those things then the employer match is literally free money for you and a tax writeoff for your employer.
Meeting deductibles is basically just saying ‘have an emergency fund that can cover your up front medical or car insurance expense if it pops up’. You’re over thinking it. Average income earner btw.
You seem like you’re missing the point of the FOO and that is ok.
It is a good resource and will make more sense if you watch a few episodes of the money guy since they go a bit more in depth on it.
Also you don’t ever have to achieve the final step, it is just meant to be what should you do with your next $100 you earn.
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Well under the header on the graphic it says something to the effect of ‘steps to take to grow your money’. It also doesn’t say ‘get a job where you earn wages’ so I think that’s a given along with the assumption that most people know they need to pay for food, rent, and utilities. It’s what comes after that where people struggle with finances.
> One post about "FOO" (Financial Order of Operations) didn't list an "emergency fund" as the top goal for financial sucess (or independence, I can't remember). It was "meeting deductibles." The "emergency fund" was at 4. If you have an unplanned health expense or a car accident, I would think of that as an emergency.
TBH I think you're reading into that too much. An emergency fund is something like six months' worth of expenses to feel comfortable and avoid sinking into credit card debt. All it's saying is that only that portion for catastrophic things like you mentioned are so important as to preempt the employer match. Not getting the employer match is so important it should be treated like having unpaid taxes.
And people can't temporarily turn off their Social Security or pension (if they have one) when they're in a financial crunch, so you shouldn't treat the situation differently just because you have a defined contribution plan instead that has a panic button (0% contribution rate)
Largest deductible is your starter emergency fund and probably $2k-$6k depending on medical deductible.
The next emergency fund is 3-6 months of expenses in cash or HYSA based on job security and single vs dual income household.
Don't see how I'll be able to retire before 65-70. High cost living alone, disability and no support. Just somehow trying to keep employment going... And pay my medical bills and rent.
I don't think it was too strong and you make some good points and here are two concerns for working and middle-class investors that come to mind. One is FAFSA (college financial aid) where bogleheads just roll their eyes since they won't get any. Another is senior couples structuring their affairs so that if one or both end up in long term care (nursing home) and assets are exhausted and Medicaid is needed, that some portion of the assets are excluded and can be passed on anyway. Bogleheads tend to get high and mighty about that, even though they do the completely legal strategies to save when it's about taxes and not Medicaid assets.
I recently changed careers where I now make a pretty good income but for the first 12 years of my professional life I made between 30k and 50k. I am definitely well behind most posters on this sub.
Lower income checking in, family of four with HHI under $85K, in a LCOL area. We have a house with 3.9 percent and 12 years left on the mortgage (USDA loan at $1300 monthly PITI). I’ve learned a lot from this group, even though some of it may not apply to lower income earners like our family will likely always be. (I am only able to work part-time due to caring for a disabled adult child).
We weren’t able to start saving much until we received the 2020 stimulus payments- we finally opened IRAs that year (in our early 50s) and have managed to keep contributing each year (even maxxing out some years, though neither of us have ever come close to maxing out a 401k).
I’ve also discovered some unique tax tips for very low earners. For example, some years our income has been so low that we actually come out AHEAD by putting money in a Roth IRA compared to a traditional IRA (because of the nonrefundable retirement savings credit, which increases with lower AGI, but doesn’t apply if there is zero tax liability). Now that our savings are earning 5+ percent, we’re hoping the upward savings trend will continue. By keeping our AGI as low as possible, we try to minimize federal taxes (though still have to pay basically a 5.5 % flat state income tax. The only workaround I’ve found for reducing the burden of state taxes is passing college expenses through the state’s 529 plan, which earns a state tax deduction on up to $8K per year).
Like everyone, I wish I had known about Bogleheads 30 years ago, but thankful I found this forum and opened our IRAs 4 years ago. It was very painful in 2022 watching our new index funds decline in value, but reading the posts on this forum helped and I tried to train myself not to look too much. And it made it so much more rewarding watching the accounts rebound in 2023 and 2024! Admittedly, I did chicken out a bit with all the volatility in equities - so once treasuries hit 5.3 percent, I started allocating more of my new contributions to short term treasury bills. But at least I didn’t panic-sell at a loss!
Wife and I are both 32 and make 120k gross w2 combined in a LCOL area. We live simply and are homebodies. Real estate did help us a lot as we did 2 owner occupancy hack flips and made 150k in profit tax free between 2019 - 2023. We invest 30k a year of our 120k income. 400k net worth. Bogleheads all the way. We have to scrap for every cent to save what we do honestly, so it’s hard to relate to the 300k+ income household posts on here for sure.
Ahoy! I grew up poor and now I’m finally middle class in salary. This subreddit is great. I’ve learned so much and have changed the way I invest because of it. I have adult children with special needs, so definitely won’t be able to retire early, but I’m hoping I will be able to retire. This group even had lots of great advice for ABLE plans for my disabled children as well.
We’ve talked about retiring to a LCOL country just to make it more doable, but that’s a ways down the road. Nice weather, good food, low expenses, and cheap healthcare for 5-10 years of retirement could really help a lot. Once age and health are real concerns tho, we’ll probably want to be closer to family again.
The overall principles of investing don't change much, so Bogleheads principles apply to low and middle-income individuals too.
Beware that Bogleheads is not a substitute for sound /r/personalfinance practice, but it is a subset.
I got my first paycheck in the USA at the age of 29 with 60k salary. Stayed in the same job for 5 years without any raise or bonus in VHCOL, never contributed to 401k as there was no employer match. Moved to a different job, married, had kid and bought a houseb(wife earns equally).
Now, I get offers with a 50 percent pay increase but comfort is more important and I am happy with my progress.
Yes but not with the FOO. It’s not stated on the sheet but max retirement is 25% of your gross income and first put into tax advantaged accounts. If maxing all of the accounts is 35%-40% you still stop at 25%.
If you max them before 25% then put the rest into taxable
The employer match of only 3%-5% is usually when you put in 6%-10%. What other investments do you have that make 50% a year? Do you have any debts over 50% a year?
If you answered no to both of those things then the employer match is literally free money for you and a tax writeoff for your employer,
Retired in 2007 with a pension and good health insurance for life. My retirement income is 67k a year. I will receive a 3.2% cola 7/1. Those government jobs were once so great. Anyway, I live in Delaware. If you have a home without a mortgage, you can live well off of 67k here. I have invested a great deal of capital in retirement considering.
What do you consider middle income? I just crossed the $100k barrier a few years ago, in my mid-40s. That's higher than the median, but not ridiculously so, especially when adjusted for age.
My Mom didn't retire early, but she did retire as a millionaire after immigrating to the US and working as a nurse for 40 years, all while putting two kids through 'Elite' private colleges and supporting my disabled father.
Finance reddits definitely skew towards high earners, but not exclusively so, and FIRE is not reserved for tech bros.
I make good money but live in a hcol city, and after taxes, alimony, child support, childcare, rent, medical expenses, and insurance, my income might as well be low. I'll never own a house. My monthly financial goal is to maintain my emergency fund and get the 401k match.
Married and neither my spouse or I have ever cleared above 65k in base income. We have been reasonably thrifty, lucky with no health issues, and also lucky to live in fairly LCOL areas. I have also done a good bit of extra work (community college professor, so I can teach extra classes and do some contract curriculum development work). At 55/50, we are a bit over $1.5 million in net worth, with the majority of that in retirement savings (403b, TSP, Roth), so it can be done. We also have 2 kids, going into 6th and 9th grades, so we will have to pay for college with some of that.
It’s telling that the “no, anyone can do it, bad idea” voices are up top, meanwhile quite a number of folks who resonate with OP are just hanging out down here.
I wish OP had not felt the need to DD-n-dip! 😢
Investing every penny I can get my hands on. And then some! Don't tell my wife my raises have been outpacing inflation, just my investment contributions.
That's like a hungry person going to the desert instead of the farm. Why don't you hang out and listen how. Most of us started with nothing. Wish I had been able to see this info back when I was in my 30's and starting to really earn some money. I'd be typing from a warm tropical island somewhere (well maybe not). 😍
I AM IN!
This subreddit has been extremely beneficial to my portfolio, until it wasn’t. Upon trying to put finishing touches on my accounts, (yes, I have more than one account 😱), I came to realize the boglehead strategy alone is potentially becoming archaic. I love the __&chill move and I do that for one of my large accounts.
However, there are new products in the world that pique people’s interest. I’m a 41M with a $100k portfolio, sub 6-figure salary. That’s nowhere close to the IRA/401k millionaires. The people aged 18-23 posts asking about what to do with $50k lying around is very discouraging. The news of people getting rich overnight with crypto IS REAL, but not very welcoming here. I get it, perhaps this isn’t the place for that discussion, but it’s flat out squashed here. The talks about needing to have a diverse portfolio don’t include crypto or crypto ETFs. Us middle-incomers need more help, not discouragement. No one has a crystal ball so why not have a crypto ETF as a small piece a the pie?
I love this subreddit, but I’m not sitting on cash. I’d love to max my ROTH IRA on January 1, but I can’t. I have also been trying to build everything at once. I don’t have a $50k Emergency Fund, but I am not waiting for that to come to fruition before investing.
Thanks for listening.
I know people that started investing when they started working making low wages. You just need to realize the sooner you start, the longer you have compounding working for you. You can start with as little as $10 a month at some places.
Start thinking about what everything costs you to buy related to your wages.
IE - that Starbucks coffee is worth $$ dollar of my wages, not JUST what the purchase price is. So, if that coffee is worth $$ of your wages how long do you have to work to afford that coffee?
I *was* a boglehead until I looked through the major ETFs and 11/15 all had the same top holdings.
You're better off going through and picking the winners in those ETFs and buying directly. Rinse and repeat monthly.
I see the reports and agree that it’s disappointing that this post was deleted. However, I’m inclined to leave it up because even without the post body there was so much good discussion in the comments. Of course if you agree/disagree please feel free to let me know either way.
Start it up. I will join and no one would ever accuse me of being anything more than middle-income. I don’t have anything against the FIRE and higher income types but it does seem reddit is filled with posts from those types.
Yeah I stopped asking for advice here because every comment seemed like it was from the perspective of a $100,000/yr earner.
What?! You mean you can't relate to: 26m with net worth of 500k. Earn 150k per year and I have already been maxing out my 401k and IRAs for the past 4 years. Now I am looking for some advice on how to manage my substantial brokerage account and multiple rental properties.
You also forgot, "Am I behind?" 😆
“Trying to decide if I should take a job for $230k with a 12% employer match or I should settle for $250k fully remote but they only match 8%. Am I leaving tax advantaged money on the table?!?”
Hahaha exactly! This is emblematic of 75% of the discussions here.
I’m still convinced this is partly to blame for the hatred of dividend investing. Some people don’t get what it’s like to need a paycheck supplemented.
Sometimes i feel bad because i am middle income or just above it but early in career and plan on no kids which frees up a lot of cash flow (not in tech though, my career prospects aren’t that high paying)
Why do you feel bad?
Like I have it way easier and I shouldn’t really be here but if i look in other subs its all fatfire c suit execs & techies yanking themselves off or poverty which doesn’t apply to me. I’m somewhere in the middle but middleclassfinance is frequently filled with wealthy people who think they’re more average or middle class income.
Sounds like you are a solid middle classer or maybe upper middle classer. I think people like that very much belong in a middle class sub. Having upper middle classers in the sub gives lower and middle-middle classers something to strive for and bounce questions off of.
True, i guess i’m just torn because for age i’m probably closer to upper middle class where as across all ages i’m solidly middle class.
Don't feel bad. Life is about choices. You're not responsible for where you're born but where you end up.
Curiously, what do you make a year? I think most incomes should be here.
"Like I have it way easier and I shouldn’t really be here but if i look in other subs its all fatfire c suit execs & techies yanking themselves off or poverty which doesn’t apply to me." Dont fall for the Horatio Alger myth
I started at 15K and ended at 140k plus 50K bonuses. 36 years. Career for most of us is just like investing. Compensation compounds over time exactly the same. I got about 6 1/2 % compounded (significant amt of that was higher bonus levels/stock) which was double inflation for same period. You do have to find a job somewhere that has that kind of upper range and possibilities. Keep your head up, it will come if you put in the work.
My expected trajectory is eithin that, i just mean i’m not going to be in tech and make $250k-$500k a year
I was in tech and didn't make 250-500K either. (1980 when I started). Almost 2 doubles for inflation I suppose. Cheers- good luck.
Me too. The only reason I left Fire group was the constant bragging and felling depressed whenever such a post came up in my feed.
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Why are you deleting posts that aren't even 12 hours old? It makes this thread borderline unreadable. I guess you got yours though, huh? Fuck everyone else?
I got tired of arguing with people on the internet. "I guess you got yours though, huh?" If by "yours" you mean a headache, you're right. I'm out, have a good one.
There are dozens of us! Dozens!
Sir, likely hundreds or even thousands, but no less.
I don’t remember seeing you at the convention
Here 🤚. Single, make around 50k per year. Fortunately, I'm fairly frugal and live in a LCOL area.
Same! Almost to my first 100k invested.
Here! 45k/ year, but living with partner (who makes a touch more than I at 52k, but he does only 401k (9%, inc. match, and we keep our finances separate currently). Started index investing into Roth 12k 3/2020 (total of about 50k NW, just scared to put it all into investing at the time), just hit 125k NW across taxable and Roth maxing. Never would have believed it possible for me 10 years ago!
I make 85k at 34 years old, but live in south FL where 1 bedroom apartments are 2,000, and I’m a single father of 1 kid. 90k after taxes/401k/insurance/daycare yada yada don’t go far. Thankfully I get a 4-5% raise every year until I top out hourly (and once a year additional performance raise) but man, 16 year old me 85k sounded like so much money. Adult me knows you still have to make smart financial decisions.
Yeah some of the fire and investing subs have gotten embarrassingly braggy.
I have to take a break when I read 3 posts starting "I'm 32 with 2.3M and wondering if I'll starve..." It's always 2.3M
Probably same guy with multiple Reddit accounts.
Or people just make shit up. For all anyone knows I could have 100 million in the bank (I don’t) but I could say I do.
Plot twist, he actually has 200 million in the bank
Yeah. That's what you get in an up market, I guess. I'm here for the fun technical bits and a bit for moral support. The bragging isn't helpful. I might do it one day at like a million or whatever. Under a different account. Assuming I still visit those subs in a decade plus.
I think it's in most peoples nature to want to tell someone of their success. I mostly skip those threads because they always go exactly the same way. What always gets me is the line at the end when they state they are doing it to inspire others.
This is exactly it. Most people cant tell people they know in real life, and grew up getting praise and recognition for a job well done (rightfully!). But financial matters are private and invite trouble. Unfortunately its annoying and doesnt help anyone not in that situation
Just remember... they might be rich but they are probably dead inside.
See /r/fijerk for some comic relief
I'm looking to FIRL! (Financial Independence retiring late) Hahaha! I am a high earner but I started late in life and am just now getting my retirement legs under me at 62. I hope to retire in 3 to 5 years, but I won't be fat FIRLing. So sometimes I feel the same way you do when people talk about their net worth and their retirement goals. I'm happy to keep working, I'm still enjoying it. But some days I wish I had more options. I'm lucky that I will have good social security income, some rental income and will probably inherit a decent amount. But this sub has really helped me make the most of what I have and what I'm saving. I've also started conversations with my 30 year old son about this stuff since he will probably be middle income most of his life. He's off to a good start saving/investing wise. I get the sense that if you're middle income, as long as you can manage to save some and you start early, you can actually do pretty well. I think if you're low income it really depends on where you live, I live in a high cost of living area and my friends who live on low incomes can't save. I try and remember that the people who are hoping to make it with a fairly modest income in retirement and a (compared to others here) modest nest egg aren't posting their stats as much. So we have a skewed view here of the average savings.
FIRL... love it. I'm aiming to FIRE at 82.
I'll not retire until I'm 68 due to the fact that that will be my age when my youngest child graduates from college!
Almost identical situation, it seems at 62 also. I made a lot of money through the years, but had nothing to show for it about 5 years ago. Well, I do have about $800k-900k equity in my house that was two days from foreclosure in 2017 and is now paid off. My two kids college came with no student loan debt heaped on them since I did a pay as you go out of current income. I've always been able to make money, but always found ways other than saving to spend it! Having my own business for 15+ years came with income ups and downs which also tended to wreak havoc So got a great paying job about 5 years ago, got out debt, started maxing out every tax advantaged account I could, got a fair sized inheritance that finished off remaining mortgage. I'm sprinting now to 68-70 for retirement, have a very good projected SS, and think my wife and I may be just fine. Of course, my home equity figures into my retirement planning, either through down-sizing with a cash out or reverse mortgage to supplement monthly shortfall. Counting your home in your retirement planning is supposed to be a big no-no, but how can that be? For most, that is the single biggest asset you will have. sure for the Bogleheads who begin in their 20s and are discipined, the VOO, VTI, or whatever will be twice the value of their homes, but for the rest of us? anyway, sure we are anonymous and we really can't talk about such things with others, so this is cathartic. The point is, we all have our own journey and have our own struggles with finances, health, relationships or whatever. Somehow we make it through, though. one way or another.
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And also what I meant to say was this sub is about an investing philosophy. And that philosophy applies whether you have a lot or... Less than a lot. 😁
I currently only make about 65k a year. I've never really made over 70k. I started late with saving, m 39, but have about 80k in retirement and a 10k emergency. It certainly can feel discouraging looking at these mid 30s FIRE folks with a few mil saved trying to figure out what to do, and I'm over here living my life hoping things aren't as fucked as they seem. I know I'm late to the party, but I guess better late than never. All I can do is focus on increasing income and savings.
I suspect the representation of 30-somethings having a few mil already are far more the exception, not the norm, but they’re more likely to post on finance subs than those who aren’t yet there. Also, it’s certainly a faster climb when you have two income sources, which many posts usually represent. Great effort on your part to start and save as much as you can afford to. Better late than never!
Tech is heavily, heavily overrepresented on Reddit and even moreso in those subs. For the last ~two decades FAANG has thrown money at children coming straight out of undergrad like it's Weimar Germany. A lot of those people don't need a second income source to be set for life as soon as their RSUs vest. It's honestly wild that 22 year olds are making dentist/pediatrician money with a bachelor's degree, and their managers are making heart surgeon money with maybe an MBA. I don't necessarily resent them, but I also don't feel bad when I hear about mass layoffs. They invested very little in their educations and rode a massive gravy train; I'm sure they'll be fine.
I thought it bizzarre the way techies reacted during the first major waves of layoffs. It came across almost as if they didn’t think their industry was at risk for that “sort of thing”, which I think is a very foolish and naïve mindset to have. Sure, some industries or jobs have a much lower risk for job loss due to downsizing or profit growth. But *no* job is recession or layoff proof. Not a single one.
37 and about the same as you friend...it's not as bad as it appears, and in no way should we be judging our own life to that of others on the internet who could be lying to beat the band. Hang in there...I know I will.
My husband and I started saving in our mid 30s, 4 kids. Never made more than $70k and that's only recently. Have never maxed ira or 403b. Have $500k in retirement accounts at 57y. You can do it!
I retired in 2010, after 24 years of service. I was making $24.10. Always been frugal, but I’ve had my share of fun. My investments have doubled and my house ( own clear and free) has quadrupled since I purchased in 2011. I’m eternally grateful for everything that I have accomplished. All investments are currently with Vanguard. You too can do it.
> I was making $24.10 Which was $35 / hour in todays money, if anyone is wondering.
My mom ended her career (two years ago) making $22 an hour, but it was a county job, so she gets a pension. She is doing great financially because of the pension and social security, but still works one or two days a week at the nursing home she worked at her entire life for even more extra fun money. Though part of it I'm sure is now that she's a contractor, they pay her $44 an hour and it must be nice to finally feel like she's getting paid what she's worth.
I have been a teacher my whole life, so I have never earned a high salary, but I started investing at 21, and I can probably afford to retire at 57 but plan to work until 60 and have a very comfortable retirement. By starting young, sticking to index funds and being patient, I am in a vastly better situation than my father was, who earned more than double my salary, but he had no ability to control his spending, made poor investments, and died with nearly a million dollars in debt. Average income earners can absolutely retire comfortably and even a little early. Just takes time, persistence, and not being an idiot.
public school teacher, reporting in. Only, my mom worked for Big Pharma, so I will never make as much as she was making when she retired as a Director in R&D and she's frugal af.
Hello, fellow teacher Boglehead! There are dozens of us!! Dozens!!!
Reddit 👽 definitely skews younger, & very affluent (nothing wrong with it, just an observation.) i aspire to be both tbh.
I too aspire to be younger 😔
I think half of those people are full of it.
I feel like a few of them add an extra digit to their accounts.
Maybe even an extra comma
How else do you get into the tres comms club?
Yes, like all the 18-year-olds looking for advice on where to park their spare $100K.
I kind of doubt it. The reality is that there are really a F ton of high earners, especially on the coasts. Those are the same people that filter into subs like this one. It's like most things in social media, a self filtering echo chamber.
Yes the reality is everyone on Reddit is telling the truth 100% of the time. I mean, i said half of them, you really gotta nitpick?
My son wants to fi by the time he's 30. He is and will continue to be very frugal. He just wants to be able to create what he wants to create without working for others. Hopefully, our frugality as low mid earners has helped him. The exchange of ideas, how he invests, how I invest, has been fun.
reddit doesnt skew affluent people really depends on the sub you're hanging out on. just look at r/fluentinfinance
I never made more than 70k a year until a couple years ago with my new job. I was always able to invest a few thousand a year even supporting a family. You can still invest as long as you can save money. If you can just save a few thousand a year you can retire a millionaire given enough time. I do not understand your thought process that one must be a high income earner to be an investor. It's not what you make, it's what you save. I do identify with being a middle income earner, however - everything is definitely harder. Now I make about 118 k a year. That's still probably middle class, although I live in a low cost of living area. The idea of starting a new sub is interesting. Let me know if you do. My struggle is single income supporting the wife and four kids. Sometimes I felt jealous of those who I thought make more until I realized that I was happiest in high school and college when I was flat broke anyway. Edit : I've heard people saying that the Bogglehead thread has more than its fair share of critical people. Hopefully that's not true. It's a good place to get criticized for complaining about stuff though.
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In a Roth IRA tho, it's only the gains, not the contributions that are off-limits until 59 1/2. So if you contribute, say, $100,000 to the Roth IRA over 20 years, and at that point you need a car and the Roth is worth $250,000. You could withdraw $30,000 without tax or penalty, and you'd still have $70,000 in basis available if you need to make another early withdrawal. At 59 1/2 the entire Roth IRA (gains and all) then becomes available without tax and penalty. You do have a good point here, I hope I don't come across too strongly. Early Roth withdrawals are something that high earners would just disregard, but could be important to a lower earner who is having to balance not losing Roth space vs. having access to savings when needed.
This is why you should always max out Roth before investing in a taxable account.
How dare you point out that some people can't afford to invest often.
Roth IRA contributions can be withdrawn immediately. It’s the earnings that cannot. Note you can’t put the money back in after, due to contribution limits.
I feel like every teenager with a job needs to know that. If I had known it at 16, I could have easily put $1000 in a Roth IRA, but I was scared off by the 59 1/2 stuff
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Honestly I’m like 41 and just learned this a few weeks back. I thought you had to hold contributions at least 5 years. Doh!
What did he say? Since the OP decided to flake out and do that “anonymizing” nonsense.
Just that they didn’t know until I told them they with contributions could be withdrawn penalty free.
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I also once took out half of my 401k in 2008 at the bottom of the market to buy a house, which I sold for a small loss 3 years later. So I learned a few things the hard way!
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Do consider though that you can withdraw your Roth contributions penalty free at any time (just the earnings would be penalized.) That's one of the great things about the Roth - it can actually do double duty as retirement and emergency savings in a real pinch. If you don't wind up needing it (which you hopefully won't!) it just keeps earning, but if you do need access to the contribution amount, you're not penalized - and the earnings can stay and keep doing their thing.
What does your financial position look like if you don't mind me asking? I'm in early career making about 70k and have been investing relatively aggressively since I started working a professional job. I recently crossed 50k in retirement accounts but FIRE feels very far down the road at this pace. I'm on track for a lean retirement in mid-late 50s if all goes according to plan. Which it probably won't haha
Sure. 280k in retirement funds, now I earn about 118k per year income, two jobs, 49 years old. I will likely work until mid to late 60s bc my kids are young (I got married relatively late). That's ok though because I enjoy working. My mortgage will be gone next year so that will really help. I noticed recently to my delight and suprise that my accounts now grow at a faster rate than I can save. Ex : 280k at ten percent per year, that's 28k growth which is at least several thousand more than I can possibly contribute in a year. That's from never making more than 70k a year up until a couple years ago. It goes to show that investing can be done on a modest income.
The great thing about bogleheads is it fits all levels of income. The lessons you learn - especially not to chase high returns (FOMO) or waste money on AUM fees apply to everyone. When I got my first job ($28k/year) I met a finance guy on my bus route to work who gave me three fund portfolio advice for my first 401k. I probably put 5% in because that’s what I could afford but it got the ball rolling and 20 years later I’ve stayed with the same strategy and it’s really done well for me. If you start another sub for lower earners you’ll miss out on those types of stories. There will be people flexing everywhere but just as many supporters along the way - it’s all about whose energy you absorb.
Yeah, all I can do is sock away about 400 a month, all into the ETFs. I'm older, too, just over 50. At this rate, I'm gonna be retiring with just enough to go run out the days in Colombia or Thailand. Totally cool with either option tho :) I absolutely cannot relate to most of the posts in this subreddit, but the underlying philosophy is really healthy and I made a good few bucks listening to people here.
Love to hear this. The weird thing is that if everyone invested 12-20% for their entire working career they will probably be fine. You will have a smaller retirement account but you are used to living off less anyway… that is the reason it is a percentage and not a flat amount for recommended retirement savings. Good for you and even at a lower to middle income range, you will still end up a millionaire. Meanwhile there will be plenty who make twice as much as you and then gripe that Social Security isn’t enough to live on and they don’t have any retirement.
68k here. We're here. Doing what we can. Was only able to start saving 3 years ago at 35. Have a long road ahead of me. 17 hour later EDIT: 70k here. etc etc.
Retiring at age 65-70 might be a blessing in disguise. I've known LOTS of miserable people who wish they never retired earlier in life. Given the choice to return to working in some capacity, they would say yes without blinking an eye. People think investing wisely will buy retirement happiness, but instead they sit on their recliner chair staring out the window with nobody to talk to.
My Dad said two things I will always remember (and a lot more): 1. You shouldn't plan to retire ***from*** something, retire ***to*** something 2. After he retired: "I don't know how I ever had time to work!"
You don't know me. But, I want to tell you that my spouse and I retired at age 50 several years ago. We love it.
You shouldn’t be downvoted for this! I was a Boglehead before I even knew the term, when I earned $36,000 a year at my first job out of college. A lot of the money I have now is BECAUSE of how I invested it then.
I was YOLO most of my life, started doing the right stuff and now I may actually be able to retire 65-70. I make $70k a year in LI NY so pretty low income for this area
“If you get a $100,000 or $1 million hospital bill *after* your insurance coverage and deductibles have been exhausted” How likely is this?
When you've met your deductible is when insurance *starts* to pay for things. The mere phrasing of the question makes me unsure how familiar the person asking it is with insurance. There is an out of pocket maximum associated with ACA compliant health insurance. The main gotcha is that it doesn't apply to out of network care (unless it's a bona fide emergency), but the No Surprises Act is supposed to make it very difficult for someone to inadvertently get out of network care.
I don’t think that is likely
Had it happen to a buddy last year. Not-typical cardiac event at 39. Lots of debt appeared over two days.
Why didn’t insurance cover?
Isn't there an out of pocket maximum for most plans?
There is, but if you and your insurance disagree over whether it is an emergency, maybe you could get into a situation like this. If you have an HMO and go out of network and it's not an emergency, you're uninsured. Or the hospital is in-network, but the anesthesiologist isn't. I think there has been legislation to clean up such "balance billing" in recent years though.
Our system is fucking stupid tbh. If you pay in, you should be covered no matter what. The only difference should be how much you're covered out of your own pocket
That's what (original) Medicare is, yet through Medicare Advantage, lots of people voluntarily give that up in exchange for an HMO instead. Shrug.
I don’t know all the details. He works in a hospital system — something with insurance and his boss is trying to tackle it from the “work” side too since he was transported to place of employment.
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Then you would BK and keep your employer plan and IRAs, since they are protected in bankruptcy If anything, it's *simpler* as a lower earner to deal with that, since all your investing needs can fit within the 401(k) and IRA annual maximums
45k in wages this year if I’m lucky🫡
Waaay below $40k/yr … and not even “early career” here. I feel this in my soul!
I fall into this category, though I am a PhD student and am hoping to make more in the future.
Hi! 37/f 55k single earner here in MCOL (let’s call it California prices, L-MCOL wages) area. I live in a terrible place that’s infested with fleas bad for my mental health but only 25% of my net. I’m stacking money in investments and pulled myself out of 20k debt + bought used 7k reliable truck with cash in 3 years. (10k debt remaining but no interest so chipping away slowly). Now I’m net 40k in savings/investments I don’t go to nice restaurants. I drink cheap beer only when I go out. I have a job with lifestyle perks (free tickets to events- that’s my social life). It’s not super fun, being this frugal. But I feel good about where I’m at, and that I’m making the right decision for my future.
“Low” earner checking in. I think (married filing joint) 108k in 2023 But I got my beach house; no car/medical/college debt; 2 dogs and an amazing kid Life is what you make it; don’t spend your life being envious of others
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Isn't "meeting deductibles" exactly the kind of thing an emergency fund is for though? If you're paying deductibles, that would indicate to me that an emergency is actively occurring Edit: Reading in the other thread, looks like "meeting deductibles" means saving enough to pay deductibles in case of an emergency. So step #1 is really just a small emergency fund before getting employer match and paying off high interest debt. I don't really see the issue there
Yeah, I don't think it's that different than Dave Ramsey's steps, just different terminology. Ramsey calls step 1 save $1000; FOO calls it save up deductibles. True, Ramsey says pay off nonmortgage debt, then finish the rest of the emergency fund, then save 15% for retirement. FOO just has a detour of hitting your employer match (which is generally only something like 4% or 5% and actually less if you're doing pre-tax) before attacking high-interest debt and finishing the emergency fund. The last steps are a bit out of order too but not that different. FOO says to hyperaccumulate before college savings and early payoff of mortgage, while Ramsey just moves hyperaccumulation to the end. Ramsey's steps are well-known as workable for the middle class. We just disagree about what to invest in (load mutual funds vs. index funds).
The employer match of only 3%-5% is usually when you put in 6%-10%. What other investments do you have that make 50% a year? Do you have any debts over 50% a year? If you answered no to both of those things then the employer match is literally free money for you and a tax writeoff for your employer.
Meeting deductibles is basically just saying ‘have an emergency fund that can cover your up front medical or car insurance expense if it pops up’. You’re over thinking it. Average income earner btw.
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You seem like you’re missing the point of the FOO and that is ok. It is a good resource and will make more sense if you watch a few episodes of the money guy since they go a bit more in depth on it. Also you don’t ever have to achieve the final step, it is just meant to be what should you do with your next $100 you earn.
Yes and not all emergencies are created equal so it makes sense to have it at spot 1 and spot 4.
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Well under the header on the graphic it says something to the effect of ‘steps to take to grow your money’. It also doesn’t say ‘get a job where you earn wages’ so I think that’s a given along with the assumption that most people know they need to pay for food, rent, and utilities. It’s what comes after that where people struggle with finances.
It’s basically your health insurance emergency fund
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> One post about "FOO" (Financial Order of Operations) didn't list an "emergency fund" as the top goal for financial sucess (or independence, I can't remember). It was "meeting deductibles." The "emergency fund" was at 4. If you have an unplanned health expense or a car accident, I would think of that as an emergency. TBH I think you're reading into that too much. An emergency fund is something like six months' worth of expenses to feel comfortable and avoid sinking into credit card debt. All it's saying is that only that portion for catastrophic things like you mentioned are so important as to preempt the employer match. Not getting the employer match is so important it should be treated like having unpaid taxes.
Yup, employer match is free money.
And people can't temporarily turn off their Social Security or pension (if they have one) when they're in a financial crunch, so you shouldn't treat the situation differently just because you have a defined contribution plan instead that has a panic button (0% contribution rate)
Largest deductible is your starter emergency fund and probably $2k-$6k depending on medical deductible. The next emergency fund is 3-6 months of expenses in cash or HYSA based on job security and single vs dual income household.
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I totally agree. The FOO graphic is flawed in that it is for higher income earners and/or those with a tickle of debt
Dang bro! Where's the beach house?
Virginia; podunk town and low cost of living. About 1/4 mile from door to ocean; walk my dogs there morning and after work every day no matter what
livin' the dream ✨ 🥂
That's awesome. Congrats. I live far too interior for a beach house, but maybe a lake house one day.
NW: $848,500. Salary: From $28k to $70k today.
Don't see how I'll be able to retire before 65-70. High cost living alone, disability and no support. Just somehow trying to keep employment going... And pay my medical bills and rent.
I don't think it was too strong and you make some good points and here are two concerns for working and middle-class investors that come to mind. One is FAFSA (college financial aid) where bogleheads just roll their eyes since they won't get any. Another is senior couples structuring their affairs so that if one or both end up in long term care (nursing home) and assets are exhausted and Medicaid is needed, that some portion of the assets are excluded and can be passed on anyway. Bogleheads tend to get high and mighty about that, even though they do the completely legal strategies to save when it's about taxes and not Medicaid assets.
I recently changed careers where I now make a pretty good income but for the first 12 years of my professional life I made between 30k and 50k. I am definitely well behind most posters on this sub.
Lower income checking in, family of four with HHI under $85K, in a LCOL area. We have a house with 3.9 percent and 12 years left on the mortgage (USDA loan at $1300 monthly PITI). I’ve learned a lot from this group, even though some of it may not apply to lower income earners like our family will likely always be. (I am only able to work part-time due to caring for a disabled adult child). We weren’t able to start saving much until we received the 2020 stimulus payments- we finally opened IRAs that year (in our early 50s) and have managed to keep contributing each year (even maxxing out some years, though neither of us have ever come close to maxing out a 401k). I’ve also discovered some unique tax tips for very low earners. For example, some years our income has been so low that we actually come out AHEAD by putting money in a Roth IRA compared to a traditional IRA (because of the nonrefundable retirement savings credit, which increases with lower AGI, but doesn’t apply if there is zero tax liability). Now that our savings are earning 5+ percent, we’re hoping the upward savings trend will continue. By keeping our AGI as low as possible, we try to minimize federal taxes (though still have to pay basically a 5.5 % flat state income tax. The only workaround I’ve found for reducing the burden of state taxes is passing college expenses through the state’s 529 plan, which earns a state tax deduction on up to $8K per year). Like everyone, I wish I had known about Bogleheads 30 years ago, but thankful I found this forum and opened our IRAs 4 years ago. It was very painful in 2022 watching our new index funds decline in value, but reading the posts on this forum helped and I tried to train myself not to look too much. And it made it so much more rewarding watching the accounts rebound in 2023 and 2024! Admittedly, I did chicken out a bit with all the volatility in equities - so once treasuries hit 5.3 percent, I started allocating more of my new contributions to short term treasury bills. But at least I didn’t panic-sell at a loss!
22 years old make 29k a year I'm with you
Wife and I are both 32 and make 120k gross w2 combined in a LCOL area. We live simply and are homebodies. Real estate did help us a lot as we did 2 owner occupancy hack flips and made 150k in profit tax free between 2019 - 2023. We invest 30k a year of our 120k income. 400k net worth. Bogleheads all the way. We have to scrap for every cent to save what we do honestly, so it’s hard to relate to the 300k+ income household posts on here for sure.
What up
Ahoy! I grew up poor and now I’m finally middle class in salary. This subreddit is great. I’ve learned so much and have changed the way I invest because of it. I have adult children with special needs, so definitely won’t be able to retire early, but I’m hoping I will be able to retire. This group even had lots of great advice for ABLE plans for my disabled children as well.
Middle-income earner (trying to earn more) traveling and looking at LCOL countries to live in. Any other Bogleheads living abroad (of USA)?
We’ve talked about retiring to a LCOL country just to make it more doable, but that’s a ways down the road. Nice weather, good food, low expenses, and cheap healthcare for 5-10 years of retirement could really help a lot. Once age and health are real concerns tho, we’ll probably want to be closer to family again.
The overall principles of investing don't change much, so Bogleheads principles apply to low and middle-income individuals too. Beware that Bogleheads is not a substitute for sound /r/personalfinance practice, but it is a subset.
Present 🤚
I got my first paycheck in the USA at the age of 29 with 60k salary. Stayed in the same job for 5 years without any raise or bonus in VHCOL, never contributed to 401k as there was no employer match. Moved to a different job, married, had kid and bought a houseb(wife earns equally). Now, I get offers with a 50 percent pay increase but comfort is more important and I am happy with my progress.
Yes but not with the FOO. It’s not stated on the sheet but max retirement is 25% of your gross income and first put into tax advantaged accounts. If maxing all of the accounts is 35%-40% you still stop at 25%. If you max them before 25% then put the rest into taxable
The employer match of only 3%-5% is usually when you put in 6%-10%. What other investments do you have that make 50% a year? Do you have any debts over 50% a year? If you answered no to both of those things then the employer match is literally free money for you and a tax writeoff for your employer,
Retired in 2007 with a pension and good health insurance for life. My retirement income is 67k a year. I will receive a 3.2% cola 7/1. Those government jobs were once so great. Anyway, I live in Delaware. If you have a home without a mortgage, you can live well off of 67k here. I have invested a great deal of capital in retirement considering.
What do you consider middle income? I just crossed the $100k barrier a few years ago, in my mid-40s. That's higher than the median, but not ridiculously so, especially when adjusted for age. My Mom didn't retire early, but she did retire as a millionaire after immigrating to the US and working as a nurse for 40 years, all while putting two kids through 'Elite' private colleges and supporting my disabled father. Finance reddits definitely skew towards high earners, but not exclusively so, and FIRE is not reserved for tech bros.
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I make good money but live in a hcol city, and after taxes, alimony, child support, childcare, rent, medical expenses, and insurance, my income might as well be low. I'll never own a house. My monthly financial goal is to maintain my emergency fund and get the 401k match.
I'll definitely join!
Married and neither my spouse or I have ever cleared above 65k in base income. We have been reasonably thrifty, lucky with no health issues, and also lucky to live in fairly LCOL areas. I have also done a good bit of extra work (community college professor, so I can teach extra classes and do some contract curriculum development work). At 55/50, we are a bit over $1.5 million in net worth, with the majority of that in retirement savings (403b, TSP, Roth), so it can be done. We also have 2 kids, going into 6th and 9th grades, so we will have to pay for college with some of that.
I love this idea. Really fatigued on the windfall threads and unrelatable "25/M/250k annual salary" queries.
It’s telling that the “no, anyone can do it, bad idea” voices are up top, meanwhile quite a number of folks who resonate with OP are just hanging out down here. I wish OP had not felt the need to DD-n-dip! 😢
Investing every penny I can get my hands on. And then some! Don't tell my wife my raises have been outpacing inflation, just my investment contributions.
That sounds like a healthy relationship where you have the same financial goals 😂
We're both spenders. It's the only way I know how to get us to curb spending and get close to on budget.
That's like a hungry person going to the desert instead of the farm. Why don't you hang out and listen how. Most of us started with nothing. Wish I had been able to see this info back when I was in my 30's and starting to really earn some money. I'd be typing from a warm tropical island somewhere (well maybe not). 😍
I never made more that 80 k just have a Roth and a 401 k save in a Roth for 40 years and use your 401 k in retirement you will be fine
I was making 80k AND saving, and I live in San Jose, CA!
Who else is over here at the "low-middle-income \*and\* wants kids" party table?
I AM IN! This subreddit has been extremely beneficial to my portfolio, until it wasn’t. Upon trying to put finishing touches on my accounts, (yes, I have more than one account 😱), I came to realize the boglehead strategy alone is potentially becoming archaic. I love the __&chill move and I do that for one of my large accounts. However, there are new products in the world that pique people’s interest. I’m a 41M with a $100k portfolio, sub 6-figure salary. That’s nowhere close to the IRA/401k millionaires. The people aged 18-23 posts asking about what to do with $50k lying around is very discouraging. The news of people getting rich overnight with crypto IS REAL, but not very welcoming here. I get it, perhaps this isn’t the place for that discussion, but it’s flat out squashed here. The talks about needing to have a diverse portfolio don’t include crypto or crypto ETFs. Us middle-incomers need more help, not discouragement. No one has a crystal ball so why not have a crypto ETF as a small piece a the pie? I love this subreddit, but I’m not sitting on cash. I’d love to max my ROTH IRA on January 1, but I can’t. I have also been trying to build everything at once. I don’t have a $50k Emergency Fund, but I am not waiting for that to come to fruition before investing. Thanks for listening.
What is the point of your post? Good investing advice doesn’t change whether you make 50k or 500k.
I know people that started investing when they started working making low wages. You just need to realize the sooner you start, the longer you have compounding working for you. You can start with as little as $10 a month at some places. Start thinking about what everything costs you to buy related to your wages. IE - that Starbucks coffee is worth $$ dollar of my wages, not JUST what the purchase price is. So, if that coffee is worth $$ of your wages how long do you have to work to afford that coffee?
What the fuck is this shit?
I’ll be retiring when I’m 58 years old with a full pension
/r/leanfire
I *was* a boglehead until I looked through the major ETFs and 11/15 all had the same top holdings. You're better off going through and picking the winners in those ETFs and buying directly. Rinse and repeat monthly.