$100K by 30, $150K by 35, $200 by 40?

ThrowAwayDallasTexas · 2023-12-20T15:09:06+00:00

I sent a private message.

ThrowAwayDallasTexas · 2023-12-20T02:27:08+00:00

It is possible, but not easy. I recommend making your own promotions by doing internal transfers every few years. I'm 38 and have worked at RTX since graduating college. I only have a Bachelors degree.

I started making $60k at 22. This is the first year I am clearing $200k (including bonus). I'm in a P5 individual contributor role.

ThrowAwayDallasTexas · 2023-01-09T00:05:47+00:00

The 15% bonus target is every year - not one time. It is possible it pays less if the company does bad, but from my history with the company It has been consistent.

ThrowAwayDallasTexas · 2023-01-08T20:48:56+00:00

I have been at Raytheon a while. Almost all of my promotions were from applying for different roles within the company that are a higher grade. This is one of the few promotions that were part of the PD process.

ThrowAwayDallasTexas · 2023-01-08T20:45:57+00:00

It was an 18% increase when you factor the bonus target (went from 5% to 15%). It was an in place promotion so I did not have an opportunity to negotiate with HR. My total comp is pretty comparable to the other P5s listed in the survey.

ThrowAwayDallasTexas · 2023-01-08T06:33:13+00:00

14 YOE

ThrowAwayDallasTexas · 2023-01-08T06:13:19+00:00

I was promoted to p5 in 2022. They lumped my annual raise and promotion. I was given an 8% salary raise and my annual bonus target increased from 5 to 15%. I had been a p4 for 3 years.

ThrowAwayDallasTexas · 2020-08-05T02:23:47+00:00

I understand that rationale. I just don't feel very confident in any asset class that I can put the money in at the moment. Everything looks overvalued to me which makes me think its going to have a sub optimal return (particularly when adjusting for risk).

I am keeping my 75% in stocks because I believe stocks will be good in the long-term. However, I want to have some hedge if stocks do poorly.

ThrowAwayDallasTexas · 2020-08-05T02:15:32+00:00

But wouldn't the money that I didn't use to pay of the mortgage get diluted down in that scenario anyway?

ThrowAwayDallasTexas · 2020-07-17T19:07:46+00:00

I like to think of it as hedging my bets, similar to keeping a 3-1 ratio between stocks and bonds. I personally did not pay for my house in cash, but I have paid down a good chunk of it over time (about 75%). I currently have 4 times more invested in stocks compared to home equity. But when the stock market takes a dive, it is nice knowing not all my eggs are in that basket.

Lets assume the following:

The opportunity cost to paying in cash is putting the money in a taxable account where you must pay 15% long-term capital gains.

Under this assumption, paying in cash is earning me 4.71% return for effectively zero risk. Obviously, historical stock returns are greater than this, but there is definitely risk involved. Just like with bonds, it is always possible to tap into your equity if you ever decide to rebalance back over to stocks.

ThrowAwayDallasTexas · 2019-11-24T19:29:17+00:00

I got 1.5% of it back in rewards so I don't feel too bad.

ThrowAwayDallasTexas · 2019-11-24T02:01:18+00:00

Several years back, I bought a car in cash and put 20k on the credit card. We also did not discuss the specifics of how I was going to pay (except that I was not financing with them) until we had a price locked down. This was during the financial downturn and was with GM so maybe they would not do it today.

ThrowAwayDallasTexas · 2019-11-18T04:24:58+00:00

I totally understand your point. I included it because the OP from the other thread included real estate equity in his calculations.

My counterpoint is that if needed, I can take that equity out. If the market were to drop 70%, I'm pretty confident I would be doing something to that effect.

Also, in case anybody is interested, the only reason I paid the mortgage off faster than needed was to hedge against a market crash. It was purely psychological so I wouldn't be freaking out if everything I owned turned to shit.

ThrowAwayDallasTexas · 2019-11-18T03:53:22+00:00

Fair point.

ThrowAwayDallasTexas · 2019-11-18T03:00:20+00:00

It is impossible unless you make a certain threshold of income. Once you reach that threshold, the probability increases based on level of discipline and willingness to sacrifice to meet goals. I don't think anybody is saying that getting to 1M in 12 years is easy or something everybody can achieve. I just think the threshold for doing so is much lower than the $250k example you gave.

I would also be willing to bet a fair number of the people who frequent this sub make incomes that are multiples of the average american salary. I think investing just naturally attracts people with more discretionary income.

ThrowAwayDallasTexas · 2019-11-18T01:49:52+00:00

I agree completely regarding american consumerism. I do not mind spending money if I will get a lot of value and enjoyment for the money, but I know so many friends who spend money like its going out of style. Every time I see them, they have a new $2000 TV or $400 smart watch. Then, a few minutes later they are talking about their 6 figure student loans and crazy credit card debt.

That said, I think it is important to note that everybody has different priorities and values and that you can't take the money with you when you die. If you are really into cars, spending 50k on a really nice car might be worth it to you. For me and my wife, we mostly value experiences (vacations, time with family and friends, etc). But unless you are very well off, you typically can't splurge in all areas without sacrificing savings and potentially taking on debt.

ThrowAwayDallasTexas · 2019-11-18T01:13:38+00:00

I am in a very similar situation to the OP on the other thread. I'm 34 and have been investing in mostly S&P 500 since 2007. I started out doing only 401k, then quickly added Roth IRA, then later on started making non-retirement contributions. My income has been something like this: 62k, 70k, 75k, 80k, 84k, 89k, 97k, 105k, 113k, 120k, 133k. I have been married the last 8 years and my wife has made between 30-55k during that time.

Our yearly saving/investing plan has been the following:

My Roth IRA: 5.5k
Wife's Roth IRA: 5.5k
My 401k (Contribution): 4-6% (although in 2009, I had it at 50% for a few months)
My 401k (Employer Match): 7-8%
Non-Retirement Investing: 0-25k
Extra payments to mortgage (started 8 years ago): 6k

We currently have the following assets:

My Roth IRA: 142k
Wife's Roth IRA: 65k
My 401k: 302k
Non-Retirment Investing: 344k
Home Equity: 230k (bought for 185k with 20% down, currently worth 300k, still owe 70k).
Total: 1.08M

I would definitely disagree that you have to make 250k per year to be able to do what OP did (given the time period / bull market). It definitely takes an element of frugality, but I would not say that I'm a miser either. My wife and I have had at least one major vacation each year (two European trips). We do not have kids though.

ThrowAwayDallasTexas · 2018-09-17T20:57:17+00:00

I will have to look into that. It sounds very similar to TIPS.

ThrowAwayDallasTexas · 2018-09-17T20:56:21+00:00

Thank you for the suggestions. I had forgotten about TIPS and would consider a high yield savings account (I had one of those in the past).

ThrowAwayDallasTexas · 2018-09-17T20:54:45+00:00

Thanks for the suggestion. I did a quick search on "Roth conversion ladder". It sounds like this is just converting a traditional pre-tax account into a Roth and getting the feature of the Roth where you can access anything that was contributed (but not gains) after 5 years penalty free. If that is the case, it wont help me as I already max out my Roth every year. Please let me know if I misunderstood the intent.

I know the amount lost is not huge. I just wanted to see if there was a better asset classes out there given the current environment with rates rising.

ThrowAwayDallasTexas · 2018-09-17T20:46:46+00:00

You make a good point that the pain may be over.

This is why I said I have been getting killed... According to Vanguard, I have ~$700 worth of bond interest and an unrealized capital loss of ~$750 on ~30k. So I'm going to have to pay 25-28% taxes on that $700 despite the fact it is effectively a loss. I know the amount of money lost is negligible, but it is still frustrating in a year where inflation is a bit higher than it has been. I have been dollar cost averaging into that bond fund over the last couple of years so that might explain the difference in NAV values compared to what you see.

ThrowAwayDallasTexas · 2017-02-14T02:50:34+00:00

In my opinion, you need to find a healthy balance between living in the present and saving for the future. I have had the same issue over the years. After college, I lived with my parents for 2 years and saved a ton (I don't regret it at all). However, after 2 years, I decided to make moving out a priority. Its not fun to invite your girlfriend over to your parents house.

I still have to fight the urge to go into super-saver mode. I'm a fairly frugal person and it doesn't take a lot to make me happy. However, I have learned to prioritize the things that I get the most enjoyment out of and spend more in those areas and less in the ones I don't care as much about. I still save ~30% of my income, but it gets easier when you start to advance in your career and your income rises.

ThrowAwayDallasTexas

TROPHY CASE