In my last Blog about 'Developing a Savings Ethic', I encouraged one to start savings and investing in their 401K or IRA. Soon, that will become easier and more accessible for many working Americans.
The above link address is for the proposed Secure Act 2.0 white paper, Which, when passed, could provide up to a proposed $2000 per year in matching contributions to a workers 401K or retirement plan as an incentive to save in their plan. For most lower and Middle income workers this will be a HUGE incentive to begin saving and continue saving for a more profitable and secure retirement.
The Below picture shows that if one contributed $2000 every year end from age 25 to 65, age 20 to 60, or age 30 to 70, and received a $2000 matching contribution, received a moderate 5% annual compound return, the person would have over one half million dollars as a retirement savings income supplement. Continuing to receive 5% annually would result in $25,000.00 per year in income for life without ever spending the principal. That forever sum of money would leave a $500,000 legacy for whoever or whatever you choose.
The above is an example of what is probable. For what is possible... If the match were at 50% that would mean the savings contribution would have to be $4000 each year to get the $2000 match. The End Balance would be over $750,000. If the Rate of Return of the $4000 savings and $2000 match is increased to 6% compounded annually the End Balance would be almost $1 Million.
All the above is another example of starting a saving and investment plan. Continuing it for a lifetime is the combination to achieve financial success.
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