Summary of what topics are covered:
During the year, I will post my monthly 401K balance so we can see how it has grown.
Here is Jan 2025 with Jan 2024 data:
Here is one from Oct 2024, so you can see how it has grown in one year (2024 YTD):
This 401K was around $20K when I started to post my 401K balance each month. It has grown from that to over 149K in a few years. The other thing is I mostly saved between 5K-7K a year in my 401K, a range that is doable by most people.
I know people who make twice as much as me and barely save 10K a year for retirement.
I want to show that regular folks with an "average" salary can do this.
My 401K can be $130K or it could be worth over $170K. Much of it depends on the market condition during the year. Since my crystal ball is broken right now, the best I can do is model what the range might be 11 months from now:
Start: 143K
New Cash: 8K
Sub Total: 151K
Market Adjustment: -20K to +20K
Total Range at the end of 2025: $131K to $171K
Do I wish for Up or Down Markets?
If you assume markets will always go up, you're mistaken. While up markets are favorable in the short term, you actually make money during down markets by "buying low."
As you approach retirement, you want the markets to move upward.
So, if you're under 60, you should hope for down markets because you're buying stocks with every paycheck through your 401K/403B plan. Historically, the market has risen more than half the time. It might sound odd, but the best way to build wealth is to have more down periods while you're buying and adding to your portfolio. This generally occurs between the ages of 25 and 60.
Before retirement, you want the markets to rise so that the value of your portfolio is higher when you need it.
In the meantime, you should Dollar Cost Average and consistently buy assets. This strategy has worked in the stock market and will work for Bitcoin as well. By buying $25 or $50 each month and not worrying about the current market price, it should work out over time.
Kid #2 made a move today by purchasing $60 worth of IBIT (or 1 share). I've been trying to convince them that buying Bitcoin and investing in QQQM isn't risky if they have a long-term view. They don't need to rely on dividends to grow their portfolio; instead, they should focus on high-growth businesses and assets with the potential to outperform the markets.
Join me in 2025 as we embark on this journey together. It will be a bumpy ride through the market cycles, but I'll enjoy the dips and buy more, hoping that things will play out as expected.
Have a profitable day!
