I am late 40s with about $6.4m. I am wondering if I should stay, move on, or just stop. I am motivated to stay for now, but not completely sure why with all of the uncertainty. What is your financial position and what are you doing?
38 replies (most recent on top)
What psg are you? I’d milk it to the end with an fu attitude.
51, 2.5, leaving to do something new
Take the severance
Are you counting your 401k and primary residence? If so, try without
If you oh factor in say 6 years as in expat in 34-40 age range (extra $1MM) it’s quite doable.
Yea, I took the package in 2020. I was fortunate to have already been in the market for 30+ years and had a bit to start with, so I am at 16M investible and another 5M in real estate that I don't count but is technically part of net worth, as well as an emergency cash cushion. I was thinking that I would become a walmart greeter or something similar because of this excruciating economy. I drowning here. I would like to at least get some health insurance because, you know, they may take all that from us too, you never know.
@fv+1jqh2pa3n LMAO! Best post here! Check with your barber too if this site doesn't work out lol!
I'm 61 and retired at 52 with the 2016 package. I have $10MM+ in investments, a $1.5MM home (with no mortgage) and no debt. I'm kinda worried about the economy and thinking that I may have to get back into the working world. Any suggestions?
@f2 - totally agree. Using deterministic fixed rate models or simple rules like the 4% rule will always be wrong and will give you a false sense of security. If a Financial firm suggests using these, run away.
Run a probabilistic economic model to determine the probability of running out of money during your retirement. The better financial firms can do this for you. Deterministic economic models using fixed ROR, inflation etc are useless for retirement planning. A lot of economists are forecasting Stagflation. Stagflation, seen in the 1970s, is particularly painful because it means a lack of job opportunities, low economic growth and higher prices.
Op here. Post wasn’t a brag, but more about checking in with peers (not sure of normal net worth) and trying to find direction in my path forward. If you want to know, net worth came from 25+ years of frugality, lower COL area htx, avoiding all debt, some small inheritance, spousal contributions, some very good investments to more than offset the bad ones, and no major bad events like divorce, but all of that is beside the point. Thank you for the thoughtful responses.
My net worth has increased since I retired. This is because I can spend more time thinking about my investments and seek out better opportunities. Having said that, I believe it is impossible to have too much money saved up for retirement. The more you know, the more uncertainty and risk you find in the economy. I think the greatest risk to your money is inflation. At the end of 40+ years of your retirement, the dollar will be worth a fraction of what it is worth today.
OP: if I were in your shoes, with $6.4 mil & late 40’s, I’d take the severance & run.
Go enjoy life while you cane.
I know to many who retired & dropped dead or were diagnosed with god awful stuff.
late 40s means 48, 49 years old... if you started CVX at 21 years old and maxed out your 401k and invested heavily and get PSG 22-23,24... very doable with compound interest and if you got lucky and invested in California real estate... I have friends with multiple properties (bought during great real estate recession) and each one in 1M+ w very high equity
Very achievable if the OP lives in the Bay Area.... $ 6.4M net worth is good but not impressive
Buy a home in San Ramon HQ area for 500k back in 2000.. that's 2M now... equity of 1.8M
Max out 401k invested for 20 years with 8% in index fund returning 15% ... ... 1.7M + 2.5M
Pension
After tax investments...
plus.. spouse making similar money in the Bay Area...
When taken at face value, the OP's post is lacking sufficient information to either applaud the effort or call BS on it. Is the OP reporting the total worth of his assets or his net worth or the balance of his retirement account or cash on hand? These are very different scenarios with very different implications. For example, if OP has $6.4M worth of real estate, that tells us absolutely nothing about his net position since we know nothing about the liabilities side of the equation (mortgage balances, etc).
If the OP implies that a combination of his retirement accounts & real estate value is worth around $6.4M, then that is a plausible scenario. However, If the OP says his investment accounts are worth $6.4M, then I call BS on it -- UNLESS the OP was an early adopter of virtual currencies and has built up his wealth that way.....
Let's break some of these scenarios down with some very simple "back of the envelope" calculations....The OP is in his late 40's and therefore has roughly 25 years of oil and gas experience. Let's very generously assume that over that period the OP averaged $200k/year in compensation (which would account for sub $100k salary in early career and possibly $300k+ in late career periods). $200k over 25 years would come out to $5M in revenue. After accounting for taxes and living expenses, at BEST, the OP would have been left with half of that amount of $2.5M (or $100k per year) in pure "investable" principle.
- Real Estate Investment scenario. Let's assume the OP lives in Texas and invested $100k/year in real estate over the same 25 years. Over the past 25 years, Texas real estate market appreciated 150% (or 6% per year). With this scenario, it is possible to get above $6M if the OP has done better than the market average and bought real estate at the right time (after Hurricanes Ike or Harvey, for example). If the OP is in California where the real estate market has appreciated 200% over the past 25 years (or 8%/year), then it becomes more plausible to accumulate $6M in real estate investments & associated price appreciation.
- The Investment Account Scenario. If I have $100k to invest every year and I do that for 25 years, I would have to achieve an effective interest rate of 7.1% per year to be able to make $6.4M at the end of that period. Over the same 25 years, the S&P 500 averaged a rate of return of 6.8% (after adjusting for inflation). So, the OP would have had to invest 50% of his earnings AND do better than the S&P for 25 years straight arrive at $6.4M....While this scenario is theoretically possible, it is highly unlikely.
In every scenario above, OP's investments would have had to perform "better than average" over 25 years under the assumption of 50% of total revenue being reinvested annually. I call BS on this, BUT what I really think is happening "under the hood" is that the OP is claiming some sort of starting non-zero capital (i.e. family assets or wealth) as his own, which over time serves as a "spring board" to get him to the $6.4M number....
The amount of skepticism is surprising. Being late forties with that amount seems achievable by avoiding debt and waste.
If you are in a normal COL area, not HCOL, not a spendthrift, don't have dependents(or many) and are a prudent investor, $6.4 mm in late 40s is pretty much recession proof. Most people that young with that net worth do continue working, because that's what most successful people do. It's just a matter of fact. Mid to late 50s is a different story.
The TDS guy is back? So afflicted that he tries to unsuccessfully derail every thread with his unrelated conspiracy trolling.
It is totally possible. I am early 40s and have about 20% less. But I did a poor job of investing and so easily would be at OP level. It really depends on PSG, expat assignments and spend rate.
Some person posted:
6.4mm is not a good financial position at 40 plus years old.
Here is the average data from the US:
*Average Retirement Savings by Age
Ages 35-44: Average household retirement savings: $141,520.
Ages 45-54: Average household retirement savings: $313,220.
Ages 55-64: Average household retirement savings: $537,560.
Ages 65-74: Average household retirement savings: $609,230.
Ages 75 and older: Average household retirement savings: $462,410.*
So, it would seem like the OP is in a good position, no?
the stock market is probably over-valued by 50%
so cut your net worth by 1/2
Every economist agrees that DJT policies are stupid and will result in a recession. Its probably a good idea to keep working.
There are some strong reactions to this post. I see the California crew entered the chat —probably that tattooed geo guy. Late 40’s here too. A bit smaller net worth, but close. I stay for health insurance.
So basically, you didn't save, 6.4mm is not a good financial position at 40 plus years old.
Make America Great Again is a person? I am not from the US. I thought that was a chant. You would think that is a good thing, mate why does your adversary not like it?
You ( as well as all on this thread) should donate all of that and any savings to needy children and people worldwide, or you will be responsible for their deaths, according to one poster below. You will be responsible for any deaths if you do not donate all of your savings to people who are dying, starving, etc. and need it, and so will every person on this thread, this whole website, as far as that goes.
So there's your answer. Any more questions?
Keep working! We depend on you for social security and income tax.
You should just continue to snivel and whine on this website because you have no life, regardless of how much you claim to have saved. Money, especially less than 10M, is nothing at that point, and won't buy happiness, which you are revealing to everyone.
You are way behind. I have $50 MM by 30 and $200MM when I was 40. You are sc--wed OP.
@ae+ LOL nice humor
Why don't you use some of your money to help others? It's estimated that 15,000 people have died already (mostly children) since DJT trashed USAID. The USA is by far the richest country, and others need our help.
I would believe $6MM, but I have always lived frugally and invested. I worked office, then expat for a decade, which gave me a big bankroll, then a decade outside Chevron @$200-$240K a year.. My wife had a good paying job as well. On paper, I guess I have $3MM in rental property and $4MM in Bank and stock market. Rental property return is not great due to ISD and Harris County Taxes, it is periodically a lot of work, but property appreciation makes it worthwhile. I live in a small old house and just bought my first new car in 8 years. No desire to change. My kids will have nice inheritance. Money doesn't necessarily bring happiness. A good marriage does.
Using the 4% rule, 6.4 million gives you 256k/yr. If I were you I would have left with less than half that.
I'm 38 and have about 650k but only made about 65k/yr until 2022 at service companies. My plan is to hopefully continue working at Chevron for another 5 years and retire with ~1.5 million.
This post is pure bs. No way you have that much money at 40 unless you won the lottery, invested in bitcoin early or got an inheritance. " I am 50 and have 100 Million dollars" not. Are you just stupid or do you like torture. If I had the money you say you do I would leave immediately. Really I am 52 and will have 2.1 million at 55. I am at exxon and can leave at 55. I will net about 160k per year with my financial institution.
Same age as OP, I have more money than OP
I’m calling nonsense.