Just did the math on this. We get to about 15% between our IRAs and my wife's defined contribution plan. I do not have a plan through work, but Mrs. Cool has both a defined contribution and defined benefits plan. There were times in my 20s I legit thought I was a month or two away from sleeping in my car, so I get how it can be hard for people to sock away any amount of money, but we all, collectively and individually, gotta find a way to do it.
Goodness...it sounds like you're not in that situation any more. That must be a huge relief.
Guys, I'm kinda new to personal finance (maybe about 3 years). I'm getting more into the idea of maxing everything out, being a responsible adult, doing well for myself and a future family. I've been figuring out what it would look at different incomes and investment strategies. I live in MO, so I'll factor in taxes for MO accordingly...
1. Poverty line
Pre-tax income: $22k.
Post-tax income: $18k
Investment strategy: 6k into Roth IRA
Left over: $12k (or about $1k/month)
2. Average income
Pre-tax: $50k
Post-tax: $40k
Investment strategy: $6k into Roth IRA, $19.5k into 401k
Left over: $12.5k (or about $1k/month)
3. Six-figures
Pre-tax: $100k
Post-tax: $70k
Investment strategy: $6k into Roth IRA, $19.5k into 401k
Left over:$42.5k (or about $3.5k/month)
4. Mid-career
Pre-tax: $150k
Post-tax: $100k
Investment strategy: $19.5k into 401k
Left over: $80.5k (or about $6.5k/month)
5. Baller
Pre-tax: $200k
Post-tas: $140k
Investment strategy: $19.5k into 401k
Left over: $120.5k (or about $10k/month)
Presently, I'm in category 1, because I'm a graduate student on a living stipend, so that's what I'd get. I would say I live "comfortably", but I intentionally avoid large expenses (no car, rare trips, etc.). I think supporting a family on that income would be extremely challenging, if not undoable.
Category 2 leaves me with the same net "leftover" money after investing, so I'd assume my QoL and lifestyle would be exactly the same as it is in Category 1.
Category 3 looks to be the biggest step up. As a single person, I feel that I would be able to have everything I could really want. I think it would be totally doable to support a family on that income, too. It'd be tight, but I think I could do it and spouse wouldn't need to work either.
Category 4 looks like I wouldn't really feel a difference between 3 and 4 if I were a single person. But with kids and a family, it looks like we'd be pretty cushy. They'd go to the best private schools, enjoy the best extracurricular activities. We'd be looking good.
Category 5 looks extraneous. I can't think of what would be added to life stepping from 4 to 5. More real estate investing? Multiple homes? Trophy cars? Not sure what would be gained.
I'm kind of an idealist and I honestly don't have a clear perspective on things. This is just how the numbers seem to me. Please correct me if I'm way off base or if you have something to add from your experience.