Archives for February 2018

Hawaii Hilton Grand Vacations Package (Discount for Attending Timeshare Presentation)

Posted on February 8, 2018 // 10 Comments

hiltongv2If you’re somewhere cold and dreaming of sunny Hawaiian beaches, I just got this e-mail from Hilton Grand Vacations for a discounted Hawaii vacation package if you attend their timeshare presentation. I appears to be open to all. Offer expires 2/28/18.

  • 5 nights at a Hilton property in Honolulu (Oahu) or Waikoloa (Big Island) for $699. $299 non-refundable deposit initial deposit required. Balance of $400 + tax due when travel dates are selected. Looks like taxes are another $93-$98. You have up to 12 months from purchase date to travel.
  • 5,000 Hilton Honors™ Points.
  • $200 Spend a Night on Us certificate toward your next Hilton hotel stay.
  • Flexible travel dates – reserve your package now and select your travel dates at your convenience
  • You must attend a two-hour timeshare sales presentation “where you’ll learn how you and your family can enjoy the many benefits and privileges of vacation ownership with Hilton Grand Vacations Club”. Married couples must attend together.

I’ve only done one timeshare presentation in my life, and as a young couple it felt worth exchanging our time for the free show tickets if a bit mind-numbing. They will do some theoretical math that if you travel X times at Y room rate at Z inflation/annual price hikes, you will spend $253,332.45 dollars. Surprise! The timeshare is always “cheaper” using their numbers.

Keep in mind you can always buy after the presentation is over, it’s not like they will say no down the road, no matter what “limited-time pricing” they dangle in front of you. Once you are out of the pressure cooker, you can do a reality check and compare what they are asking retail and the current resale value. If anything you might buy resale instead, keeping in mind that those annual maintenance fees also go up every year…

Here is the fine print. Paying what works out to ~$160 per night including taxes could be a sizable discount to booking directly. I’m unlikely to participate, but I am interested to see what others think. Has anyone had experience with this type of Hilton Grand Vacations offer?

Filed Under: Deals & Offers //

Robinhood App Review: Free Stock Trades, Free Options Trading, No Minimum Balance

Posted on February 8, 2018 // 86 Comments

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Updated. Robinhood is one of the new wave of brokerage apps. They started with free stocks trades, but have since expanded their suite of services to the following:

  • Free stock and ETF trades. No minimum balance requirement.
  • Free options trading. No commission and no per contract fee, plus no exercise or assignment fees.
  • Free trading of Bitcoin and other cryptocurrencies 24/7.
  • Free share of stock for new users with referral.

Top alternatives to Robinhood.

  • WeBull (free stock bonus). WeBull app is also good for active traders with free stock trades and free options trades, but adds a real customer service phone number where you can talk to a human, as opposed to Robinhood’s email address.
  • SoFi Invest ($75 bonus). SoFi also offers free stock trades and “slices” (fractional shares), along with a sign-up bonus and free tickets to events (SoFi is short for Social Finance).
  • Firstrade. Firstrade includes free trades of mutual funds, which is rare… if that is your thing.

Background. I’ve been Robinhood beta user since mid-2014. I was skeptical as I’ve been an long-time early adopter of free trading platforms (read: cheapskate investor). In August 2015, they rolled out both iOS and Android app and reported processing over 2 million free trades. In 2017, they reached over a million users. In 2017, Bloomberg reported them raising money at a $1.3 billion valuation. In 2020, CNBC reported them raising money at an $8 billion valuation!

Application process. You must provide your personal information including Social Security number, net worth, income, investing experience, etc. This is the same as any other brokerage firm, but this may also be the first such account for many users. Everything was done online; there were no paper documents that required mailing or faxing.

Core features review.

  • Legit. Robinhood Financial is a member of the SIPC which protects the securities in your account up to $500,000. Data is encrypted with SSL. Apex is their clearing firm.
  • $0 commission trades. Yes, it works, all with no minimum balance requirement.
  • Market orders, limit orders, stop limit orders, and stop orders available. Certain orders may be entered as good for the day or good till canceled (GTC).
  • No short-selling.
  • Free options trading: No commission and no per contract fee upon buying or selling options, as well as no exercise or assignment fees. Level 2 self-directed options strategies (buying calls and puts, selling covered calls and puts) as well as Level 3 self-directed options strategies such as fixed-risk spreads (credit spreads, iron condors), and other advanced trading strategies are available.
  • Customer service limitations. The Robinhood customer service phone number is (650) 940-2700 during during market hours (9:30am – 4:00pm EST), however many readers have reported difficulty getting through. (Update: I no longer see any mention of this phone number on their website.) They want you to use their customer service email “support@robinhood.com”. The lack of instant customer service via phone is one major way that Robinhood is not the same as a major brokerage account like Fidelity or Schwab.

Funds transfers. You can manually link any bank account with your routing number and account number, but you can also directly use your username and password at these banks: Chase, Bank of America, Citibank, Wells Fargo, U.S. Bank, Charles Schwab, PNC, Silicon Vally Bank, and USAA. ACH transfers are free and take approximately 3 business days (same as other brokerages). There is also a automatic deposits feature where you can schedule ACH transfers on a weekly, biweekly, monthly, or quarterly basis.

ACAT account transfers. Robinhood now accepts incoming stock transfers from outside brokerage accounts. To do this, go your app account menu, select “Banking”, then select “Stock Transfer” and follow the on-screen instructions. Incoming transfers are free. Outgoing transfers will incur a $75 fee.

Robinhood Instant. Robinhood Instant is a free upgrade that gets you a “limited margin account” that has the following features:

  • Immediate access to funds from selling stock. That means you can reinvest those funds without waiting two days for settlement. (All brokerage margin accounts offer this.)
  • Limited instant deposits. Use up to $1,000 of your pending bank deposits right away. No waiting 2-3 days for a bank transfer to complete.

What’s the catch? Getting free trades is great, but be aware of the following:

  • Although they announced that a web interface is available, I have been on the waitlist since early November (currently #600,000 in line). Full rollout is not scheduled until some time in 2018. Everyone can access their account via a mobile Apple iOS or Android device (iPhone, iPad, iPod Touch, Android phone, Android tablet).
  • There are unofficial sites that use the Robinhood API to provide web access, but I would be wary of sharing your login credentials with a 3rd-party.
  • I’m currently on a wait list for the free options trading as well.
  • Broker-assisted phone trades are $10 each, according to their fee schedule.
  • Electronic statements are the default and only free option. I don’t even see an option to enable paper statements in the app, but according to their fee schedule paper statements cost $5 a pop.

How do they make money? First, Robinhood will make some money the same way other brokers do: collect interest on your idle cash, charge you interest for margin loans, and sell order flow. The most innovative prospect is to the plan to sell API access to other financial apps.

The fact that Robinhood sells order flow may leave you with a slightly worse execution price as compared to other brokers with more complex order routing. If you are making large value trades, then this small percentage difference may add up to something significant that matters more than commission price. With my tiny order volume, I am fine with them selling my order flow if they are giving me commission-free trades.

Robinhood Gold is their premium service tier that gives you extending trading hours and interest-free margin for $10 a Month. My Robinhood Gold review.

User interface. Over the last 10 years, I’ve opened an account at the majority of the “discount” brokerage firms. I’ve had $0 trades before, along with $2 trades, $2.50 trades, $4.95 trades and so on. What makes Robinhood special is their modern, app-centric approach. I agree with this quote from Wired:

But the app’s simplicity is meant to be about more than style. Ease of access and understanding is meant to make Robinhood compulsively engaging for a new generation of investors that don’t find the stock market very accessible from the mobile screens at the center of their lives.

Screenshots.

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Recap. Robinhood delivers on their $0 stock trades promise with no minimum balance. The app interface is clean and intuitive. Customer service can be slow to respond as they direct you to contact them only via email.

Filed Under: Investing, Reviews //

Affirm: Immediate Gratification + Hiding The Pain of Paying Upfront

Posted on February 7, 2018 // 20 Comments

200jeans

Here is an interesting longform Racked article about Affirm micro-loans. Now, instead of (gasp!) saving up for a few months before paying cash for those $200 jeans, you could have them today for $235. It’s basically credit card debt for people who previously couldn’t get approved for a credit card. Hurray for innovation.

Sure, it may be more transparent and convenient, but here’s the real reason why you’ll soon see it everywhere:

Affirm is not just meeting a demand, but creating one, encouraging shoppers to buy and spend more. Affirm claims an average 75 percent boost in order values across all its merchant partners. Affirm is clearly not just facilitating purchases that would have otherwise happened through other means of credit. Four retailers I spoke with reported significantly higher sales, and more frequent purchases, with Affirm customers.

Saving for retirement is a form of delayed gratification. You could buy buy $235 jeans today, $200 jeans after saving up a few month, or you could invest it and wait 20, 30, 40 years down the road and be able to afford housing, food, and medical care when you’re old. Even if you’re a crazed fanatic like me with a 50% savings rate, you might wait 10 to 15 years before actually being able to “spend” the money you put away.

How can we avoid debt when it means immediate gratification? No easy answers here, but looking back, I used to check my net worth all the time. It’s hard to call that a healthy habit, but then again it did provide a form of immediate pleasure from saving $200 instead of spending it. I liked seeing the number go up. Mentally, I also knew I could use that money as a cushion if I wanted to try a new career path. In that way, having more money in the bank meant more freedom now, not just later.

Added: Dave Ramsey is famous for helping people out of debt, and one of his main tips is to pay cash for everything. At a minimum, use a debit card. (You could even “Debitize” your credit card.) That way, you feel the appropriate pain of each purchase. When you put things on a credit card with the idea of paying “later”, you are hiding that pain. $20 a month feels a lot easier than $200 upfront. This is why Affirm customers end up buying more stuff than cash buyers (on top of paying interest).

Filed Under: Credit Cards //

Wyndham Hotels Promotion: Stay Twice, Get One Free Night at Any Wyndham

Posted on February 7, 2018 // Leave a Comment

wyndham_rewardsWyndham Hotels has a new Stay Twice, Get a Free Night promotion. Wyndham Hotels is an interesting chain of hotels that includes Days Inn, Travelodge, Super 8, Howard Johnson, Ramada, Dolce, Wingate, and Wyndham Grand hotels. If you register here first as a Wyndham Rewards member, book by 6/30/18, and make two stays by 7/1/18, they will give you an additional bonus of 15,000 Wyndham Rewards points (on top of the points you’d otherwise earn).

15,000 Wyndham Rewards points are good for one standard bedroom night at any hotel under the Wyndham umbrella. So you could pay for two nights (make sure it’s two separate stays) at a Days Inn, and then redeem for a free night at a Wyndham Grand hotel. Don’t forget to join Wyndham Rewards for free and register first. If you got in on the (now expired) Wyndham credit card / 3 free night promo, you could make an extended vacation out of it.

This was timely for me because I was researching some family vacation possibilities and the Howard Johnson Anaheim (Disneyland) is also a Wyndham property. This is an often-recommended “Good Neighbor” Disneyland hotel with a huge water park that is also right across the street from Disneyland. The standard rooms often go for $200+ per night with taxes. If you live more on the luxurious side, there is the Wyndham Grand Chicago Waterfront.

Filed Under: Deals & Offers //

Grubhub Referral: $10 Off + Free Delivery on First Order

Posted on February 7, 2018 // 2 Comments

grubhub

If you have not joined Grubhub yet, you can get $10 off your first Grubhub order of $15+ and free delivery if you join via my referral link. I will get food credits as well. Thanks if you use it!

You can also get free Gruhhub+ membership with Lyft Pink membership (free with the Chase Sapphire Reserve card).

Filed Under: Deals & Offers //

NYT 7-Day Financial Tuneup: Free Customized Advice

Posted on February 6, 2018 // 1 Comment

nyt_ftuThe New York Times has a free 7-Day Financial Tuneup that asks you a few quick questions and then sends you a series of (somewhat) customized e-mails containing financial advice. I did the survey twice with different answers to reveal more possibilities, telling it that I had credit card, mortgage, and student loan debt. Here’s what came with my introductory e-mail:

Thanks for signing up for The 7-Day Financial Tuneup. Based on what you told us, we selected the seven tasks most relevant to your financial situation that we recommend you complete this week to optimize your individual financial situation. We will send you an email every day with a task that you can complete immediately, or choose to leave until later in the week when you have more time. These tasks will help you take important steps to educate yourself, trim your spending and determine your financial priorities. Check your inbox tomorrow for the first day’s task.

I haven’t gotten any e-mails yet, but here’s what I have to look forward to:

  • Day 1. Optimize Your Thinking. Prepare for the week ahead by taking a few moments to figure out how you think about money. (Good news: There are no wrong answers.)
  • Day 2. Trim Your Budget. Cut costs on things you don’t use, and lower your spending on the essentials.
  • Day 3. Find the Best Credit Card for You. Make sure you have a credit card that matches your needs.
  • Day 4. Plan for Your Retirement. Take a moment to save for retirement, your future self will thank you.
  • Day 5. Understand Your Credit. Learn how to read your credit score and figure out how to make it better (if you need to.)
  • Day 6. Save on Health Care Costs. Make sense of your flexible spending plans and figure out the right amount to set aside tax-free.
  • Day 7. Student Loans. Organize your existing loans and set a reasonable plan to pay them off.
  • Other possible topics include “Compare Insurance Rates” and “Funding your Emergency Funds”.

Altogether, I would think of it as a free, short personal finance book. Sounds good to me.

Filed Under: Frugal Living //

Callan Periodic Table of Investment Returns 2018

Posted on February 5, 2018 // 1 Comment

callan2016clipWe’ve all been told that past performance is no guarantee of future returns, but it’s still hard to buy an investment that has been performing poorly. We should remember the historical power of diversification and that even though something may look horrible now, good news may be just around the corner. We also need to remember that whatever is hot today won’t stay that way forever.

Callan Associates updates a “periodic table” annually with the relative performance of 8 major asset classes over the last 20 years. You can find the most recent one at their website Callan.com. The best performing asset class is listed at the top, and it sorts downward until you have the worst performing asset. Here is the most recent snapshot of 1998-2017:

callan2018

The Callan Periodic Table of Investment Returns conveys the strong case for diversification across asset classes (stocks vs. bonds), investment styles (growth vs. value), capitalizations (large vs. small), and equity markets (U.S. vs. non-U.S.). The Table highlights the uncertainty inherent in all capital markets. Rankings change every year. Also noteworthy is the difference between absolute and relative performance, as returns for the top-performing asset class span a wide range over the past 20 years.

I find it easiest to focus on a specific asset class (Color) and then visually noting how its relative performance bounces around. Last year, I noted that Emerging Markets (Orange) and MSCI World ex-US (Light Grey) have been near the bottom for a while and I was still holding them and waiting for them to bounce back. In 2017, my diversification and patience paid off and they were indeed at the top again.

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Filed Under: Investing //

ICYMI: E-Trade Super Bowl 2018 Commercial “This Is Getting Old”

Posted on February 5, 2018 // 2 Comments

E-Trade’s newest commercials (remember the baby?) have the basic premise of (1) you don’t have enough money and (2) to solve this, you should open an E-Trade brokerage account. The Super Bowl commercial was more specific: Don’t be 85 years old and #stillworkin. Here’s the full commercial from YouTube:

Filed Under: Investing //

Best Interest Rates on Cash – February 2018

Posted on February 4, 2018 // 8 Comments

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Short-term interest rates continue to rise, as are inflation expectations. Meanwhile, the megabanks make billions by pay you nothing for your idle cash. Here is my monthly roundup of the best safe rates available, roughly sorted from shortest to longest maturities. Check out my Ultimate Rate-Chaser Calculator to get an idea of how much additional interest you’d earn if you switched over. Rates listed are available to everyone nationwide. Rates checked as of 2/4/18.

High-yield savings accounts
While the huge brick-and-mortar banks rarely offer good yields, there are a number of online savings accounts offering much higher rates. Keep in mind that with savings accounts, the interest rates can change at any time.

  • AbleBanking at 1.70% APY, DollarSavingsDirect and Live Oak Bank at 1.60% APY, CIT Bank at 1.55% APY, all with no minimum balance requirement. SalemFiveDirect, Marcus/GS Bank at 1.50% APY.
  • I currently keep my “hub” account at Ally Bank Savings + Checking combo due to their history of competitive rates, 1-day external bank transfers, and overall user experience. I then move money elsewhere if the rate is significantly higher (and preferably locked in via CD rate). The free overdraft transfers from savings allows to me to keep my checking balance at a minimum. Ally Savings is now lagging a bit at 1.35% APY.

Money market mutual funds + Ultra-short bond ETFs
If you like to keep cash in a brokerage account, you should know that money market and short-term Treasury rates have been rising. The following money market and ultra-short bond funds are not FDIC-insured, but may be a good option if you have idle cash and cheap/free commissions.

  • Vanguard Prime Money Market Fund currently pays an 1.45% SEC yield. The default sweep option is the Vanguard Federal Money Market Fund, which has an SEC yield of 1.29%. You can manually move the money over to Prime if you meet the $3,000 minimum investment.
  • Vanguard Ultra-Short-Term Bond Fund currently pays 1.88% SEC Yield ($3,000 min) and 1.98% SEC Yield ($50,000 min). The average duration is ~1 year.
  • The PIMCO Enhanced Short Maturity Active Bond ETF (MINT) has a 1.75% SEC yield and the iShares Short Maturity Bond ETF (NEAR) has a 1.86% SEC yield while holding a portfolio of investment-grade bonds with an average duration of ~6 months. More info here.

Short-term guaranteed rates (1 year and under)
I am often asked what to do with a big wad of cash that you’re waiting to deploy shortly (just sold your house, just sold your business, legal settlement, inheritance). My usual advice is to keep things simple. If not a savings account, then put it in a short-term CD under the FDIC limits until you have a plan.

  • CIT Bank 11-Month No-Penalty CD is at 1.55% APY with a $1,000 minimum deposit and no withdrawal penalty seven days or later after funds have been received. The lack of early withdrawal penalty means that your interest rate can never go down for 11 months, but you can always jump ship if rates rise. Full review. You can open multiple CDs in smaller increments if you want more flexibility.
  • Live Oak Bank has a 12-month CD is at 2.10% APY with a $2,500 minimum deposit. Early withdrawal penalty is 90 days of interest. Ally Bank has a 12-month CD at 2.00% APY again, but with $25,000 minimum deposit. Early withdrawal penalty is 60 days of interest.

US Savings Bonds
Series I Savings Bonds offer rates that are linked to inflation and backed by the US government. You must hold them for at least a year. There are annual purchase limits. If you redeem them within 5 years there is a penalty of the last 3 months of interest.

  • “I Bonds” bought between November 2017 and April 2018 will earn a 2.58% rate for the first six months. The rate of the subsequent 6-month period will be based on inflation again. At the very minimum, the total yield after 12 months will be 1.29% with additional upside potential. More info here.
  • In mid-April 2018, the CPI will be announced and you will have a short period where you will have a very close estimate of the rate for the next 12 months. I will have another post up at that time.

Prepaid Cards with Attached Savings Accounts
A small subset of prepaid debit cards have an “attached” FDIC-insured savings account with exceptionally high interest rates. The negatives are that balances are capped, and there are many fees that you must be careful to avoid (lest they eat up your interest). The offers also tend to disappear with little notice. Some folks don’t mind the extra work and attention required, while others do.

  • Insight Card is one of the best remaining cards with 5% APY on up to $5,000 as of this writing. Fees to avoid include the $1 per purchase fee, $2.50 for each ATM withdrawal, and the $3.95 inactivity fee if there is no activity within 90 days. If you can navigate it carefully (basically only use ACH transfers and keep up your activity regularly) you can still end up with more interest than other options. Earning 4% extra interest on $5,000 is $200 a year.

Rewards checking accounts
These unique checking accounts pay above-average interest rates, but with some risk. You have to jump through certain hoops, and if you make a mistake you won’t earn any interest for that month. Some folks don’t mind the extra work and attention required, while others do. Rates can also drop quickly, leaving a “bait-and-switch” feeling. For example, Northpointe Bank was mentioned for several months here but recently stopped accepting new applications. Unclear how long existing accountholders will be grandfathered. That’s just how it goes with these types of accounts.

  • Consumers Credit Union offers up to 4.59% APY on up to a $20k balance, although getting 3.09% APY on a $10k balance has a much shorter list of requirements. The 4.59% APY requires you to apply for a credit card through them (other credit cards offer $500+ in sign-up bonuses). Keep your 12 debit purchases small as well, as for every $500 in monthly purchases you may be losing out on 2% cashback (or $10 a month after-tax). Find a local rewards checking account at DepositAccounts.

Certificates of deposit (greater than 1 year)
You might have larger balances, either because you are using CDs instead of bonds or you simply want a large cash reserves. By finding a bank CD with a reasonable early withdrawal penalty, you can enjoy higher rates but maintain access in a true emergency. Alternatively, consider a custom CD ladder of different maturity lengths such that you have access to part of the ladder each year, but your blended interest rate is higher than a savings account.

  • Live Oak Bank has an 18-month CD at 2.30% APY ($2,500 min) and a 24-month CD at 2.35% APY ($2,500 min). The early withdrawal penalty is the equivalent of 90 days of interest on the principal amount withdrawn for CD terms less than 24 months or 180 days of interest on the principal amount withdrawn for CD terms of 24 months or longer.
  • Ally Bank has a 5-year CD at 2.50% APY ($25,000 minimum) with a relatively short 150-day early withdrawal penalty and no credit union membership hoops. For example, if you closed this CD after 2 years you’d still get an 1.99% effective APY even after accounting for the penalty.
  • Connexus Credit Union has a 5-year Share Certificate at 3.00% APY ($5,000 minimum deposit) with a 365-day early withdrawal penalty $5,000 minimum deposit. Anyone can join this credit union via partner organization Connexus Association for a one-time $5 fee. I ran a Ally vs. Connexus 5-year CD comparison to show the effect of a larger early withdrawal penalty. Note that Ally rates have risen a bit since that post was published.

Longer-term Instruments
I’d use these with caution due to increased interest rate risk, but I still track them to see the rest of the current yield curve.

  • Willing to lock up your money for 10+ years? You can buy certificates of deposit via the bond desks of Vanguard and Fidelity. These “brokered CDs” offer the same FDIC-insurance. As of this writing, Vanguard is showing a 10-year non-callable CD at 2.85% APY (Watch out for higher rates from callable CDs from Fidelity.) Unfortunately, currently CD rates do not rise much higher even as you extend beyond a 5-year maturity.
  • How about two decades? Series EE Savings Bonds are not indexed to inflation, but they have a guarantee that the value will double in value in 20 years, which equals a guaranteed return of 3.5% a year. However, if you don’t hold for that long, you’ll be stuck with the normal rate which is quite low (currently a sad 0.10% rate). I view this as a huge early withdrawal penalty. You could also view it as long-term bond and thus a hedge against deflation, but only if you can hold on for 20 years.

All rates were checked as of 2/4/18.

Filed Under: Banking, Deals & Offers, Investing, Treasury Bills and Bonds //

401k Millionaire By Age 45: How Was It Possible?

Posted on February 1, 2018 // 19 Comments

millWith the ongoing bull stock market, more people are reaching $1,000,000 balances in their 401k every day. However, a more extreme claim is that someone reached this mark at age 45 with total employee contributions of only $300,000. Is that really possible? Let’s take a look at what would need to fall into place for that to happen…

Consistently high contributions from salary. If you divide $300,000 by a theoretical 25 years of savings, that works out to $12,000 per year. That is within 401k historical contribution limits, but even with 25 working years, that means nearly maxing out your 401k contributions every single year. (Employer company matches don’t count and can push you above that limit.) According to Redditor Subject_Beef, s/he indeed saved regularly in 1995 with contributions close to the max most years. Consider that only about 10% of participants max out their 401ks each year, and most of those people were over the age of 45.

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High investment gains. Next, you must have the growth of $300,000 to $1,000,000, which would require a high stock allocation, avoidance of a prolonged bear market, and not panicking during market losses. Even with a lump-sum invested 25 years ago, going from $300k to $1000k would require a compound annual growth rate of 6.2%. However, with a 401(k), you have to do this through regular contributions and dollar-cost-averaging over time. Therefore, the actual growth rate would have to be significantly higher than that. By my rough calculations, the average would have to have been around 9% annually. The current asset allocation was shown to be roughly 37% S&P 500 Index fund, 33% US Small Cap Stock Index fund, and 30% International Stock Index fund. The annualized return of the S&P 500 has been about 10% over the last 23 years, so the numbers are quite possible.

No IRA rollovers. Finally, you’d need a steady career as most people who change companies either cash out or roll their 401(k) funds into an IRA with more flexibility. It is possible to do repeated 401k-to-401k rollovers, which is apparently the case here. I can’t think of too many compelling reasons to do so besides enabling the Backdoor Roth IRA. This is also why I don’t think tracking aggregate 401k balances is a good way to measure savings or wealth. People move funds out of 401ks into IRAs all the time.

Altogether, I believe this story and the numbers do check out. However, this is not a common occurrence given the factors above that have to align. The poster does mention a significant employer match that would have help increase the effective contributions above $300,000 and make it a bit more realistic for an average worker. In any case, becoming a 401(k) millionaire by age 45 is an impressive accomplishment.

Filed Under: Inspirational, Investing, Retirement //
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