Is my math right?

[mooshie]

So I was just playing around with numbers today. DH and I have $136,290 in investments currently.
Assuming that we max out DH's 401K and both of our ROTH IRAs each year until the end of 2026 and earn an average of 10% per year my math says we'd have 1,018,880 by the end of 2026. Just checking to make sure I didn't neglect something that would make a change to this?
Also this beginning figure includes the remaining 401K contributions for this year just FYI.
Thanks!

[MDM]

So I was just playing around with numbers today. DH and I have $136,290 in investments currently.
Assuming that we max out DH's 401K and both of our ROTH IRAs each year until the end of 2026 and earn an average of 10% per year my math says we'd have 1,018,880 by the end of 2026. Just checking to make sure I didn't neglect something that would make a change to this?
Also this beginning figure includes the remaining 401K contributions for this year just FYI.
Thanks!

That's exactly (subject to rounding) what I get, so unless we are both wrong....

Assumptions
 - The $136,290 includes 2015's 401k and IRA contributions, and those were made at the beginning of 2015 so there are 12 years growth until the end of 2026.
 - By max you mean $18K + $5.5K + $5.5K = $29,000/year
 - The $29K is invested at the beginning of the year, starting in 2016
 - Returns compound annually
 - the Excel FV function works

Value of the $136,290 at the end of 2026 = $136,290 * (1 + 10%)^12 = $427,736.40

Value of the series of $29K investments = FV(10%,11,-47000,0,1) = $591,144.23

Total = $1,018,880.63

Of course, if the assumptions are wrong then the results will differ.

[Joshua]

Nominally yes, although inflation will take it's bite.

[velocistar237]

Why the Roth? Do you not qualify for Traditional?

It won't change the number you're looking at, but it would give you a little extra to put in taxable accounts each year.

[jmusic]

10% is a pretty high return also.  Historical market average is around 7%.

[obstinate]

- the Excel FV function works

I think PV is the one you're interested in. That'll give you a better sense of what the investment is worth in the context of your current spending.

[Cougar]

its right.

but i would second this.

10% is a pretty high return also.  Historical market average is around 7%.

i play around with the numbers myself on if i could make better than average, 7 percent; for a few years to get fire sooner but you usually get burned trying to beat the avg unless youre very patient like going all cash in 2007 and going all in the market again in 2010, but the people that did that could probably fit in a small room.

[GeorgiaCPA]

I have been running some similar calculations for my retirement, and am in a very similar state that you are in (less than $200K in retirement, and currently maxing out 401k and 2 Roth IRA's).

I project that I will continue to max out tax advantaged accounts, and add an additional $5K to contributions to savings every year until retirement (i.e. $5K next year, $10K the year after, and so on) (these will be outside of qualified retirement plans and offer no additional tax benefits).  I have found that projected return has little impact on the value of projected investments over a 10 year time frame.  While I use 6% for my own projections, changing the projection to 8% only accelerates my FI date by 1 year.  An increase to 10% accelerates FI by another year.  Therefore, over a 10 year timeframe a 2% change in average returns will cost you a year.  Even if your projections are a bit rosy, your dates shouldn't change by much.  A bigger impact on your FI date could be had by investing more over the next 10 years, or further reducing your cost of living.