This drives my point home friends...
Kevin: why would you want to switch from one money pit to the other? why not just drop it entirely.
IF you look at it this way.
the average cable bill in the USA is 150 a month.
the amount of money required to fund a IRA to be worth about 1.7 mil in 40 years is 100 a month..
Me: Curious what calculations you used here... Funding $100 a month to an IRA (starting from 0) at a very aggressive 10% return (I use 7% in my calculations to be safe) would only net you $643,000. I think you might have been looking at last years returns, that's unsustainable. As you can see from the start of this year, where returns are at 2% thus far. With the run we have had, we will have a year rather soon with negative returns.
Kevin: Chris Wood you would have to ask Dave. he did the calculations. but looking at one years returns to calculate is a poor choice. you need to look at the long term averages.
Me: Exactly, that's why I go by historical averages and not last year's amazing stock market performance. 8% is the standard and I assume that is what he used for his calculations. If you go back and look, I would assume he stated $100 a week into an IRA will get you 1.7 mi. I did the calculations, and it will indeed net you 1.6 million if you fund $100 a week to a Roth IRA at 8% interest.
Kevin: Chris Wood feel free to tell dave he is wrong.. I want to watch though
Me: Kevin Schertz Can you post the link where he stated these numbers, or which podcast it was. I honestly think that you just misread what he said. I understand you believing what Dave says, but it's not really up for debate how much money it would come out to... It's simple Math, and based off 100 years of historical returns, it's simply impossible to net 1.7 mil off saving $1,200 a year for 40 years. And yes, if Dave stated this, (I highly doubt he did), than he is wrong.
He literally didn't listen to a word I said, he just said Dave is never wrong... Who would have known you can net 1.7 mil in 40 years from just putting away $100 a month...