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One needs one million dollars to retire when they turn 65. To most people, that number seems absolutely impossible, but while it is definitely not easy, it is possible to have a million dollars by 65. It takes a lot of discipline and financial planning, but it is possible.
The trick to building a million dollar net worth is investing over a long period of time. If one can start investing 200 bucks a month when they are 20 into an S&P 500 index fund and that fund goes up an average of 10% a year which is the historical average, they will retire with a million dollars.
If one can take that same 200 bucks a month and invest it into an S&P 500 index fund but through a Roth IRA instead of a traditional investing account, they would still have a million dollars, but they now wouldn't have to pay any taxes on that money when they take it out. Having a million dollars untaxed at 65 allows one to retire comfortably, and while 200 dollars is no small amount of money, it is a reasonable amount to invest each month.
Even if one can't invest 200 bucks a month, they should still invest the extra that they do have. Anything is better than nothing in this case, and even if they don't get to a million dollars at 65, they at least helped give themselves something.
When it comes to retirement, it isn't guaranteed. It's something that we all have to work towards our whole lives. The best way to achieve retirement is to start investing and allow one's wealth to compound over time.
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