15-08-2019, 06:21 PM
Kevin O’Leary: This is the age when you should have at least $100,000 saved
Jade Scipioni
Published Wed, Aug 14 2019 12:26 PM EDT
Although “Shark Tank” star Kevin O’Leary says he doesn’t like to “peg a number” to certain financial milestones, he does believe there is a point in one’s life where they should have at least six figures saved.
“By the time you hit 33 years old, you should have $100,000 saved somewhere. Make that your goal. Thirty-three [and] $100,000,” O’Leary tells CNBC Make It.
Why 33? O’Leary says it’s the “tipping point” in a person’s life when they have to focus on saving money and if they don’t, they fall “behind the eight-ball.”
While he admits that amount may sound “impossible” to most Americans — research has shown that a majority (57% of Americans, according to 2018 gobankingrates.com data) don’t even have $1,000 saved — he says anyone can do it if you start saving early enough.
“I’ll tell you how: You save 20% of your paycheck and you let the market grow at 5% to 7% a year [and] you can get to a $100,000,” O’Leary says.
For example, if you’re 22 and making a median salary of $48,400 (for new graduates), and you start saving 20% per paycheck, that amounts to $9,680 a year. Even if you keep the same salary and assume no interest, saving that amount for 11 years gets you $106,480 by the age of 33. By investing the same money, and assuming O’Leary’s 5% growth, that gives you $144,397 in the same amount of time. (The S&P 500 Index has averaged annual returns of approximately 10% since its inception in 1926.)
“You have to start in your 20s. You just have to, because you want to end up in your 60s with a boatload of cash sitting in investments, so you can kick back and relax a little bit,” O’Leary says.
More details in https://www.cnbc.com/2019/08/14/kevin-ol...saved.html
Jade Scipioni
Published Wed, Aug 14 2019 12:26 PM EDT
Although “Shark Tank” star Kevin O’Leary says he doesn’t like to “peg a number” to certain financial milestones, he does believe there is a point in one’s life where they should have at least six figures saved.
“By the time you hit 33 years old, you should have $100,000 saved somewhere. Make that your goal. Thirty-three [and] $100,000,” O’Leary tells CNBC Make It.
Why 33? O’Leary says it’s the “tipping point” in a person’s life when they have to focus on saving money and if they don’t, they fall “behind the eight-ball.”
While he admits that amount may sound “impossible” to most Americans — research has shown that a majority (57% of Americans, according to 2018 gobankingrates.com data) don’t even have $1,000 saved — he says anyone can do it if you start saving early enough.
“I’ll tell you how: You save 20% of your paycheck and you let the market grow at 5% to 7% a year [and] you can get to a $100,000,” O’Leary says.
For example, if you’re 22 and making a median salary of $48,400 (for new graduates), and you start saving 20% per paycheck, that amounts to $9,680 a year. Even if you keep the same salary and assume no interest, saving that amount for 11 years gets you $106,480 by the age of 33. By investing the same money, and assuming O’Leary’s 5% growth, that gives you $144,397 in the same amount of time. (The S&P 500 Index has averaged annual returns of approximately 10% since its inception in 1926.)
“You have to start in your 20s. You just have to, because you want to end up in your 60s with a boatload of cash sitting in investments, so you can kick back and relax a little bit,” O’Leary says.
More details in https://www.cnbc.com/2019/08/14/kevin-ol...saved.html