Personal Finance

I'm in my late 30s and have grown my 401k to $273k - is it still possible to hit $1 million by retirement?

Joey Frenette

Published: December 13, 2024 11:14 am

If you’re still in your 30s, there’s ample time to save up for that seven-figure nest egg. And though it may seem unrealistic to be able to grow a $273,000 sum in a 401k into a million or more by retirement, I do think that one can really surprise themselves by making the most of the long-term compounding.

Indeed, with the right financial plan (a financial advisor is key to keeping them on track), hitting the $1,000,000 milestone mark is not out of the question. In fact, depending on one’s contributions and how long one plans to stay in the labor force, a million may be the perfect figure to shoot for.

Sure, a million in a 401k is quite ambitious, especially since only ~3% of Americans have accomplished the feat, as I remarked in my prior piece. But with the right plan in place, I view such a goal as achievable for someone who’s relatively young (peak earnings years may still lie ahead) and already more than 27% of the way there.

Key Points About This Article

• A $273,000 sum is a great start in a journey to a $1 million 401k.
• The right investing plan is key if one wants to really grow their 401k in the coming decades.
• Also: Take this quiz to see if you’re on track to retire ^(Sponsored)

Shooting for $1 million 401k by retirement? Keep contributing to that 401k!

Someone in their late 30s may have yet to reach their peak earnings years. Undoubtedly, it can take many decades to climb to (or at least close to) the top of that corporate ladder. Whether one secures the big promotion in their 40s, 50s, or even 60s, the key thing is to stay consistent with one’s plan in place.

If you’re earning more money with every pay raise, you’re probably going to want to spend more money to compensate, especially if you’re putting in the extra hours and have less leisure time. While it’s natural to want to ramp up your personal spending habits by upgrading your smartphone every single year or splurging on discretionary goods, keeping expenditures in check is key to moving you along the retirement road.

Of course, some speed bumps (unexpected expenses or market volatility) can be expected along the way, but as long as you brace for them, they shouldn’t take you off the path to a $1 million retirement nest egg. If you’re unsure if you’re prepared, do check in with a financial advisor. It’ll be worth it.

Investing 401k proceeds wisely is a must.

Undoubtedly, it will likely take more than just making consistent contributions to get you on the path to nearly quadrupling your 401k by retirement. You’re going to need to invest wisely. And with such a lengthy investment horizon (let’s say they’re just shy of three decades from retiring), stocks stand out as one of the best ways to grow one’s portfolio. While I’m a fan of S&P 500 index funds or do-it-yourself (DIY) stock picking, I’d encourage you to take an assessment with a financial advisor so that they can better gauge your risk tolerance and long-term goals.

Indeed, stocks have boomed in the past two years, but it’s a mystery what will come next. Whether we’re in for an AI-fuelled return of the “roaring 20s,” a painful valuation reset due to a comeback in inflation and interest rates, or a black swan event (nobody knew the pandemic would rattle markets back in late 2019), it’s essential to be ready to roll with the volatility as you invest in growing the wealth within your 401k.

Of course, bonds, CDs (certificates of deposit), and other investments that seemed “less risky” than stocks may deserve a spot in your 401k portfolio.

That said, if you’re looking for growth, I think it’s hard to top stocks, provided you know what you’re signing up for (a choppier ride). For someone in their 30s, I’d argue that time remains on their side as they look to position their 401k for growth in the latter half of their working life.

Sometimes, the more turbulent and rocky road forward is worth taking if it’ll get you to your destination a heck of a lot sooner. As always, reach out to a professional to ensure your contribution and investing plan are suitable for your unique set of needs.