Personal Finance

I'm 35 with $8 million in liquid assets and $2 million in a Roth — should I stop contributing to my 401(k)?

Maurie Backman

Published: January 16, 2025 7:14 am

Key Points from 24/7 Wall St.

• An $8 million net worth by age 35 could give you the green light to stop saving altogether.
• If you can easily afford contributions to your 401(k), you might as well make them for the tax benefits and potential matching funds.
• Think about what funding a 401(k) — or not — means for your lifestyle.
• Also: Take this quiz to see if you’re on track to retire (Sponsored)

By age 35, I was in a pretty comfortable place financially. I had a nice amount of emergency savings and a good start to my retirement nest egg.

But where I was at age 35 pales in comparison to this Reddit user, who’s that age with a very impressive $8 million in liquid assets, including a $2 million Roth account. The poster also owns their home outright (whereas I’m older than them and still have many years left on my mortgage).

They’re wondering whether it pays to keep contributing to their 401(k) plan or not. And my answer is, it depends.

It’s a matter of personal goals

If I knew for a fact that the poster in this scenario wanted to retire at a traditional age — say, sometime in their 60s — I’d say they’re probably okay to stop saving altogether at this point. With that much money by age 35, they can probably sit back and let their investments compound. And as long as they don’t touch that money, they should have a boatload of a nest egg to fall back on.

But $8 million means something different in the context of retiring at age 38 or 42 or 46. It’s still a lot of money, but there’s a difference between stretching a large nest egg 30 years versus 40 or close to 50. So for someone with $8 million by age 35 who’s looking to retire at 40, I’d say yes, maybe keep putting money into that 401(k) so you can leave your career at a very young age with less stress.

Another thing I’d urge the poster to consider, though, is whether contributing to their 401(k) negatively impacts their near-term finances. Maybe they want to leave their saved assets alone and just live on their salary for a while. If they can max out or fund a 401(k) without having to deny themselves anything, then they might as well do so to snag the tax benefits and, if applicable, matching dollars from their employer.

But let’s say that if the poster wants to leave their savings untouched, contributing to a 401(k) means not being able to take a vacation once a year. That’s ridiculous. Someone with $8 million by age 35 should not be denying themself a $10,000 or $12,000 trip because they want to leave their savings alone and are prioritizing their 401(k) over their near-term happiness.

For a 35-year-old with an $8,000 net worth, I’d say yeah, fund that 401(k) and skip the trip. You need the money in savings. But that’s not at all the situation here.

It’s best to get customized financial advice

If you’re in a position like the poster above — or even if you’re not — my best advice is to consult with a financial advisor and see what they have to say. Because everyone’s situation is unique, it’s best to work with a professional who can help you formulate a savings and investing strategy based on your personal needs and goals.

As a compromise, in the situation above, I’d probably encourage the poster to save enough in their 401(k) to snag their full employer match — mostly because I’m the type of person who hates the idea of giving up free money. However, I certainly wouldn’t push the poster to max out their 401(k) if that means giving up money to spend on things that make their life more enjoyable in the near term. Because they’ve managed to accumulate $8 million at such a young age, they’ve earned the right to indulge and worry less about savings from this point onward.