What If You Simply Maxed Out Retirement Accounts for 45 Years?

Most people don’t fall short financially because they lack ambition — they fall short because no one ever helped them connect earning, saving, investing, and planning into one clear system.

That’s exactly what Savings Coach exists to do. We help clients earn more so they can save more. We encourage consistent saving habits. We guide how those savings are invested using smart, tax-efficient strategies. And just as importantly, we become your accountability partner — we monitor progress regularly and help mitigate the risks that could derail long-term success.

To show why this approach matters, consider the following thought experiment.

The Thought Experiment

What if someone started at age 21 and did one very simple thing every year until age 65: 

Maxed out their 401(k) at $24,500 per year 

Let’s assume a few things:

• No employer match

• No increases in contribution limits

• No fancy strategies

• Just consistent investing for 45 years

That’s $24,500 per year invested every year. Over 45 years, the total amount contributed would be:

$1,102,500. The current tax laws are designed to allow everyone to become a millionaire!

But this is just the principle that you are putting in — the real story is what happens after returns are applied. Let’s learn about compounding – aka more math!

What the Returns Do (This Is the Part People Underestimate)

Below is what that same contribution strategy turns into at different long-term annualized returns by age 65:

Some of these numbers are just silly, but it’s math. Your $1,102,500 in savings can grow into the numbers above depending on compounding rates of returns during your working lifetime. Think of compounding interest as your wealth multiplier. 

The difference between a conservative 6–7% return and a more aggressive 9–10% return isn’t a few hundred thousand dollars — it’s tens of millions over a lifetime for the SAME $1.1M invested. 

The Quiet Power of Starting at 21

So if we just do what the U.S. government is incentivizing us to do, we all have the opportunity to become millionaires. The two factors become: (1) for how long? And (2) at what rate of return.

Let’s focus on time. 

In the early years, progress feels painfully slow. After 10 years of investing, even at decent returns, the balance doesn’t look life-changing. 

At 6% compounding, you will have contributed $320,000 and your balance would be $342,305. At 10% the balance would be $429,514.

That’s where most people get discouraged.

But somewhere in your late 30s and early 40s, the curve starts to bend.

In your 50s and 60s, growth begins to outpace contributions — even though you’re still investing the same $24,500 per year.

That’s compounding finally doing what it’s designed to do.

A Reality Check (And a Reframe)

Very few people will actually max out both accounts starting at 21. That’s real life.

But this exercise isn’t about perfection — it’s about perspective. If:

• You start earlier than most

• You increase contributions gradually

• You stay invested through market cycles

• You use tax-advantaged accounts intentionally

You don’t need a perfect plan to end up with extraordinary results. Let time do the heavy lifting. This is how ordinary decisions create extraordinary outcomes.

If interested, see the tables below for the raw numbers. Assume an individual, age 21 contributes $24,500 into a 401K every year and $7,500 into a traditional IRA every year.

The tables are as follows: 

1. The 401K balance if invested at various rates of return

2. The contributions per year and cumulative contributions per year