How a teenager can retire as a millionaire
Imagine a teenager opening an IRA at age 15 and contributing to it for only 10 years, then not adding another nickel. Kinniry started the account with the $3,000 minimum that Vanguard requires, then had the young worker contribute $2,000 a year for the next nine years. He would put 60 percent of the money into a broad stock portfolio and 40 percent in bonds. Kinniry ran thousands of possible market scenarios, involving good years and bad, to see how this portfolio would be likely to grow.
When the teenager is 65, the median value–half the results were higher, half lower–of the 15-to-25 retirement portfolio is $1,170,536.
The kid’s a millionaire because his portfolio had 50 years to grow.
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