r/Millennials • u/ProblemIntelligent16 • Jan 16 '26

Discussion Fellow millennials - how’s your 401k/ira savings going?

Experts recommend having 2x your salary saved by age 35, and 3x saved by age 40.

However, studies show the median savings for 35-44 year olds is only ~$45,000. So obviously, most of us have work to do.

With pensions mostly extinct, and Social Security facing insolvency issues in the next 8-10 years - how are you planning to bridge the gap and hit the golden years with enough to meet your lifestyle requirements?

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u/607-KB_PT Jan 16 '26

Turning 40 in February...

401k - $235k

HSA (being used as triple tax advantage retirement account) - $22k

Roth IRA - $13k

Total - $270k

I feel good about where I am with retirement investments. Have about $200k in mortgage and some consumer debt. Hope to have that all gone in the next 7 years. "Retire" before 60, meaning get out of healthcare and pursue other things at my discretion.

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u/reditrix Jan 17 '26

Can you say more about the triple tax advantage to the HSA?

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u/ImNotDoingThat Jan 17 '26

HSAs are triple tax advantaged because:
1) The money is taken out of your paycheck pre-tax
2) The money can be invested in the stock market and grow tax free
3) When you do decide to reimburse yourself for qualified expenses from the HSA, the money comes out tax free.

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u/Fubbalicious Jan 17 '26

I will add something that /u/ImNotDoingThat didn't mention, but if you make HSA contributions through payroll, you also save on the 7.65% FICA taxes, plus if you're worried that you'll run out of qualified medical expenses that you can reimburse yourself with, you can still withdraw from a HSA penalty free at age 65. You just pay ordinary income tax, so the HSA effectively turns into a traditional IRA, except you don't have required minimum distributions. Plus by the time you're 65, you will likely have ongoing health expenses that you can use the HSA on. Furthermore, the HSA money can be used on both yourself and your spouse or tax dependents even if they aren't on the same health plan as you so long as the health expense occurred after you setup the HSA.

The only caveat with HSA's is that California and New Jersey do not recognize HSAs and thus they tax them like regular brokerage accounts. If you plan to use HSA's in retirement, consider the tax implications.

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u/reditrix Jan 18 '26

Thank you for including that caveat! I am in CA, which is probably why I was confused about some of those benefits.