Rich Man, Poor Man Tables

The following is the table used in Richard Russell’s timeless piece “Rich Man, Poor Man.

Rich Man, Poor Man

 Investor A Investor B 
AgeContributionYear End ValueContributionYear End Value
192,0002,200
202,0004,620
212,0007,282
222,00010,210
232,00013,431
242,00016,974
252,00020,872
262,0002,200-22,959
272,0004,620-25,255
282,0007,282-27,780
292,00010,210-30,558
302,00013,431-33,614
312,00016,974-36,976
322,00020,872-40,673
332,00025,159-44,741
342,00029,875-49,215
352,00035,062-54,136
362,00040,769-59,550
372,00047,045-65,505
382,00053,950-72,055
392,00061,545-79,261
402,00069,899-87,187
412,00079,089-95,905
422,00089,198-105,496
432,000100,318-116,045
442,000112,550-127,650
452,000126,005-140,415
462,000140,805-154,456
472,000157,086-169,902
482,000174,995-186,892
492,000194,694-205,581
502,000216,364-226,140
512,000240,200-248,754
522,000266,420-273,629
532,000295,262-300,992
542,000326,988-331,091
552,000361,887-364,200
562,000400,276-400,620
572,000442,503-440,682
582,000488,953-484,750
592,000540,049-533,225
602,000596,254-586,548
612,000658,079-645,203
622,000726,087-709,723
632,000800,896-780,695
642,000883,185-858,765
652,000973,704-944,641
Less Total Invested:(80,000)(14,000)
Net Earnings:893,704930,641
Money Grew:11-fold66-fold

 

Here’s what the numbers look like assuming current IRA contribution limits and a 7% annual rate of return rather than Russell’s assumed 10%. Note that Investor B has to contribute to age 29 rather than 25 in this scenario. Still, it beats having to contribute to age 65!

Rich Man, Poor Man Assuming $5,500 Contributions and a 7% Return

 Investor A Investor B 
AgeContributionYear End ValueContributionYear End Value
195,5005,885
205,50012,182
215,50018,920
225,50026,129
235,50033,843
245,50042,097
255,50050,929
265,5005,8855,50060,379
275,50012,1825,50070,490
285,50018,9205,50081,310
295,50026,1295,50092,886
305,50033,843-99,389
315,50042,097-106,346
325,50050,929-113,790
335,50060,379-121,755
345,50070,490-130,278
355,50081,310-139,398
365,50092,886-149,155
375,500105,274-159,596
385,500118,528-170,768
395,500132,710-182,722
405,500147,884-195,512
415,500164,121-209,198
425,500181,495-223,842
435,500200,084-239,511
445,500219,975-256,277
455,500241,258-274,216
465,500264,032-293,411
475,500288,399-313,950
485,500314,472-335,927
495,500342,370-359,441
505,500372,221-384,602
515,500404,161-411,524
525,500438,337-440,331
535,500474,906-471,154
545,500514,034-504,135
555,500555,902-539,425
565,500600,700-577,184
575,500648,634-617,587
585,500699,923-660,818
595,500754,803-707,076
605,500813,524-756,571
615,500876,356-809,531
625,500943,586-866,198
635,5001,015,522-926,832
645,5001,092,493-991,710
655,5001,174,853-1,061,130
Less Total Invested:(220,000)(60,500)
Net Earnings:954,8531,000,630
Money Grew:4-fold17-fold

 

And finally, here’s the same table assuming a 5% annual rate of return. Here, Investor B has to continue contributing until age 32. The lower the return, the more you have to contribute to reach the same final nest egg. That’s just basic math. But the lesson is the same: It pays to start early.

Rich Man, Poor Man Assuming $5,500 Contributions and a 5% Return

 Investor A Investor B 
AgeContributionYear End ValueContributionYear End Value
195,5005,775
205,50011,839
215,50018,206
225,50024,891
235,50031,911
245,50039,281
255,50047,020
265,5005,7755,50055,146
275,50011,8395,50063,678
285,50018,2065,50072,637
295,50024,8915,50082,044
305,50031,9115,50091,921
315,50039,2815,500102,292
325,50047,0205,500113,182
335,50055,146-118,841
345,50063,678-124,783
355,50072,637-131,022
365,50082,044-137,574
375,50091,921-144,452
385,500102,292-151,675
395,500113,182-159,259
405,500124,616-167,222
415,500136,622-175,583
425,500149,228-184,362
435,500162,465-193,580
445,500176,363-203,259
455,500190,956-213,422
465,500206,279-224,093
475,500222,368-235,297
485,500239,261-247,062
495,500256,999-259,415
505,500275,624-272,386
515,500295,180-286,006
525,500315,714-300,306
535,500337,275-315,321
545,500359,914-331,087
555,500383,684-347,642
565,500408,644-365,024
575,500434,851-383,275
585,500462,368-402,439
595,500491,262-422,560
605,500521,600-443,688
615,500553,455-465,873
625,500586,903-489,167
635,500622,023-513,625
645,500658,899-539,306
655,500697,619-566,271
Less Total Invested:(220,000)(77,000)
Net Earnings:477,619489,271
Money Grew:2-fold6-fold