401k contribution - Yay or Nay

[Raido Free America]

Too many folks getting caught up looking at a 401 or other investment based retirement account as a pile of money rather than a pile of shares. The monetary value of anything comes and goes --- in the case of stocks, it pretty well always trendlines up over time. That's why the SPOT value is less important than the shares. Personally I evaluate my 401k maybe once every year for the 3 and 5 year performance of the funds. I know I'm not retiring anytime soon so it's not like drops bother me in the least. That's not to say I don't have non-investment value streams to diversify.

IIRC the worst drop in history was the Black Friday crash, and the market didn't recover there for about 20 years. But, it did recover and has grown "slightly" since then.

There are only two things we all need to be able to control, to be sucessful investers in anything! FEAR, AND GREED!

 

[joegrizzy]

There are only two things we all need to be able to control, to be sucessful investers in anything! FEAR, AND GREED!

lol fear and greed *are the driving forces behind an economy that is built around monetized debt*.

i can't believe no one understands this.

>but it's okay tho, *i have money!*

 

[Raido Free America]

One potential benefit of having a 401k, that I have not seen mentioned here is, when your balance gets substantial, most programs allow you to borrow up to 50%, or what ever their limit is, from YOURSELF! Then you pay your payments , including interest, back into YOUR 401k account! There is a small paperwork fee, but other than that, YOU pay all that interest to yourself, instead of some bank! WARNING, don't take money out of your 401k! By the time you pay the 10% penalty, than state and federal income taxes on this money, and add this amount to your regular income amount, that could put you in a higher tax bracket, it could cost you 50% of what you kook out!

 

[Letfreedomring]

 

[OKRuss]

One potential benefit of having a 401k, that I have not seen mentioned here is, when your balance gets substantial, most programs allow you to borrow up to 50%, or what ever their limit is, from YOURSELF! Then you pay your payments , including interest, back into YOUR 401k account! There is a small paperwork fee, but other than that, YOU pay all that interest to yourself, instead of some bank! WARNING, don't take money out of your 401k! By the time you pay the 10% penalty, than state and federal income taxes on this money, and add this amount to your regular income amount, that could put you in a higher tax bracket, it could cost you 50% of what you kook out!

While this does exist, taking a loan against your 401K is a HORRIBLE idea! Unless there's a catastrophic reason, leave it alone. What old John doesn't mention is the market increases that you miss out on. Prior to the pandemic, the DOW has a lifetime average return around 10%. Keeping it to a round number for ease in discussing.

If your 401K charges 5% for the loan and you lose 10% by not being in the market, you in effect have a 15% interest rate on your loan. BAD IDEA!

Not taking money OUT of your 401K due to penalties and such, GOOD IDEA!

 

[bigfug]

pretty sure i've been hearing people losing 20% or so on 401k.

i think next year will be worse imo. 10% inflation isn't going away any time soon without MAJOR uh what do they call them....oh yeah "corrections".

You'd have to lose more than 60% before you actually take a loss vs what you would have put in your pocket not contributing, and actually gaining more than 6% since its a pre-tax deduction. Lets say for easy math 6% is $100 a pay period, if you didnt contribute, after withholdings, your looking at roughly $68-70 bucks in your check. But if you did, your 401k has $200 in it, so you're 401k would have to lost $120-130 before it equals your take home, but also remember that your adjusted gross income, or taxable income is lower as well. Only way you're losing on a 401k is a depression or EOTW type event. If the market is bad enough that people are lossing 60+% in the market, we are all screwed no matter where we put our money.

 

[jakeman]

While this does exist, taking a loan against your 401K is a HORRIBLE idea! Unless there's a catastrophic reason, leave it alone. What old John doesn't mention is the market increases that you miss out on. Prior to the pandemic, the DOW has a lifetime average return around 10%. Keeping it to a round number for ease in discussing.

If your 401K charges 5% for the loan and you lose 10% by not being in the market, you in effect have a 15% interest rate on your loan. BAD IDEA!

Not taking money OUT of your 401K due to penalties and such, GOOD IDEA!

Borrowing from your 401k is the stupidest **** ever. It's worse than making a withdrawal.

 

[jakeman]

While this does exist, taking a loan against your 401K is a HORRIBLE idea! Unless there's a catastrophic reason, leave it alone. What old John doesn't mention is the market increases that you miss out on. Prior to the pandemic, the DOW has a lifetime average return around 10%. Keeping it to a round number for ease in discussing.

If your 401K charges 5% for the loan and you lose 10% by not being in the market, you in effect have a 15% interest rate on your loan. BAD IDEA!

Not taking money OUT of your 401K due to penalties and such, GOOD IDEA!

You'd have to lose more than 60% before you actually take a loss vs what you would have put in your pocket not contributing, and actually gaining more than 6% since its a pre-tax deduction. Lets say for easy math 6% is $100 a pay period, if you didnt contribute, after withholdings, your looking at roughly $68-70 bucks in your check. But if you did, your 401k has $200 in it, so you're 401k would have to lost $120-130 before it equals your take home, but also remember that your adjusted gross income, or taxable income is lower as well. Only way you're losing on a 401k is a depression or EOTW type event. If the market is bad enough that people are lossing 60+% in the market, we are all screwed no matter where we put our money.

I don't see the actual posts, but I can see the posters. I can tell by your responses about what was said, so I'll give you gents a little tip; you're wasting your time.

 

[joegrizzy]

I don't see the actual posts, but I can see the posters. I can tell by your responses about what was said, so I'll give you gents a little tip; you're wasting your time.

i dunno.
let's start simple:
do you support the progressive liberal elite who use their outreach and influence to push left wing causes such as "trans kids", the idea that guns are evil, or that any black man who dares name them instantly deserves to die a pennyless slave?

if not; why give them your money?

and the answer to that question even simpler: because you want money and value it above anything else.

will you take a few extra thousand in your bank account at the expense of losing your son's penis? this is a REAL question.

 

[joegrizzy]

If you go BDS, you realize you can't really....own much.