401k contribution - Yay or Nay

[El Pablo]

You can't really be this stupid.

I expect he will prove you wrong, you’ve not seen anything yet.

 

[joegrizzy]

You can't really be this stupid.

you know i find myself saying that every day. but probably not in the way you think.

 

[THAT Gurl]

You can't really be this stupid.

I spit diet Coke EVERYWHERE! God knows I love reading his posts but ... Uhmmm ... Well ... Dang!!

 

[emapples]

Waiting until the price goes up to buy?

Precisely

 

[Rez Exelon]

Really only a loss is when you sell or cash out, if you don't sell or do anything value may increase by $50000 in ten years. if you look at history it will come back

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.

 

[okietool]

I contributed as did the wife and many friends.
Yea you take hits some years but my 17,000 that I made in 9 years and then rolled over into an IRA after I quit back in 2020 is now worth over 65,000 and I have not put a penny in it since.
This last drop hurt it a little as it was up to 86,000.


My friend that works for OGE has over 1 million in his 401K.
Another buddy borrows against his 401K to buy houses and pays himself back.
All his houses are paid for and not a single one worth less than 140,000.

I only put in as much as the employer would match like your 6% but i also claimed 14 dependents to get a lot on my check and used that money to pay off my houses quick.

Yea I paid in at the end of the year because I only had a wife and 2 kids but it all evens out.
The savings I made on knocking those payments out was super beneficial.

I did not even know about Dave Ramsey i just know math.

You should always pay in at the end of the year.

If you have any match you need to get it. That gives you 100% profit plus how ever much tax you don’t pay. Say 18% fed and 6.5% Ok Tgat ups it to 125% from day one. So even if your 401K is down 50% you haven’t lost money.
Plus if you can get anything in a Roth account do it.
The drawback to 401ks in my case was a very limited assortment of funds.
Now that I’m out so are index funds. I’m in managed stuff now.
That and metals and commodities.

 

[El Pablo]

You should always pay in at the end of the year.

If you have any match you need to get it. That gives you 100% profit plus how ever much tax you don’t pay. Say 18% fed and 6.5% Ok Tgat ups it to 125% from day one. So even if your 401K is down 50% you haven’t lost money.
Plus if you can get anything in a Roth account do it.
The drawback to 401ks in my case was a very limited assortment of funds.
Now that I’m out so are index funds. I’m in managed stuff now.
That and metals and commodities.

I can invest in that if I wanted in my 401k. My biggest issue with 401k is your employer picks the plan. So if they pick a crappy one…

I try to front load my 401k at the start of the year. I’d rather get the extra time in.

I max out iras when I’m allowed at the end of the tax period, which is bonus time where I work.

 

[harley128]

You should always pay in at the end of the year.

If you have any match you need to get it. That gives you 100% profit plus how ever much tax you don’t pay. Say 18% fed and 6.5% Ok Tgat ups it to 125% from day one. So even if your 401K is down 50% you haven’t lost money.
Plus if you can get anything in a Roth account do it.
The drawback to 401ks in my case was a very limited assortment of funds.
Now that I’m out so are index funds. I’m in managed stuff now.
That and metals and commodities.

You mistakenly imply that he's getting out of paying taxes. Remember, that tax is only deferred.

 

[emapples]

I’ve lost close to $10000 over this last year. People can say what they want but I am only putting in 1% right now. If things get better I will bump it back up. I take things day to day. I may not be here another second on this earth.

Do the math, if your company is matching your input you are still gaining? The marked is down like 25%? If you put in 5000 and they put in 5000, thats 10,000 less 25% thats 7500 (still more that than the 5000 top put in?). If your 401K allows you to rebalance you rebalance into the lest volatile stuff for your nest egg and keep you contributions in the volatile stuff, then in 6 months rebalance back into the volatiles stuff. I have most of mine transferred into ira’s with about 10% in a current 401k. So with an IRA its really easy you can sit in cash as I am now , but always take the free matching money from your employer It part of your payment package. Some companies even add more to the 401k on a profit sharing system.

 

[Raido Free America]

yeah i mean frankly rich old people don't have it much better than poor old people. wealth is only worth it when you are young.

Rich old people don't have to try and work at Walmart, on walkers, or make a decision between medication they need, and food! We are far from rich, but we are comfortable, and had every toy anybody else did when young! The difference is making finacancl decisions with the head, not the enmtions, and avoiding bad deals on everything, including toys!