Finance and Economics > Investing and Saving

Increasing 401k

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Stein:

--- Quote from: DarkEyes on October 11, 2008, 04:39:40 PM ---I've had to borrow a tin foil hat to post this, but do you think it's possible that with the way things are going, we could be headed down a road that is going to take us someplace we've never been before?  Have you thought that you might be throwing your money out the window?  For the time being, I have stopped my 401 contribution, haven't taken any money out of it, but with the money that would have been my contribution, I've been buying silver coins.

--- End quote ---

It's possible, but I have decided to stay put with the 401(k) for several important reasons, roughly in order of importance.

1.  If I pulled it out and got it in cash or silver/gold, it wouldn't be enough to secure much of a life outside 6 months to a year.  I have emergency cash readily available for 6 months already ala Dave Ramsey.  Thus, it isn't a solution.

2.  I am still getting a 100% match up to 4% from my employer so I am actually still in the positive when I look at only money I have contributed.

3.  If everything somehow comes out alright, I don't want to shortchange my future (I try for win/win strategies if at all possible).

4.  Paying that tax would make me want to puke.

ModernSurvival:
Stein,  I would never suggest anyone withdraw early, what Serellen did was stop his contributions for now.  My view (I am not an advisor, yadda, yadda) is many don't have sufficient plain old savings in cash.  You should have 3-6 months of household expenses in cash you can get to easily at minimum.  Once that is done you worry about 401s, SEPs, IRAs, etc.

Everyone has to make their own choices but pulling our of a tax deferred account before retirement age should be a last ditch thing.  The penalties and taxes are insane,

Stein:
Yeah, until O-bummer puts through his bill to allow people to drain their 401(k)s.  I guess draining our homes of value isn't enough.

Sorry, just a bit angry that a presidential candidate would suggest to the masses that he is going to help them by giving them easy access to the last bastion of money available to most people.

Besides, if you sell you can't have fun on the roller coaster these days.

ModernSurvival:
Allowing people to raid 401Ks = full all out run on the market = death nail to the Dow, S&P and NASDAQ = Destruction of the U.S. economy. 

Of course this is the same jack ass that thinks raising taxes during a recession is a good idea, last idiot to do that was Herbert Hover!  You do remember what that caused right?

GroundPounder:
I am not an adviser either (bla,bla, bla) but I believe in dollar cost averaging.  Just keep putting some in every month.  Sometimes you buy high, sometimes low but over time you will do well.  Things seem pretty bleak now, but we will get through it.  If you sold your stocks at the market bottom in September of 1998 when the Dow was at 7539.07, you would have missed out on portfolio gains of 21.8 percent by the end of that year. 

Yes, this time is probably worse than 1998, but remember the ant that collects a little food every day.  Be diversified in your investments.  Over time you can buy stocks, mutual funds, metals, land, real estate, etc.  Just remember that building wealth takes time.

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