also important to note: 401(k) contributions are tax-deferred, meaning you don’t pay taxes on the money now, but rather, when you take it out in retirement!
Bro really thinks a small part of his paycheck is gonna be enough to pay rent, services and buy food. Not to mention any clothes or going out sometimes. It should be the inverse, take a part of your pay check and save it for retirement
I understand why it's good to do that but how do I know I'm gonna stay in that job till I'm 59.5 years old. Or is it like a thing you can come back too when you reach that age or is it just like a all round thing so you have the 401k and that's it so it's like a bank account where companies can access it. But if you quit that job and don't retire yet would they just be stealing your money?
Biggest financial mistake I ever made was with my 401k. My company had a Roth 401k when my kids were in college, but I didn't actually start contributing until year 3 of the 6 years I had kids in college. Because I was helping them with expenses, I was entitled to the tax credits, so my effective tax rate was extremely low. That is the time you NEED to be in a roth! i still retired with about $350k in my 401k.
SCHD is by far my largest holding with my share count approaching 8000. I don’t expect more than 5% growth going forward. S&P’s historic return is closer to 9%. If SCHD matches that return we can assume 4% yield + 5% growth = 9%. We have been in an unprecedented bull cycle since SCHD’s inception (13 1/2 years). It’s not going to continue like that. We have been spoiled.
This only works if inflation is low. Otherwise, the lost buying power of said money due to inflation will negate any potential benefits from the payment of your employer. This doesn‘t mean a 401(k) is a definte bad strategy, just be aware of your countries economic situation. Taking the 10% penalty might let you end up with more buying power than letting it sit through inflation.
It’s called a pension and we all know about it but actually you get taxed on the amount and the company keeps most of it your forced to put over half your money into it over your career and when you retire you barely see any of it throughout your retirement but by bit
Can somebody please explain this. So if you do a 401k with let’s say 50% I know not likely but hypothetically let’s say that’s 50k then your company puts in extra 50k every year. You take it out at the end of the year as if it wasn’t a 401k. You have 100k in it but 10% penalized because not 59 and a half. You still get 90k. Better than the normal 50k you would get if you didn’t. If you do this with all your money say you have 100k income/year then you put 100k in 401k then company puts in 100k. Take it out at end of year like it was never in a 401k and you make 180k. Is this a loophole or is there a legal issue?
also important to note: 401(k) contributions are tax-deferred, meaning you don’t pay taxes on the money now, but rather, when you take it out in retirement!
Lucky that we don't have that in australia
I learned this is in school the other day
That is scam for you americans 😂😂😂
Your money will not have value in coming years 😜, its better you start spending it.
Winter is coming 😭 go gather some wood some paper and blankets 😂😂
Screw that im still taking the money
What if I want to quit because I got a better paying job?
Isn’t that a pension
Bro really thinks a small part of his paycheck is gonna be enough to pay rent, services and buy food. Not to mention any clothes or going out sometimes. It should be the inverse, take a part of your pay check and save it for retirement
I understand why it's good to do that but how do I know I'm gonna stay in that job till I'm 59.5 years old. Or is it like a thing you can come back too when you reach that age or is it just like a all round thing so you have the 401k and that's it so it's like a bank account where companies can access it. But if you quit that job and don't retire yet would they just be stealing your money?
Biggest financial mistake I ever made was with my 401k. My company had a Roth 401k when my kids were in college, but I didn't actually start contributing until year 3 of the 6 years I had kids in college. Because I was helping them with expenses, I was entitled to the tax credits, so my effective tax rate was extremely low. That is the time you NEED to be in a roth! i still retired with about $350k in my 401k.
You're a hardworker.
Imagine d*ing some days before 59
interest is haram
SYBAU
And recently companies will limit you to 39hrs a week instead of 40, which stops you from getting a 401k or benefits like health insurance lol
SCHD is by far my largest holding with my share count approaching 8000. I don’t expect more than 5% growth going forward. S&P’s historic return is closer to 9%. If SCHD matches that return we can assume 4% yield + 5% growth = 9%. We have been in an unprecedented bull cycle since SCHD’s inception (13 1/2 years). It’s not going to continue like that. We have been spoiled.
Is it Halal
This only works if inflation is low. Otherwise, the lost buying power of said money due to inflation will negate any potential benefits from the payment of your employer. This doesn‘t mean a 401(k) is a definte bad strategy, just be aware of your countries economic situation. Taking the 10% penalty might let you end up with more buying power than letting it sit through inflation.
So a 401k is a pension
It’s called a pension and we all know about it but actually you get taxed on the amount and the company keeps most of it your forced to put over half your money into it over your career and when you retire you barely see any of it throughout your retirement but by bit
What if I don’t get to live to age 59?
Im taking the money because I need money to live fn
Good stuff
This is assuming america has a future
Brave of this guy to think I’m living till 59, my maximum age is 26. After that it’s all over
its not the best way but its fine
402
Can somebody please explain this. So if you do a 401k with let’s say 50% I know not likely but hypothetically let’s say that’s 50k then your company puts in extra 50k every year. You take it out at the end of the year as if it wasn’t a 401k. You have 100k in it but 10% penalized because not 59 and a half. You still get 90k. Better than the normal 50k you would get if you didn’t. If you do this with all your money say you have 100k income/year then you put 100k in 401k then company puts in 100k. Take it out at end of year like it was never in a 401k and you make 180k. Is this a loophole or is there a legal issue?
Well sadly it counts as gambling am I take my religion like a restraining order. So I can't do that stuff.
What if you switch jobs?
‘Puts in life savings right before retirement’
Boss-1 million dollars in debt
Ah lovely… too bad 80% of young adults CANT afford to put on 401(k) because they are condtantly 3 seconds away from homelessness…
dies before 59
F I F T Y N I N E
That's the biggest issue with this advice. Not trying to wait until my body is halfway broken down to have some fun.
All this is broke people stuff.
This is a part time job, and i know that 401k is not transferring so give me my money