2 ms·
That is all true but it still doesn't negate the fact that you should have a rainy day account and having said account has a high cost because: 1. Those 401K's
by Clubber 9y ago
That is all true but it still doesn't negate the fact that you should have a rainy day account and having said account has a high cost because:
1. Those 401K's and IRA's have a yearly cap, so anything above that cap doesn't apply.
2. Saving your "rainy day" account is a one time thing. Once you reach 4-6 months of income, you are done.
3. Like we agree, you can put it in a non-tax sheltered fund.
Also, not sure if you are going to get 8x return in 30 years. Maybe 50 years ago. When I was in college you could expect to double your money ever 7 years. I don't believe that's still the case.
- ajmurmann 9y agoI am not arguing against having a rainy day account. You should absolutely have one. I am arguing against tapping into it to take a few months off till Idaho's non-compete period expires. Over the last few years I made ~9% on my Vanguard investments. Vanguard's Retirement 2045 fund made 11% in the last 5 years and 5% in the last 10. That's all still much better than having it wast away in a money market account. You still can get the money out within days.
- Clubber 9y agoOh, most non-compete agreements I've seen are for at least a year. A rainy day fund isn't for waiting that out. A rainy day fund is so you aren't desperate enough to have to take a job that requires you to sign a non-compete like that in the first place.