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First some advice you should take: Check out Bob Brinker (http://www.bobbrinker.com/portfolio.asp http://www.bobbrinker.com/portfolio.asp) I don't worry about

First some advice you should take: Check out Bob Brinker (http://www.bobbrinker.com/portfolio.asp http://www.bobbrinker.com/portfolio.asp) I don't worry about retirement because when I was 19 years old and working in the valley I happened to catch his radio show when he said to pull out of the market. It saved me $20,000 that's still working for me today. (The 10 year numbers might look low right now but keep in mind the Dow was DOWN 14% in that same time frame) Second some advice that's based on my semi-educated opinion: 401(k) is a scam for anyone under 50. Yes your employer might match it but even the risky portfolio of a 401(k) is usually very conservative and the guy running it usually isn't the firm's star (no one ever got rich managing a 401(k) accounts). If you're over 50 and can't afford to lose the money than go with that but if you have some time I personally think it's better to take a little risk and hopefully get a bigger reward.

brown9-2 16y ago
It's great that you were able to save $20,000 and miss out on a market decline, but why does this mean you no longer need to worry? If anything, you should take this "win" and continue to build upon it. For most people, there is no point where you've saved "enough" - more is always a good idea. Second some advice that's based on my semi-educated opinion: 401(k) is a scam for anyone under 50. This is why conventional advice is to only contribute as much to your 401(k) as to receive the employer's matching contribution, which is essentially free money. The rest of your retirement savings which you want to invest should go into an IRA, which allows you to control what exactly it is invested in.
- TomOfTTB 16y ago
  I didn't say I stopped investing but I don't have to worry because even if I don't make any more than the return I'm making now (in the worst economy on record) I'll still be making more in interest than I should be taking out (if I use around the average amount that retired people need per year).
gcheong 16y ago
The big advantage of 401k is that it is a tax deferred account which can be a good amount depending on your tax bracket. Also they don't have to be limited to just a small number of funds, some companies also provide the option to invest on your own( if this is not an option at you company, have a chat with the person running the benefit plan) and if you leave you can roll it over to a rollover IRA at any broker you want. Finally, if your company does provide a match, that is money you are essentially throwing away for what is usually a very small percentage of your salary.
- watmough 16y ago
  You have written down the generally promulgated wisdom. i.e. what you're being sold by Wall St and the Government. However, if you actually need to withdraw any of these savings ahead of time, you're looking at a 10% penalty. And who's to say that taxes won't have risen on 'fat-cat' retirees in 10 or 20 years. Why not take the (known) risk now, pay your taxes and have risk-free savings now. What about another market crash? Can you invest in property, or in metals, in a 401K? Can you avoid 2% mutual fund fees. I posted elsewhere in the thread, but think very carefully before pumping a lot of money into a 401K. 20 years is a long time for the government to keep the value of money stable, or for Wall Street to not sucker you in a crash, or for fees to T Rowe Price to eat away your nest-egg. If I had another opportunity, I'd sock 5% away in a 401K into Treasuries, and put the rest in cash and metals. There's a reason banks have vaults with gold, silver, platinum etc. Answer this question: Do you trust Wall St and the government with your money for 30 years for the small benefit of maybe a 10% tax saving, or do you actually want to maintain the control of, and the value of that money, by paying regular taxes on it now.
jfager 16y ago
This is bad advice. 401k matching is the easiest way to double your money, and tax deferral means ~30% more working for you now (when it matters, for compound growth). When you're young, the market being down just means you're getting more shares for your contribution. You're right that 401k funds tend to suck, but most funds everywhere tend to suck (compared to market). The ones that don't, you probably don't have access to. So just avoid the managed funds. Buy index, outperform most, and save the fees.

brown9-2 16y ago

It's great that you were able to save $20,000 and miss out on a market decline, but why does this mean you no longer need to worry? If anything, you should take this "win" and continue to build upon it. For most people, there is no point where you've saved "enough" - more is always a good idea. Second some advice that's based on my semi-educated opinion: 401(k) is a scam for anyone under 50. This is why conventional advice is to only contribute as much to your 401(k) as to receive the employer's matching contribution, which is essentially free money. The rest of your retirement savings which you want to invest should go into an IRA, which allows you to control what exactly it is invested in.

TomOfTTB 16y ago
I didn't say I stopped investing but I don't have to worry because even if I don't make any more than the return I'm making now (in the worst economy on record) I'll still be making more in interest than I should be taking out (if I use around the average amount that retired people need per year).

gcheong 16y ago

The big advantage of 401k is that it is a tax deferred account which can be a good amount depending on your tax bracket. Also they don't have to be limited to just a small number of funds, some companies also provide the option to invest on your own( if this is not an option at you company, have a chat with the person running the benefit plan) and if you leave you can roll it over to a rollover IRA at any broker you want. Finally, if your company does provide a match, that is money you are essentially throwing away for what is usually a very small percentage of your salary.

watmough 16y ago
You have written down the generally promulgated wisdom. i.e. what you're being sold by Wall St and the Government. However, if you actually need to withdraw any of these savings ahead of time, you're looking at a 10% penalty. And who's to say that taxes won't have risen on 'fat-cat' retirees in 10 or 20 years. Why not take the (known) risk now, pay your taxes and have risk-free savings now. What about another market crash? Can you invest in property, or in metals, in a 401K? Can you avoid 2% mutual fund fees. I posted elsewhere in the thread, but think very carefully before pumping a lot of money into a 401K. 20 years is a long time for the government to keep the value of money stable, or for Wall Street to not sucker you in a crash, or for fees to T Rowe Price to eat away your nest-egg. If I had another opportunity, I'd sock 5% away in a 401K into Treasuries, and put the rest in cash and metals. There's a reason banks have vaults with gold, silver, platinum etc. Answer this question: Do you trust Wall St and the government with your money for 30 years for the small benefit of maybe a 10% tax saving, or do you actually want to maintain the control of, and the value of that money, by paying regular taxes on it now.

jfager 16y ago

This is bad advice. 401k matching is the easiest way to double your money, and tax deferral means ~30% more working for you now (when it matters, for compound growth). When you're young, the market being down just means you're getting more shares for your contribution. You're right that 401k funds tend to suck, but most funds everywhere tend to suck (compared to market). The ones that don't, you probably don't have access to. So just avoid the managed funds. Buy index, outperform most, and save the fees.