401k advice

[davelj]

Is there a “mattress” option?

[davelj]

Is there a “mattress” option?

[Anonymous]

I have to reply to this thread. For me 401k’s have been a crock of shit, and I will give you real world examples. I think the best thing you can do is to put just enough in to maximize the Employer match. Otherwise, save your cash you can probably do better with your own IRA or savings account.

Example:

From my many years of employment, every employer switches 401k providers. My 529 for my daughter has switched accounts to fidelity from TIAA-CREF. 401k account providers switch ALL the time, this is an important note to remember.

I had roughly $10,000 in my 401k. The market tanked and one of the funds toppled. The value in my 401k went to $5,000. At this point in my career there was no employer match, so it was all my own money. The company I worked at switched 401k providers to another provider that did NOT offer the same funds. Net result was that they have to SELL my old funds and purchase equivalent funds with the new provider. I had to incur a realized loss of five thousand dollars. Where is the tax advantage there? I lost five thousand dollars pure and simple. If I start pulling money out of my 401k when I retire, can I deduct this loss? I didn’t do it myself, the company did it for me. Nearly every time this has happened I have lost money.

Plus you can exacerbate the situation if you are one of those people that actually day trades within your 401k. You can day trade yourself down to zero. Where is the tax advantage there. For me a 401k makes sense if your employer matches, to put in enough to get the match, to put in a stable fund like a bond index fund or income fund.

[Anonymous]

I have to reply to this thread. For me 401k’s have been a crock of shit, and I will give you real world examples. I think the best thing you can do is to put just enough in to maximize the Employer match. Otherwise, save your cash you can probably do better with your own IRA or savings account.

Example:

From my many years of employment, every employer switches 401k providers. My 529 for my daughter has switched accounts to fidelity from TIAA-CREF. 401k account providers switch ALL the time, this is an important note to remember.

I had roughly $10,000 in my 401k. The market tanked and one of the funds toppled. The value in my 401k went to $5,000. At this point in my career there was no employer match, so it was all my own money. The company I worked at switched 401k providers to another provider that did NOT offer the same funds. Net result was that they have to SELL my old funds and purchase equivalent funds with the new provider. I had to incur a realized loss of five thousand dollars. Where is the tax advantage there? I lost five thousand dollars pure and simple. If I start pulling money out of my 401k when I retire, can I deduct this loss? I didn’t do it myself, the company did it for me. Nearly every time this has happened I have lost money.

Plus you can exacerbate the situation if you are one of those people that actually day trades within your 401k. You can day trade yourself down to zero. Where is the tax advantage there. For me a 401k makes sense if your employer matches, to put in enough to get the match, to put in a stable fund like a bond index fund or income fund.

[Anonymous]

I have to reply to this thread. For me 401k’s have been a crock of shit, and I will give you real world examples. I think the best thing you can do is to put just enough in to maximize the Employer match. Otherwise, save your cash you can probably do better with your own IRA or savings account.

Example:

From my many years of employment, every employer switches 401k providers. My 529 for my daughter has switched accounts to fidelity from TIAA-CREF. 401k account providers switch ALL the time, this is an important note to remember.

I had roughly $10,000 in my 401k. The market tanked and one of the funds toppled. The value in my 401k went to $5,000. At this point in my career there was no employer match, so it was all my own money. The company I worked at switched 401k providers to another provider that did NOT offer the same funds. Net result was that they have to SELL my old funds and purchase equivalent funds with the new provider. I had to incur a realized loss of five thousand dollars. Where is the tax advantage there? I lost five thousand dollars pure and simple. If I start pulling money out of my 401k when I retire, can I deduct this loss? I didn’t do it myself, the company did it for me. Nearly every time this has happened I have lost money.

Plus you can exacerbate the situation if you are one of those people that actually day trades within your 401k. You can day trade yourself down to zero. Where is the tax advantage there. For me a 401k makes sense if your employer matches, to put in enough to get the match, to put in a stable fund like a bond index fund or income fund.

[Anonymous]

I have to reply to this thread. For me 401k’s have been a crock of shit, and I will give you real world examples. I think the best thing you can do is to put just enough in to maximize the Employer match. Otherwise, save your cash you can probably do better with your own IRA or savings account.

Example:

From my many years of employment, every employer switches 401k providers. My 529 for my daughter has switched accounts to fidelity from TIAA-CREF. 401k account providers switch ALL the time, this is an important note to remember.

I had roughly $10,000 in my 401k. The market tanked and one of the funds toppled. The value in my 401k went to $5,000. At this point in my career there was no employer match, so it was all my own money. The company I worked at switched 401k providers to another provider that did NOT offer the same funds. Net result was that they have to SELL my old funds and purchase equivalent funds with the new provider. I had to incur a realized loss of five thousand dollars. Where is the tax advantage there? I lost five thousand dollars pure and simple. If I start pulling money out of my 401k when I retire, can I deduct this loss? I didn’t do it myself, the company did it for me. Nearly every time this has happened I have lost money.

Plus you can exacerbate the situation if you are one of those people that actually day trades within your 401k. You can day trade yourself down to zero. Where is the tax advantage there. For me a 401k makes sense if your employer matches, to put in enough to get the match, to put in a stable fund like a bond index fund or income fund.

[Anonymous]

I have to reply to this thread. For me 401k’s have been a crock of shit, and I will give you real world examples. I think the best thing you can do is to put just enough in to maximize the Employer match. Otherwise, save your cash you can probably do better with your own IRA or savings account.

Example:

From my many years of employment, every employer switches 401k providers. My 529 for my daughter has switched accounts to fidelity from TIAA-CREF. 401k account providers switch ALL the time, this is an important note to remember.

I had roughly $10,000 in my 401k. The market tanked and one of the funds toppled. The value in my 401k went to $5,000. At this point in my career there was no employer match, so it was all my own money. The company I worked at switched 401k providers to another provider that did NOT offer the same funds. Net result was that they have to SELL my old funds and purchase equivalent funds with the new provider. I had to incur a realized loss of five thousand dollars. Where is the tax advantage there? I lost five thousand dollars pure and simple. If I start pulling money out of my 401k when I retire, can I deduct this loss? I didn’t do it myself, the company did it for me. Nearly every time this has happened I have lost money.

Plus you can exacerbate the situation if you are one of those people that actually day trades within your 401k. You can day trade yourself down to zero. Where is the tax advantage there. For me a 401k makes sense if your employer matches, to put in enough to get the match, to put in a stable fund like a bond index fund or income fund.

[Raybyrnes]

k_pip_k
Don’t like to see people lose money but I am missing the relevance of your post. Had you not put the money into the 401K you were guaranteed a tax loss that year. 10000K put into the 401 K would ahve only been 7 K you would have kept had the govenment got their hands on it.

Also with respect to losing 5000 K you would ahve lost in a traditional account aswell had you invested ina similiar fund option. Now would you get to book the loss. Sure. But 7 out of 10 times the upward drift of the market means you are going to win. So I like the fact that when I am getting dividends I am not paying taxes or filling out end of year tax forms.

It is even more important, right now being that most money managers have used up their losses from 2000 so there will be more distributions at the end of the year. So 401k gains are shelterd form this.

So all in all k_pip_k I think that maybe your strong confirmation bias agains t the 401K comes from some unfavorable selection choices inside of the 401K.

Now if you want to debate that 401K’s are bullshit because companies are paying workers lower salaries because they are Promoting (total Compensation) through 401K plans and Health savings plans etc. then that is a whole different thread.

[Raybyrnes]

k_pip_k
Don’t like to see people lose money but I am missing the relevance of your post. Had you not put the money into the 401K you were guaranteed a tax loss that year. 10000K put into the 401 K would ahve only been 7 K you would have kept had the govenment got their hands on it.

Also with respect to losing 5000 K you would ahve lost in a traditional account aswell had you invested ina similiar fund option. Now would you get to book the loss. Sure. But 7 out of 10 times the upward drift of the market means you are going to win. So I like the fact that when I am getting dividends I am not paying taxes or filling out end of year tax forms.

It is even more important, right now being that most money managers have used up their losses from 2000 so there will be more distributions at the end of the year. So 401k gains are shelterd form this.

So all in all k_pip_k I think that maybe your strong confirmation bias agains t the 401K comes from some unfavorable selection choices inside of the 401K.

Now if you want to debate that 401K’s are bullshit because companies are paying workers lower salaries because they are Promoting (total Compensation) through 401K plans and Health savings plans etc. then that is a whole different thread.

[Raybyrnes]

k_pip_k
Don’t like to see people lose money but I am missing the relevance of your post. Had you not put the money into the 401K you were guaranteed a tax loss that year. 10000K put into the 401 K would ahve only been 7 K you would have kept had the govenment got their hands on it.

Also with respect to losing 5000 K you would ahve lost in a traditional account aswell had you invested ina similiar fund option. Now would you get to book the loss. Sure. But 7 out of 10 times the upward drift of the market means you are going to win. So I like the fact that when I am getting dividends I am not paying taxes or filling out end of year tax forms.

It is even more important, right now being that most money managers have used up their losses from 2000 so there will be more distributions at the end of the year. So 401k gains are shelterd form this.

So all in all k_pip_k I think that maybe your strong confirmation bias agains t the 401K comes from some unfavorable selection choices inside of the 401K.

Now if you want to debate that 401K’s are bullshit because companies are paying workers lower salaries because they are Promoting (total Compensation) through 401K plans and Health savings plans etc. then that is a whole different thread.

[Raybyrnes]

k_pip_k
Don’t like to see people lose money but I am missing the relevance of your post. Had you not put the money into the 401K you were guaranteed a tax loss that year. 10000K put into the 401 K would ahve only been 7 K you would have kept had the govenment got their hands on it.

Also with respect to losing 5000 K you would ahve lost in a traditional account aswell had you invested ina similiar fund option. Now would you get to book the loss. Sure. But 7 out of 10 times the upward drift of the market means you are going to win. So I like the fact that when I am getting dividends I am not paying taxes or filling out end of year tax forms.

It is even more important, right now being that most money managers have used up their losses from 2000 so there will be more distributions at the end of the year. So 401k gains are shelterd form this.

So all in all k_pip_k I think that maybe your strong confirmation bias agains t the 401K comes from some unfavorable selection choices inside of the 401K.

Now if you want to debate that 401K’s are bullshit because companies are paying workers lower salaries because they are Promoting (total Compensation) through 401K plans and Health savings plans etc. then that is a whole different thread.

[Raybyrnes]

k_pip_k
Don’t like to see people lose money but I am missing the relevance of your post. Had you not put the money into the 401K you were guaranteed a tax loss that year. 10000K put into the 401 K would ahve only been 7 K you would have kept had the govenment got their hands on it.

Also with respect to losing 5000 K you would ahve lost in a traditional account aswell had you invested ina similiar fund option. Now would you get to book the loss. Sure. But 7 out of 10 times the upward drift of the market means you are going to win. So I like the fact that when I am getting dividends I am not paying taxes or filling out end of year tax forms.

It is even more important, right now being that most money managers have used up their losses from 2000 so there will be more distributions at the end of the year. So 401k gains are shelterd form this.

So all in all k_pip_k I think that maybe your strong confirmation bias agains t the 401K comes from some unfavorable selection choices inside of the 401K.

Now if you want to debate that 401K’s are bullshit because companies are paying workers lower salaries because they are Promoting (total Compensation) through 401K plans and Health savings plans etc. then that is a whole different thread.

[(former)FormerSanDiegan]

I had roughly $10,000 in my 401k. The market tanked and one of the funds toppled. The value in my 401k went to $5,000. At this point in my career there was no employer match, so it was all my own money. The company I worked at switched 401k providers to another provider that did NOT offer the same funds. Net result was that they have to SELL my old funds and purchase equivalent funds with the new provider. I had to incur a realized loss of five thousand dollars. Where is the tax advantage there?

Where is the tax disadvantage ?

Most funds have stock index funds. If you use the approach that a large chunk of your investments are in index funds, it does not matter much which company provides the 401K. It seems that your problem was an investment selection problem not a tax advantage problem.

I actually like the 401k. After 12 years it has allowed us to virtually painlessly amass about 500K for retirement. Beats relying on a single employer pension that could disappear when I’m 55.

[(former)FormerSanDiegan]

I had roughly $10,000 in my 401k. The market tanked and one of the funds toppled. The value in my 401k went to $5,000. At this point in my career there was no employer match, so it was all my own money. The company I worked at switched 401k providers to another provider that did NOT offer the same funds. Net result was that they have to SELL my old funds and purchase equivalent funds with the new provider. I had to incur a realized loss of five thousand dollars. Where is the tax advantage there?

Where is the tax disadvantage ?

Most funds have stock index funds. If you use the approach that a large chunk of your investments are in index funds, it does not matter much which company provides the 401K. It seems that your problem was an investment selection problem not a tax advantage problem.

I actually like the 401k. After 12 years it has allowed us to virtually painlessly amass about 500K for retirement. Beats relying on a single employer pension that could disappear when I’m 55.

[(former)FormerSanDiegan]

I had roughly $10,000 in my 401k. The market tanked and one of the funds toppled. The value in my 401k went to $5,000. At this point in my career there was no employer match, so it was all my own money. The company I worked at switched 401k providers to another provider that did NOT offer the same funds. Net result was that they have to SELL my old funds and purchase equivalent funds with the new provider. I had to incur a realized loss of five thousand dollars. Where is the tax advantage there?

Where is the tax disadvantage ?

Most funds have stock index funds. If you use the approach that a large chunk of your investments are in index funds, it does not matter much which company provides the 401K. It seems that your problem was an investment selection problem not a tax advantage problem.

I actually like the 401k. After 12 years it has allowed us to virtually painlessly amass about 500K for retirement. Beats relying on a single employer pension that could disappear when I’m 55.

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