|
|
|
|
Thread Tools | Display Modes |
12-29-2013, 09:52 PM | #26 |
Scooby Guru
Member#: 204578
Join Date: Mar 2009
Location: I'll see myself out
|
I think a lot of it is security as well. Contribute enough to get the match, and invest post-tax dollars in an account you have access to in an emergency, etc.
Although people don't realize the power of pre vs. post tax.
* Registered users of the site do not see these ads.
|
12-29-2013, 10:14 PM | #27 |
Scooby Newbie
Member#: 34631
Join Date: Mar 2003
Chapter/Region:
MAIC
Location: Momma Didn't Love Me
|
This is why people should do the math to see how little it really affects their net income when contributing more to a pre-tax account. Or at least be curious enough to have someone else show them the math.
|
12-29-2013, 10:20 PM | #28 | |
Add Lightness
Moderator Member#: 13699
Join Date: Dec 2001
Chapter/Region:
NESIC
Location: Hopkinton, MA
Vehicle:2021 Building It Better |
Quote:
I have been paying attention lately as I've just been lucky over the years.....aka.....moved old 401k from previous employers into rollover IRA before the 08 dive and told them to match the funds I already had (fidelity to fidelity). Well, there's no stable value fund, so for several years, I ignored it (not knowing that) and because of it, I am a financial genius. Over 50% sat in money market as the market crashed. I looked as it started coming up and got into equities of some sort. My question: I am researching and in the quest to diversify. I have most in equities: Contrafund, fidelity low price stock, S&P index fund with some in China Region, which isn't following the dow, Thompson Bond Fund, lotsa US Savings bonds, some silver physical (couple thousand). Thinking of VNQ (reit index). I want to diversify.......what else. Separate into mid cap, euro bond? Retiring within 10 years and will put 2 kids through college before then. Looking for % suggestions now along with funds/index. All with fidelity and can buy anything they sell. |
|
12-29-2013, 10:22 PM | #29 |
Scooby Newbie
Member#: 32994
Join Date: Feb 2003
Location: The woods
Vehicle:2020 BMW 330i Black |
|
12-29-2013, 10:24 PM | #30 |
Scooby Newbie
Member#: 223299
Join Date: Sep 2009
Chapter/Region:
MAIC
Location: NoVA/DC/NCR
Vehicle:2009 WRX WRB 4dr 2007 Kawasaki ZX6R |
I'm pretty sure you have more money than most people on this board.
Just be careful as you get closer to retirement age. The fact that you're still heavily Into equities within 10 years of retirement concerns me. Especially with two kids to put through school. It's kind of too late now but do you have any 529s setup for the kids? Edit: this is to Jack. |
12-29-2013, 10:25 PM | #31 |
Scooby Newbie
Member#: 223299
Join Date: Sep 2009
Chapter/Region:
MAIC
Location: NoVA/DC/NCR
Vehicle:2009 WRX WRB 4dr 2007 Kawasaki ZX6R |
The point is that actively managed funds have, generally speaking (happy SoapBox?), higher management fees without any better performance.
|
12-29-2013, 10:58 PM | #32 |
Scooby Guru
Member#: 25516
Join Date: Oct 2002
Chapter/Region:
NWIC
Location: Send help, stuck in internet!
|
Didn't Nick start an investment forum a few years ago?
I've been thinking about starting a Roth IRA. Background: I am under 30, and am putting 15% into my 401k (managed by Trow). I get an additional 8% match from my employer, in five more years that will be 10%. I live a frugal life and actively budget (YNAB), I usually have an extra $100-250 each month that I put towards my mortgage. My mortgage is at 4%, and just over 110k. According to a target calculator my current 401k balance is on track with where it should be, I also just enabled the 1% yearly increase for my 401k. I had two thoughts of how to fund an IRA 1) dropping my 401k by a few % 2) stop paying extra on my mortgage. |
12-29-2013, 10:58 PM | #33 |
Scooby Newbie
Member#: 32994
Join Date: Feb 2003
Location: The woods
Vehicle:2020 BMW 330i Black |
Well, sometimes you have to ante up if you want to invest your retirement like I do, 100% frozen concentrated orange juice futures.
|
12-29-2013, 11:02 PM | #34 |
Scooby Guru
Member#: 7887
Join Date: Jun 2001
Vehicle:2023 Tangerine 2023 3 Cylinder |
Is the max contribution of $17,500 including what your employer matches?
IBhereletmegooglethatforyou Edit: Apparently it does not. I really need to get a financial advisor. I'm great at saving but terrible at investing. I have enough saved, and at my present savings rate, that I'll have enough to pay off my house in 2 years (by the time I turn 33) and still have a nice nest egg in the bank. I have a 1 year old that I want to start saving for a college fund, but everything I've read indicates that I'm better off just maxing my 401k rather than a 529 and eating the penalties if I have to draw from it at that time. (This is assuming that I wasn't maxing my 401k, which I'm obvious not... ) Last edited by quentinberg007; 12-29-2013 at 11:09 PM. |
12-29-2013, 11:03 PM | #35 | |
Add Lightness
Moderator Member#: 13699
Join Date: Dec 2001
Chapter/Region:
NESIC
Location: Hopkinton, MA
Vehicle:2021 Building It Better |
Quote:
I know I'm somewhat standing in a trap with the market going nuts and know I should get into other hedges to a market drop. Just don't know what exactly what to do. I would research the heck out of anything, so don't be afraid to throw something at me. Another question.....I looked into doing a REIT (still looking) and found that most are stock in companies who are mostly in real estate (mall owners, building management, commercial buildings) but is it still an equity or no? I don't want to fool myself that I'm hedging by getting a real estate investment only to find its just something else that follows the Dow. |
|
12-29-2013, 11:04 PM | #36 |
Scooby Newbie
Member#: 223299
Join Date: Sep 2009
Chapter/Region:
MAIC
Location: NoVA/DC/NCR
Vehicle:2009 WRX WRB 4dr 2007 Kawasaki ZX6R |
|
12-29-2013, 11:07 PM | #37 |
Scooby Specialist
Member#: 138000
Join Date: Jan 2007
Chapter/Region:
BAIC
Location: et ament meminisse periti
Vehicle:Buy Nate's coffee west coast roasting |
|
12-29-2013, 11:08 PM | #38 |
Scooby Newbie
Member#: 32994
Join Date: Feb 2003
Location: The woods
Vehicle:2020 BMW 330i Black |
|
12-29-2013, 11:09 PM | #39 |
Scooby Specialist
Member#: 138000
Join Date: Jan 2007
Chapter/Region:
BAIC
Location: et ament meminisse periti
Vehicle:Buy Nate's coffee west coast roasting |
|
12-29-2013, 11:11 PM | #40 |
Scooby Specialist
Member#: 64196
Join Date: Jun 2004
Chapter/Region:
RMIC
Vehicle:2010 Family Sedan |
|
12-29-2013, 11:55 PM | #41 | |
Scooby Newbie
Member#: 250302
Join Date: Jun 2010
Chapter/Region:
MWSOC
Location: Shawnee, KS
Vehicle:2012 WRX Hatch Lightning Red |
Yes, they do. They match 100% up to 5% but nothing beyond. As of right now I only do the 5% because I wanted to get a lot of my student loans paid off. At the end of January I will have the majority of my student loans paid and will have extra disposable income that I would like to invest.
Quote:
Edit: I guess I should also add that I don't have any credit card debt. The only real debt I have is a mortgage and will only have a few thousand of student loans after January. Last edited by csperformance; 12-30-2013 at 12:09 AM. |
|
12-30-2013, 12:10 AM | #42 |
Scooby Specialist
Member#: 138000
Join Date: Jan 2007
Chapter/Region:
BAIC
Location: et ament meminisse periti
Vehicle:Buy Nate's coffee west coast roasting |
maybe a Roth IRA, but I dont know the details around that.
|
12-30-2013, 12:16 AM | #43 |
Scooby Specialist
Member#: 66310
Join Date: Jul 2004
Chapter/Region:
South East
Location: Removing passenger seat
Vehicle:2023 korean muscle |
So explain the math for me on putting more into my 401k
I have it set at 4% so the company will match 3.5%. This is the most they will match. I believe the max i can put into 401k is 11% I make roughly $65k how much more out of my paycheck will i miss vs the tax savings? 4% is $59 per check. 11% is $137 per check. Each check my taxable income would be $78 less. After benefits and **** i end up with 2/3 of my check. I would save the 2/3 of the $78? |
12-30-2013, 12:25 AM | #44 | |
Scooby Guru
Member#: 7887
Join Date: Jun 2001
Vehicle:2023 Tangerine 2023 3 Cylinder |
Quote:
Last edited by quentinberg007; 12-30-2013 at 12:30 AM. Reason: Clarified |
|
12-30-2013, 12:30 AM | #45 |
Scooby Specialist
Member#: 66310
Join Date: Jul 2004
Chapter/Region:
South East
Location: Removing passenger seat
Vehicle:2023 korean muscle |
Thanks qberg. I might just max it out at 11 since i already maxed my FSA at 2500. Its all going towards Lasik, just have to submit 1 bill.
Going to be a bit less in my weekly check but we have zero credit card debt and the mustang loan is 2.9% Anyone suggest i should throw everything at the loan and then max the 401k? |
12-30-2013, 12:31 AM | #46 |
Scooby Newbie
Member#: 34631
Join Date: Mar 2003
Chapter/Region:
MAIC
Location: Momma Didn't Love Me
|
Using your rough math, at 4% you're paying about a $1000 in taxes more than you would at 11%
Assuming a 22% tax rate, honestly didn't look up the rate for $65k The net income difference is $3500, but you're investing ~$4500 more a year. If putting 11% over 4% puts you in a lower tax bracket the tax savings are even greater. So far as the car loan, at 2.9% it's easy to have your money make more than that in the market = it's better to invest the money you would use to pay off the loan rather than pay off the loan. The issue that most financial advisers have, now that you already have the loan, is that people still don't use the money to invest and still just blow it on other things... why they'd usually always recommend just paying of the loan. They know otherwise the money is usually *usually* otherwise squandered. |
12-30-2013, 12:34 AM | #47 | |
Scooby Specialist
Member#: 66310
Join Date: Jul 2004
Chapter/Region:
South East
Location: Removing passenger seat
Vehicle:2023 korean muscle |
Quote:
|
|
12-30-2013, 12:38 AM | #48 |
Scooby Newbie
Member#: 34631
Join Date: Mar 2003
Chapter/Region:
MAIC
Location: Momma Didn't Love Me
|
Yup, it would "cost you" $3500 to save an extra $4500 a year.
|
12-30-2013, 12:41 AM | #49 |
Scooby Specialist
Member#: 66310
Join Date: Jul 2004
Chapter/Region:
South East
Location: Removing passenger seat
Vehicle:2023 korean muscle |
Makes sense now that someone explained it.
Thanks, now i get to explain it to the woman. |
12-30-2013, 12:43 AM | #50 |
Scooby Specialist
Member#: 138000
Join Date: Jan 2007
Chapter/Region:
BAIC
Location: et ament meminisse periti
Vehicle:Buy Nate's coffee west coast roasting |
do you have a company match?
that's a huge reason to usually edge upwards when it comes to the deferral rate. |
Thread Tools | |
Display Modes | |
|
|