Mother effer....got robbed

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RavenSEAL

Diamond Member
Jan 4, 2010
8,661
3
0
don't believe it, i doubt the OP is stupid enough to withdraw from his 401k in the first place.
 
T

trmiv

Lifer
Oct 10, 1999
14,670
18
81
One of the better parody threads in recent memory.

A+++++++ would read again.
 
DrPizza

DrPizza

Administrator Elite Member Goat Whisperer
Mar 5, 2001
49,601
167
111
www.slatebrookfarm.com
rcpratt said:
401k withdrawals are subject to a 10% penalty beyond being pre-tax dollars.

An alternative is to take a loan from your 401k, up to half of the balance. That will hurt your long-term savings, though.
Click to expand...

You've missed my point - instead of putting $1000 into a savings account (that earns 1% interest), if you haven't already maxed out your 401k, why not stick the extra $1000 into the 401k. Actually, though, since they're pre-tax dollars, you're sticking $1100 into the 401k and still having the same amount of take-home income. When you need the cash, I'm not saying to withdraw half of your 401k; of course that would have a negative impact on your retirement interest. I'm suggesting that you withdraw that extra $1000 that you wouldn't have otherwise put in there. Actually, you end up with more in there than you would have put into the bank, since they are pre-tax dollars. Provided you pay the money back, you don't pay a penalty. You have to pay interest, but you're paying interest to yourself. Unless it's the case that you would have taken the $1000 out of your savings account and never saved another penny, then it seems you would be paying back that "loan" to yourself.
 
BoomerD

BoomerD

No Lifer
Feb 26, 2006
66,395
14,792
146
Fucker...you got me for a minute...it felt like a parody, but I just couldn't figure out...ah shit...who has been bragging about $1000...NOW it makes sense.

:thumbsup:
Nicely played.
 
Juked07

Juked07

Golden Member
Jul 22, 2008
1,473
0
76
DrPizza said:
You've missed my point - instead of putting $1000 into a savings account (that earns 1% interest), if you haven't already maxed out your 401k, why not stick the extra $1000 into the 401k. Actually, though, since they're pre-tax dollars, you're sticking $1100 into the 401k and still having the same amount of take-home income. When you need the cash, I'm not saying to withdraw half of your 401k; of course that would have a negative impact on your retirement interest. I'm suggesting that you withdraw that extra $1000 that you wouldn't have otherwise put in there. Actually, you end up with more in there than you would have put into the bank, since they are pre-tax dollars. Provided you pay the money back, you don't pay a penalty. You have to pay interest, but you're paying interest to yourself. Unless it's the case that you would have taken the $1000 out of your savings account and never saved another penny, then it seems you would be paying back that "loan" to yourself.
Click to expand...

People ignore good options if they're complicated.
 
rudeguy

rudeguy

Lifer
Dec 27, 2001
47,351
14
61
Perknose said:
That's because rudeguy's real life makes you believe the OP's premise. Think about it. ;)
Click to expand...

a good parody has to have a bit of truth, a bit of fiction and must refer to Trident as an underweight 12 year old girl.
 
rcpratt

rcpratt

Lifer
Jul 2, 2009
10,433
110
116
DrPizza said:
You've missed my point - instead of putting $1000 into a savings account (that earns 1% interest), if you haven't already maxed out your 401k, why not stick the extra $1000 into the 401k. Actually, though, since they're pre-tax dollars, you're sticking $1100 into the 401k and still having the same amount of take-home income. When you need the cash, I'm not saying to withdraw half of your 401k; of course that would have a negative impact on your retirement interest. I'm suggesting that you withdraw that extra $1000 that you wouldn't have otherwise put in there. Actually, you end up with more in there than you would have put into the bank, since they are pre-tax dollars. Provided you pay the money back, you don't pay a penalty. You have to pay interest, but you're paying interest to yourself. Unless it's the case that you would have taken the $1000 out of your savings account and never saved another penny, then it seems you would be paying back that "loan" to yourself.
Click to expand...
But that $1000 that you put in the 401k would still be, essentially, untouchable until you retire. Yes, you can borrow it, but you must always pay it back to the 401k. I guess it depends on what (and when) you were planning on using that savings account money for in the first place.

Depending on the difference between your 401k return and savings account return, it wouldn't be a terrible idea just to withdraw it, anyways. If your 401k was 5% and savings 1%, you could net a profit on money withdrawn from the 401k after less than 3 years, even after the 10% penalty.
 
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