Take 401k and pay off home

[2506]

I see your points. One thought. Have you ever known a person who ought gold 25 years ago for 25.00 an ounce? People would pile on them saying that's a piss poor investment. It grows to slow. Well,,,,,, ask that guy how life is today.
For those who say, my portfolio is back to where it was from the 2001 tank. That's a long time to rebound. That's a lot of interest payments. I have a 5.4% interst rate on the home. And I really see the market tanking.
I know my thoughts are very unpopular. I get it.
But sometimes that's how great ideas start.
If the dollar value keeps falling, and it will, that 401k ain't worth bubblegum in 20 years. Cause you will NEVER EVER see another republican president. Mark my words.

You may want to use your google machine and lookup stock market performance vs presidential party affiliation. Most investment strategies use past performance to anticipate future gains. Stocks do not favor republican administrations, FWIW.

 

[oknow]

Bull market, lower your contributions, Bear market, up them, Pay extra on your house every month to build equity and pay less interest. Put away some food, water, ammo, etc. Plan for as many contingencies as possible (even non collapse). Never go all in on anything. Don't listen to anyone who says they are "certain" of anything, they are full of bubblegum....no disrespect intended.

If they are certain they are either doing insideder trading or they are full of bubblegum I don't care if they are disrespected or not.

 

[Oregonhunter5]

You may want to use your google machine and lookup stock market performance vs presidential party affiliation. Most investment strategies use past performance to anticipate future gains. Stocks do not favor republican administrations, FWIW.

Your the other side of the tracks vs. Burt.
If you think we should put stock in the future of the economy, when folks like barrack are in charge, so be it. Not me. I'm am surrounded by VERY seasoned wealthy people in my family. They are experts in the market. They predict a big fall coming. But, they don't really agree with the idea of using the 401k though to pay off house. I think there is great value to getting the lowest interest rate on the house, and moving the investments to safe bets. Then when the dollar falls even lower, the low interest rate rocks.

 

[slimmer13]

Sounds like you have made up your mind. Why are you asking us?

 

[2506]

Your the other side of the tracks vs. Burt.
If you think we should put stock in the future of the economy, when folks like barrack are in charge, so be it. Not me. I'm am surrounded by VERY seasoned wealthy people in my family. They are experts in the market. They predict a big fall coming. But, they don't really agree with the idea of using the 401k though to pay off house. I think there is great value to getting the lowest interest rate on the house, and moving the investments to safe bets. Then when the dollar falls even lower, the low interest rate rocks.

The S&P 500 has gained over 12% per year since Barry took office. Regardless of how you may FEEL he is handling the economy, you're missing the boat. But it sounds to me like you and your wealthy, seasoned investor friends should put your money in your mattresses and sleep well at night.

 

[Oregonhunter5]

He who builds a house on a sandy foundation, will soon see why that's a bad idea.
Or something like that.

 

[Stomper]

The S&P 500 has gained over 12% per year since Barry took office. Regardless of how you may FEEL he is handling the economy, you're missing the boat. But it sounds to me like you and your wealthy, seasoned investor friends should put your money in your mattresses and sleep well at night.

That 12% "increase" is an illusion caused by the propping up via "quantitative easing" from The Fed.

Just wait until the toilet paper they're printing all that "money" with runs out... math doesn't lie.

 

[ZigZagZeke]

In 2001 I had a few thousand dollars left in an old 401k after giving most of it (6 figures) to my ex in order to get her to pretend we never met. I left that employer in 2001, and I transferred that money to a self-directed IRA at E-trade. In 2003 I put all of it into a failing computer company called Apple at $7.50 per share. With a little judicious trading now and then, and a basic buy and hold strategy I'm now 4000% ahead. In 2008 Apple went from $200 to $78 per share. I held onto what I had and bought more. Last year it dropped from $700 to $380. I bought a bunch at $400. It's now hanging out around $500 a share. Over the years, being over 59-1/2, I've sold a little here and there when the price was up and taken a few distributions. I've used the proceeds to put the wife through college, go on vacations, buy guns, an RV and boat, all for cash.

Or I could have taken a 50% tax hit, paid off the 5% mortgage and have zero savings. Compare 5% to 4000% on that money. Get the picture?

 

[MrNiceGuy]

In 2001 I had a few thousand dollars left in an old 401k after giving most of it (6 figures) to my ex in order to get her to pretend we never met. I left that employer in 2001, and I transferred that money to a self-directed IRA at E-trade. In 2003 I put all of it into a failing computer company called Apple at $7.50 per share. With a little judicious trading now and then, and a basic buy and hold strategy I'm now 4000% ahead. In 2008 Apple went from $200 to $78 per share. I held onto what I had and bought more. Last year it dropped from $700 to $380. I bought a bunch at $400. It's now hanging out around $500 a share. Over the years, being over 59-1/2, I've sold a little here and there when the price was up and taken a few distributions. I've used the proceeds to put the wife through college, go on vacations, buy guns, an RV and boat, all for cash.

Or I could have taken a 50% tax hit, paid off the 5% mortgage and have zero savings. Compare 5% to 4000% on that money. Get the picture?

My uncle has a story just like that... only it was his rent money that he spent on lottery tickets and won something like $50k.
It makes for a good story, but it's not exactly repeatable nor is it any indication of the results one should expect.
In the end, it's all just gambling.

If you could repeat it and knew of a stock that would DEFINITELY give gigantic returns, you wouldn't need e-trade. You'd own e-trade. You could call it ZigZagZeke-trade and we'd all be members.

 

[Oregonhunter5]

So who's the next apple or google?
That's the issue.
It's luck a lot of the time.

 

[BAMCIS]

There's the mortgage tax deduction to think about too. The wife and I already own one house free and clear, and are in the position that we can pay off the house we are living in. The financial planner advised against it because of the mortgage tax deduction.

Do what you want, but if it were me I'd just keep on keepin' on.

 

[jluck]

There's the mortgage tax deduction to think about too. The wife and I already own one house free and clear, and are in the position that we can pay off the house we are living in. The financial planner advised against it because of the mortgage tax deduction.

Do what you want, but if it were me I'd just keep on keepin' on.

I'd get a different planner. Why pay...Lets say 10K in interest to write off (get back) 6K. Your planned is a idiot. Go to Dave Ramsey website, There should be a breakdown of said issue.

 

[Oregonhunter5]

There's the mortgage tax deduction to think about too. The wife and I already own one house free and clear, and are in the position that we can pay off the house we are living in. The financial planner advised against it because of the mortgage tax deduction.

Do what you want, but if it were me I'd just keep on keepin' on.

True.
But a planner will always say this. They need your money to invest, versus you paying extra toward mortgage. Most planners are highly unqualified I think.

 

[jluck]

True.
But a planner will always say this. They need your money to invest, versus you paying extra toward mortgage. Most planners are highly unqualified I think.

Many are just a product of there programing/education.

 

[unklekippy]

Nothing is certain. At this point, I can't get behind any financial scheme that will(supposedly) be in place in 20 years. At the same time, people have said we wouldn't make it out of the '80's, '90's, '00s, now we won't make it past 2014 if you listen to the right (wrong?)people. I personally am still waiting for the world-ending earthquake that would hit Portland no later than 1990, then 2000, then 2010, now at any moment(notice a trend?)! Still, I would also warn against putting all your money in an IRA when all the writing on the wall points to economic collapse, maybe not immediately, but by the time a 39 year old is near retirement age. It's all speculation. Anyone "certain" of anything is a liar(or delusional).

My story goes like this. I was born and raised in Portland. I started in my field at 18 on the very bottom. At 26, I was the General Manager of my company. I had 50 employee's below me and only the 2 owners above me. I was proud of my position and worked very hard to get there. I worked 60-70 hours a week, answering my phone at 3am to stay where I was. Hard work is the only way to really get anywhere. If it's handed to you, YOU didn't really "get there", did you? Anyway, by the time I was in my early 30's I started planning for the near future, which meant a debt-free, simple lifestyle for me. Then something disastrous happened. One day at work while looking at a fireproof file that had come into our warehouse for delivery(900+lbs. empty. They are concrete lined.) when something in my back gave. I ended up in surgery and then was told that my arthritis and degenerative disc disease was so severe that every doctor I talked to consoled me and felt nothing but pity for me. Things took a serious turn for the worse for me both mentally and physically. Days would pass when I wouldn't be able to walk across my house or even bathe myself. At 33 years old, I went from regular, 33 year old dude to being a complete cripple. For the first time in my life, ending things was an option. After a near shootout with a few terrible people at the guard shack at OHSU, I decided that my life in Portland a I knew it was done. It was time to set my plan in motion.

I received a settlement from my worker's comp company(evil people. If you are ever in that position, go straight to an attorney. Those insurance folks do not care about you or your starving kids, though they will flat out lie to your face and tell you that our best interests are their concern.) and though it did not represent what I have and will go through, that's the way it is. I liquidated everything I could and set about finding a place to call home for the rest of our lives. I always wanted to be near Lakeview, so we started looking that way. We drove to look at what is now our property, made an offer and drove to Reno to relax for a few days. We completed our offer/counteroffer via fax from Circus Circus. Our house sits on 6 acres and was foreclosed on by the bank and sat empty for almost a year before we got in. In 2009, the last owner pad $89k for my place. He then built in 2011 a brand new 18x20 shop and 12x12 shed with concrete poured floors. Our well is amazingly clean and has wonderful water pressure(Thank The Lord for both of those things.). I am looking at the Sprague River from my 6 foot windows as I type this. I border the Winema NF on 3 sides and have 1 visible neighbor and another around the ridge. When our place was foreclosed upon, I was worth about $100-120k. I am almost embarrassed to say that we negotiated a price of $29,500.

My situation is of course unique, as is everyone else's. I can't believe how well everything worked out. My house and land is paid for. We are setting ourselves up to be self-sufficient. I personally have no faith in a long term "retirement" or "investment" plan. I do not believe it will be worth anything in the future. My investment plan is in hard goods. I have no debt, wiping out the potential for the government or bank to take my home(unless they take my life with it.). I am trying to get my hands on all the things I could need so that even in a robust, thriving economy I have no need for portraits of Founding Father's in my wallet.

I firmly believe that if you can get your money and pay off your home, you are better off for it. I don't see The US as we know it making 2020. I could be wrong, but if I'm right I'd rather be sitting on tangible, useful things than a portfolio that is only good as a fire starter. People can call it "fear mongering" all they want. Since I have been here, I have lost all fear and live more freely than I ever imagined. Living in the rat race with a mortgage and a job that could be lost at a moments notice or chopped in half because of the ACA is where the fear is. Out here, our lives are in our hands and we will not be at the mercy of predatory thugs, banks, politicians or police. It's a beautiful thing. Whether you live in downtown Portland, or somewhere along the Sprague River, when that piece of property belongs to YOU and not a bank, it is a very empowering thing and I am all for it. Good luck to you in whatever route you take.

 

[MinnesotaORnewbie]

So who's the next apple or google?
That's the issue.
It's luck a lot of the time.

Well, cash it in, pay off your house, pray you don't ever loose your job, and let us know how it all is working out in 10 years. I'll let you know how my Roth IRA is doing.

 

[fredball]

Who died before they collected Social Security?



KEEP PASSING THIS AROUND UNTIL EVERY ONE HAS HAD THE OPPORTUNITY TO READ IT... THIS IS SURE SOMETHING TO THINK ABOUT!!!! THE ONLY THING WRONG WITH THE GOVERNMENT'S CALCULATION OF AVAILABLE SOCIAL SECURITY IS THEY FORGOT TO FIGURE IN THE PEOPLE WHO DIED BEFORE THEY EVER COLLECTED A SOCIAL SECURITY CHECK!!! WHERE DID THAT MONEY GO?



Remember, not only did you and I contribute to Social Security but your employer did, too. It totaled 15% of your income before taxes. If you averaged only $30K over your working life, that's close to $220,500.

Read that again. Did you see where the Government paid in one single penny? We are talking about the money you and your employer put in a Government bank to insure you and I that we would have a retirement check from the money we put in, not the Government.

Now they are calling the money we put in an entitlement when we reach the age to take it back. If you calculate the future invested value of $4,500 per year (yours & your employer's contribution) at a simple 5% interest (less than what the Government pays on the money that it borrows), after 49 years of working you'd have $892,919.98.

If you took out only 3% per year, you'd receive $26,787.60 per year and it would last better than 30 years (until you're 95 if you retire at age 65) and that's with no interest paid on that final amount on deposit! If you bought an annuity and it paid 4% per year, you'd have a lifetime income of $2,976.40 per month.

Another thing - if someone died in their 50's or before, they never withdrew one cent of their social security money that they paid into all their lives - so that money just went up in smoke?



THE FOLKS IN WASHINGTON HAVE PULLED OFF A BIGGER PONZI SCHEME THAN BERNIE MADOFF EVER DID.

Entitlement my foot, I paid cash for my social security insurance! Just because they borrowed the money for other government spending, doesn't make my benefits some kind of charity or handout!! Remember Congressional benefits? --- free healthcare, outrageous retirement packages, 67 paid holidays, three weeks paid vacation, unlimited paid sick days.

Now that's welfare, and they have the nerve to call my social security retirement payments entitlements? We're "broke" and we can't help our own Seniors, Veterans, Orphans, or Homeless. Yet in the last few months we have provided aid to Haiti, Chile, Turkey, Egypt and Pakistan.



Literally, BILLIONS of DOLLARS!!! And they can't help our own citizens in New York and New Jersey! They call Social Security and Medicare an entitlement even though most of us have been paying for it all our working lives, and now, when its time for us to collect, the government is running out of money.



Why did the government borrow from it in the first place? It was never supposed to be part of the general fund.




Sad isn't it. 99% of people won't have the guts to forward this. I'm in the 1% -- I just did

 

[Blitzkrieg]

The S&P 500 has gained over 12% per year since Barry took office. Regardless of how you may FEEL he is handling the economy, you're missing the boat. But it sounds to me like you and your wealthy, seasoned investor friends should put your money in your mattresses and sleep well at night.

That's only happening due to the printing presses at the 'federal reserve" running 24/7.. pumping $$ into the stock market, which will eventually bring a massive crash and extreme dollar devaluation

Both parties are raping us.. the much overvaunted Ronald Reagan cleaned out the SS trust fund to pay down the national debt.. outright theft of private funds held in "government trust" ..

 

[Brutus57]

I cashed out a small 403B a year ago, was going to use it for closing costs. Took a 30% hit but worth it.
With a larger one it would depend on where you are in life. I for one would cash out a big one if the Dems when the House in Nov of 2014. REALIZE also it takes 4 to 8 weeks to cash out. Several questions you have to answer and forms to fill out.
Brutus Out

 

[2506]

What you REALLY want to do, in terms of your money, is pay attention to past performance and fact. The facts of the matter are clear that Dems give you a better return than Reps. Cashing out based on based on what you feel is never a good idea. It's your money, do what you want. But for me, I pour money into my stocks any time Dems are in power.