Mortgage extra Payment Calculator

NICE!! Enjoy it! Drive it like it's stolen!!

 

Roth IRAs are the best deal going right now IMO...too bad they won't let you put more $ in them.

401k allows you grow more money over time since it is pre tax....and your taxable investments are technically govt controlled too since nobody knows what future tax rates will be. Either way it is silly not to capture a company's match.

 

That's something I, and many (not all) financial folks disagree with. Tying your money up in 401k's si NOT always a good idea just so you can get a "match" from the company. Personally I don't like it one bit.

 

I respectfully disagree. There is no good consumer debt. I know not everyone agrees and I may be wrong...but that's my opinion and I'm sticking to it.

 

I think you got some serious misinformation there. Not only are all the vanguard index funds charge no sales loads and 12b-1 fees, they also have some of the lowest expense ratios in the industry. For example the Vanguard S&P 500 index (VFINX)

sales load: none
12b-1 fee: none
expense ratio: 0.17% (0.08% if you qualify for admiral shares, 0.05% if your 401k offers institutional shares).

As an index fund its also fairly tax efficient with capital gains as there is not much turnover of the stocks the fund owns.

This is one of the cheapest mutual funds on the market. Whoever told you their offerings are full of hidden fees is probably making a commission selling you actively managed funds. Is your adviser a fee only planner?

 

Apparently you missed my psot above: My Wife is a Financial Planner, CPA, CDFA, PFS, 6, 7,8,....

Vangaurd was just on 60 minutes last year defending (or trying to anyway) for being one of the WORST for hiding fee's, and illegally NOT disclosing fee's and expenses properly. Do you work for Vangaurd?

 

Wow, lots of bad info there. If your "financial advisor" is telling you this, I suggest you find a new one, no offense.

401k's are very beneficial to many of us because we typically are in a higher tax bracket during our working years then we are in retirement when we take the money out. By deferring the taxes to later we pay a lower rate on the money and also havea bigger chunk invested upfront to grow through years of compunding. there are lots of resources on the web to learn more about how this stuff works.

There are all kinds of ways to use 401k money early if you want to . You can retire early before 59 1/2 by setting up a SEPP plan.

Now can the fed retroactively change the tax rules in future? sure they can but I doubt they will, it would be political suicide and AARP is a very powerful lobby. For the same reason I dont think any administration is evre goign to have the guts to just turn of social security cold turkey... there would be rioting in hte streets.

 

Market charts don't support this claim. Look it up, bro.

 

That is such a load,,,,, sorry! I here this time and time again, and facts are facts. Sure, retirement companies LOVE to tout this BS to everyone in order to get you to give them more of your money. But the truth, and facts are much different. 90% of the time, people do NOT get a tax "benefit" as suggested from deferring their taxes via retirement funds. First, again taxes go UP, not down. So when you use that money, you WILL pay a higher tax on it. And the argument that your in a higher tax bracket now, is rare nowadays. Ask my elderly father who was a high paid airline pilot back in the heyday for pilots. He is getting KILLED by his deferred funds, hammered to death! He now wishes he never gave them a dime. His personal investments on the other hand have made a fortune for him, less taxes in the long run, higher incomes, less fee's, and all the while it's HIS money to do what he wants, when he wants. The goberment can't touch it or tell him when or how much he can spend.

That argument is the worst! Ever see the percentage of people who get to spend there 401k money, ever? It's a ridiculous #, most never get to spend it.

 

My wife publishes some of those "charts".

 

Let's not start a pizzing match here. I'm out. Peace.

 

In debate circles that would be called "argument from ignorance".. I cant prove you wrong, but neither can you give evidence to prove its right, since the 401k has effectively only existed for a bit over 20 years and not nearly enough people who have them have reached retirement age to make a judgement either way. Try again.

Sorry, it all started 3 years ago, and it was just one competitor with an Axe to grind against them whose claim was later debunked. Try again.

http://www.cbsnews.com/news/ric-edelman-accuses-vanguard-of-hiding-fees/


I dont work for vanguard. I dont work in the finance industry period, so I have nothing to gain reccomending them other than being a satisfied customer. Sounds like you are the one with an agenda.

To everyone else - dont invest in vanguard, or anything else that I say to just on my suggestion. I am NOT a professional and have no training in finance other than what Ive read. I do share on this thread techniques that work for me, and if you want to use them great but I strongly recocmend you read and research and confirm anything I state independently before deciding.

I'm also gong to bow out now, not in the mood for a shouting match.

 

Now that is good advice!

I have no agenda in this except that I can't stand much of the propaganda that is brain washed into people today by the large institutions, to do nothing but make the institutions (made up of the so called 1%'ers) even richer!

 

This thread is about paying down your mortgage early...
Gamble the extra in your portfolio or pay off the principle on your mortgage and save a few bucks on interest, stop paying your monthly payment to the bank years(or decades) earlier than planned.

Quick example for 401ks on 100k income:
leaving a company match of 100% on your first 3% =$3000/yr
75% on the next 4-5%=$750-1500
50% on the 6th% - $500

so if you invest the minimum $3k - you have $6k :100%ROI
4K - $6750
5k - 7500
6k - $8k=20% ROI

Show me a fund that guarantees 20% ROI on capital investment prior to growth.
(some matching 401ks work differently but this is my experience from a few different companies)
if matched in company stock, once vested there is nothing stopping you from divesting the match and transferring into a mutual fund(provided the 401k offers options)

 

I couldn't disagree with this more.

Using a FP assures you lose 1% before the market performs anything.
And that's before you lose another .5-1% on the funds they put you in.

So, you need to make 2% just to break even. Market makes 6, you make 4. Market loses 4, you lose 6.


If you don't know what you're doing, and aren't going to retire in the next 5 years,
25% in an S&P 500 index fund like FUSEX
25% in an international sector fund like VITAX
50% in an age-based auto re-scale like PARLX (for 2045 retirement)

and save yourself the costs and headaches of actively managing anything.

disclosure, I am personally invest in all 3 of those, but to WAY lessor extents. probably 20% total. But I monitor and trade all day every day.

 

The 401k is merely 1 of several vessels one should use as a diversified portfolio of asset types.

Like most things, people use it wrong, meaning, it's all they use.

Use it up to and only up to your companies match. if they match 3%, you put 3%. no more.
the ONLY time you should put more is if you need to lower your tax base a bit and you're border line. Ie, you're married and are teetering on the 74,900 limit of where your tax owe goes from 15% to 25%, it might be a good idea to just take that couple thousand that you're going to lose anyway on the money above 74,900 and put it away.

If they don't match, and you can't take advantage of the pre-tax deduction, skip it. But you gotta be dedicated to accepting the fact that that money is already gone from your check. If your company lets you put in multiple accounts for direct deposit, maybe that's what you need to do.

Max out your roth ira first. 5500 currently standard max.
Then contribute as much as you can to a regular IRA that you control, not tied to 10-ish funds some bigwig thinks is best for you i think it's 17,500 now.
If you still have money, you're rich put 12 distributions in year CDs, opening one each month with a new balance. You can usually open a CD with as little as $500. That way, if you need to pull, you have an option coming in every month to not re-new without taking any penalty. Next year, simply renew those and open 12 more at a 2 year rate that's higher. You'll still have round 1 to pull if you need it, and then you'll end up with 3 years of "paychecks" coming in every month which could mean everything if you lose your job. If you don't need it, don't pull it. This may take a few years to establish and get in a good cycle, and requires a lot of running to the bank if you can't find digital CDs.

Yes, the government sucks. but you can't invest in cash. putting it under your mattress assures you will lose value.
The good thing is that 'rich' people use these vessels to escape taxes too, so they won't let it go anywhere. companies too get a break for matching

 

I thought your combined Roth and traditional ira were capped at 5500...but you are saying max Roth then contribute to ira..???