Thoughts?

[CosMoen]

How to Access Retirement Funds Early

This author advocates ways to use 401k to compound pre-tax money and employer match contributions, letting it compound tax free over many years.

He even did the math and showed that with the early withdrawal 10% penalty, it still made financial sense because of the tax-free compounding.

Thoughts?

Debating which is the better path
1. Contribute only up to employer match amount, and use the funds
2. Contribute up to the max IRS limit of $18,000, let funds compound, and withdraw it for early retirement using the method described in the article.

 

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[G-Man]

How to Access Retirement Funds Early

This author advocates ways to use 401k to compound pre-tax money and employer match contributions, letting it compound tax free over many years.

He even did the math and showed that with the early withdrawal 10% penalty, it still made financial sense because of the tax-free compounding.

Thoughts?

Debating which is the better path
1. Contribute only up to employer match amount, and use the funds
2. Contribute up to the max IRS limit of $18,000, let funds compound, and withdraw it for early retirement using the method described in the article.

Nothing wrong with 401ks and IRAs as a little extra retirement money, but why bother with stuff like this as a wealth building vehicle.

Contribution limits + stock market + government regulated withdrawals = devil's butthole trifecta of lack of control.

 

[CosMoen]

Nothing wrong with 401ks and IRAs as a little extra retirement money, but why bother with stuff like this as a wealth building vehicle.

Contribution limits + stock market + government regulated withdrawals = devil's butthole trifecta of lack of control.

I understand...but at the same time I work in a very high income tax state and save about 50k/year of my take home pay for investment purposes (live on 30k).
It hurts me how much in taxes I am paying and I am looking for ways to shelter my income while still working a day job.

 

[G-Man]

I understand...but at the same time I work in a very high income tax state and save about 50k/year of my take home pay for investment purposes (live on 30k).
It hurts me how much in taxes I am paying and I am looking for ways to shelter my income while still working a day job.

Guess it all comes down to which eventuality worries you more.

 

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[ljean]

I max mine out, I dont have anything better to do with the $$ really.