76.8% Return on 401K

[JethroB]

Back in “the day”, big companies provided BOTH defined benefit pension plans and 401-k’s with matches.

No longer.

Glad I worked back in the day.

MoKelly

I was fortunate to work for a company like that for 24 years. Then our company got bought and the pension was immediately frozen and no new hires could enter the pension plan. Years later I took a lump sum payout and rolled it to a IRA. Glad to have gotten out of that orphaned plan.

 

[fried1765]

Anybody here under the illusion that Roth rules will not be altered in the future.?
The Roth rules WILL BE CHANGED, and your Roth money will be taxed!l
Why?
Because it is there.....just waiting to be taxed!

 

[MossRoad]

Anybody here under the illusion that Roth rules will not be altered in the future.?
The Roth rules WILL BE CHANGED, and your Roth money will be taxed!l
Why?
Because it is there.....just waiting to be taxed!

At least I'll still have something after taxes.

Better to be able to buy a turd sandwich with mustard VS just a turd sandwich.

 

[fried1765]

At least I'll still have something after taxes.

Better to be able to buy a turd sandwich with mustard VS just a turd sandwich.

Kinda depends on the brand/flavor of the mustard.
I do not like Goulden's!

 

[Birdhunter1]

Anybody here under the illusion that Roth rules will not be altered in the future.?
The Roth rules WILL BE CHANGED, and your Roth money will be taxed!l
Why?
Because it is there.....just waiting to be taxed!

I'm 40 and do not doubt that one bit.

 

[MoKelly]

This is from memory but we had a guy at my last place of employment who brought his paperwork in and showed it to our boss when they announced the plant closure. He was a union guy who got into the company sponsored 401K even though they didn't match anything for the union people. If I remember right he basically played a bond fund against the Goodyear company stock and had increased his fund to $1.6 million. Think about that. Goodyear stock is notorious for going up and down in large amounts. All his investment went into the stock until it hit a certain dollar amount. He then changed it all to the bond fund. When Goodyear stock dropped to a certain point he bought it back emptying the bond fund. I worked there four years and the fund was around $30 when I started and dropped to $3.89 before I quit.

That took balls.

I remember that he was able to put a significant amount of his wages into the 401K because his wife made good money.

RSKY

Yes! Nowadays, after Enron, it’s quite difficult to buy company stock in a 401k.

 

[JethroB]

I was the administrator of my employer’s 401k plan before I retired. Lots of federal ERISA rules & regulations of how a plan is to be run but little on what investment options should be offered. My best move was to hire a good investment advisory firm to keep me out of jail or being sued. Company or even individual stocks threw up red flags. Initially the overall plan balance was very heavy in the default money market fund. Scary mess I inherited. Went from 6 funds to 21 with the defaults being changed to age based Vanguard funds.

 

[dmccarty]

Kinda depends on the brand/flavor of the mustard.
I do not like Goulden's!

OHHhhhhhh, you are one of THOSE guys who asks for The Grey Poupon!

Seriously though, last year we were on a trip and staying at place with a kitchen so we could prepare our own food. The local store has a brand of mustard we do not have locally. One was a horse radish and the other a honey mustard mustard. Now, we have these types of mustard in the local store, but the brand we bought on vacation was SOOOO much better. And I used up one of the mustards! Dan Sad.

Going back soon so I will buy a few extra bottles of that mustard.

Later,
Dan

 

[MossRoad]

I've been using the Heinz Mayoracha Sauce quite a bit lately.

Heinz Mayoracha Sauce, 16.6 oz Bottle | Heinz®

Heinz Mayoracha Sauce, 16.6 oz Bottle

www.heinz.com

And a store brand honey mustard. Very tasty.

 

[PuffyC]

Couple comments but first a disclosure that I admit to being partial towards the Roth account.

I'll tell a story to someone starting a 401K account:

1. Pretend you're a farmer and today is the day to buy the seed for your land.
2. You can buy your seed one of two ways
3. You buy it out of my RIGHT hand, you will pay for the SEED, you will pay NO sales tax....you instead will pay tax on the harvest.
4. You can instead buy your seed from my LEFT hand. You will pay for the seed, you DO pay sales tax and now, your harvest is TAX FREE.

Which farmer would you rather be?

I'd dare say that of the (hundreds) of people that have heard that.... invariably 99.9% of them choose the tax free harvest which is how the Roth works. Or look at it this way.....you put in $100 today and do your best to grow it to $1,000 when you retire. Would you rather pay the tax on the $100 or the $1,000?

Highly compensated people "can't" do a Roth IRA = NOT necessarily true. They can do what is called a "Back Door Roth" Google can be your friend (though I admit I didn't google it to see what pops up)

It's moronic that the govt makes people do these gymnastics to get this done.

Obligatory Disclaimer: One should always discuss with their CPA or other tax advisor

Don’t forget that by paying taxes on the front end, let’s say it’s 20%, you get 20% less seed to plant, meaning your harvest gets cut by a whopping 20% as well. So really the question would be “do you want an 80% harvest that is tax free, or do you want a 100% harvest that is taxed?” Whether one is better than the other mostly just depends on what your top bracket is today vs what you think it will be come harvest time.