- My Forums
- Tiger Rant
- LSU Recruiting
- SEC Rant
- Saints Talk
- Pelicans Talk
- More Sports Board
- Coaching Changes
- Fantasy Sports
- Golf Board
- Soccer Board
- O-T Lounge
- Tech Board
- Home/Garden Board
- Outdoor Board
- Health/Fitness Board
- Movie/TV Board
- Book Board
- Music Board
- Political Talk
- Money Talk
- Fark Board
- Gaming Board
- Travel Board
- Food/Drink Board
- Ticket Exchange
- TD Help Board
Customize My Forums- View All Forums
- Show Left Links
- Topic Sort Options
- Trending Topics
- Recent Topics
- Active Topics
Started By
Message
No 401K Investments
Posted on 1/6/25 at 3:27 pm
Posted on 1/6/25 at 3:27 pm
We have a young kid at my place of work who doesnt put any money into his 401k. Company matches dollar for dollar up to 7%. He believes investing in rental properties and lease to own properties will give him greater "freedom" and returns. What says the board?
18
Posted on 1/6/25 at 3:31 pm to RoosterCogburn585
100% immediate return hard to pass up for me.
Posted on 1/6/25 at 3:35 pm to RoosterCogburn585
Said one of the VPs at my last employer:
Before any market return you are doubling your money on that 7%. I doubt his real estate investments will bring that type of a short-term return.
quote:
It’s free money, and if you can’t understand that you may be too stupid to work here.
Before any market return you are doubling your money on that 7%. I doubt his real estate investments will bring that type of a short-term return.
Posted on 1/6/25 at 3:35 pm to RoosterCogburn585
He dum.
Posted on 1/6/25 at 3:38 pm to BillyOceans11
Agreed. I get having the real estate as a side investment, but not putting anything into the market has me baffled. Especially when you have a guaranteed 100% return.
Posted on 1/6/25 at 3:45 pm to RoosterCogburn585
If you like him, probably time to educate him. If he refuses there is little you can do.
He would have to be stupid to give up an instant 100% return on his money though
He would have to be stupid to give up an instant 100% return on his money though
Posted on 1/6/25 at 3:48 pm to UltimaParadox
I have tried, along with half of the rest of the department. He just keeps going on about the "freedom" of being able to access the money whenever he wants. Not having to wait until he's 55.
Posted on 1/6/25 at 4:05 pm to RoosterCogburn585
If he catches real estate in an upswing, he may look like a genius. If he catches it in a downswing, he may go bust. Only time we all.
Posted on 1/6/25 at 4:08 pm to RoosterCogburn585
Explain to him that even if he takes a non qualified early withdrawal there is only a 10% penalty. I hate 401k loans but thats also a means to access capital early.
Real estate is one of the least liquid investments if accessibility is his priority. Transaction costs eat into gains and it takes time to find a buyer and close.
Real estate is one of the least liquid investments if accessibility is his priority. Transaction costs eat into gains and it takes time to find a buyer and close.
Posted on 1/6/25 at 4:08 pm to RoosterCogburn585
I mean I get it
America is falling apart but everybody believes that the stock market will keep going up in a straight line. As you get a little older you see they take like half of your check for taxes and then you figure out that instead of building interstates and stuff with it the government is essentially shoring up the stock market with your tax dollars via slush payments to corporations under the guise of “foreign aid” “food stamps” and other wastes of money. The only way to get any of your money back is to participate in the stock market. The ceo and your representatives get 90% of your tax dollar but you might be able to get 10 cents back if you invest well
Also real estate is a lot harder when you’re competing against trillion dollar companies that can borrow from the fed at 0% interest
America is falling apart but everybody believes that the stock market will keep going up in a straight line. As you get a little older you see they take like half of your check for taxes and then you figure out that instead of building interstates and stuff with it the government is essentially shoring up the stock market with your tax dollars via slush payments to corporations under the guise of “foreign aid” “food stamps” and other wastes of money. The only way to get any of your money back is to participate in the stock market. The ceo and your representatives get 90% of your tax dollar but you might be able to get 10 cents back if you invest well
Also real estate is a lot harder when you’re competing against trillion dollar companies that can borrow from the fed at 0% interest
Posted on 1/6/25 at 5:43 pm to RoosterCogburn585
He should be doing both. Limit his 401 contribution to the match, then use remaining money for real estate. I have done real estate for years. It can be lucrative, but it is hard to beat a 100%.
Posted on 1/6/25 at 6:00 pm to KWL85
Real estate is cool because you don’t think about it much until days like today when you hope the girls drip the pipes
Posted on 1/6/25 at 6:57 pm to KWL85
Totally agree with you on that one.
Posted on 1/6/25 at 6:58 pm to RoosterCogburn585
Real estate can be really profitable. However, I prefer the liquidity of stocks.
Renting to tenants isn’t easy and it costs a lot for someone else to manage.
I get it though as there has been a historical run of real estate appreciation over the last 8 years.
Best advice is to let him get into the rental game and see how much it really cash flows after repairs, renters not paying timely, etc. I know when I was younger I had to experience things first hand before I learned.
Renting to tenants isn’t easy and it costs a lot for someone else to manage.
I get it though as there has been a historical run of real estate appreciation over the last 8 years.
Best advice is to let him get into the rental game and see how much it really cash flows after repairs, renters not paying timely, etc. I know when I was younger I had to experience things first hand before I learned.
Posted on 1/6/25 at 7:08 pm to RoosterCogburn585
quote:
Agreed. I get having the real estate as a side investment, but not putting anything into the market has me baffled. Especially when you have a guaranteed 100% return.
And if he just contributes enough to get the max match he isn't really out of that much net pay and could probably still do the real estate side investment. If he didn't have 7% of wiggle room to get into those investments he probably wasn't ready for them anyway.
Posted on 1/6/25 at 7:42 pm to RoosterCogburn585
I love real estate but Investing in index funds is way easier than managing rental properties.
Posted on 1/6/25 at 7:45 pm to RoosterCogburn585
He’s absolutely right. I bought 14 doors from 24-27 years old. Started with 40k in cash because the company I worked for out of college didn’t offer a 401k match.
Those properties generated considerable cash flow, tax benefits, and even if I didn’t pocket a dime from them would be worth much more in 20 years than if I put it into some vehicle I can’t touch until retirement.
401k is conservative and will help you retire, real estate will help you retire early and grow your wealth much better IF you’re successful with it.
Those properties generated considerable cash flow, tax benefits, and even if I didn’t pocket a dime from them would be worth much more in 20 years than if I put it into some vehicle I can’t touch until retirement.
401k is conservative and will help you retire, real estate will help you retire early and grow your wealth much better IF you’re successful with it.
Posted on 1/6/25 at 8:30 pm to nugget
How old are you now and how far ahead are you from real estate?
Posted on 1/6/25 at 8:34 pm to RoosterCogburn585
He’s probably just trying too hard to be non conformist. It’s apparently worth a lot of $ to him to have y’all’s attention. I wouldn’t sweat it any longer.
This post was edited on 1/6/25 at 8:35 pm
Posted on 1/6/25 at 9:23 pm to RoosterCogburn585
quote:
He believes investing in rental properties and lease to own properties will give him greater "freedom" and returns.
because of the instant cash flow. he is not wrong. he does not want to wait until 59.5 to see his 401k. just like someone can get cash flow from dividends or trading actively. to each his own. i like them all.
however i believe in investing in a multitude of things and never leave free money on the table. tell him to at LEAST put in the MATCH.
Page 1 of 2
Popular
Back to top
Follow TigerDroppings for LSU Football News