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Started By
Message
re: Why does Kiyosaki hate the 401k
Posted on 2/26/23 at 1:10 pm to JimMorrison
Posted on 2/26/23 at 1:10 pm to JimMorrison
quote:
The investment options are limited in 401k and insufficient for any experienced investor.
0
Posted on 2/26/23 at 1:46 pm to JimMorrison
quote:
Plus, you have no idea what the tax code will be when you're at the age to withdraw.
Why does that matter didn't pay taxes now
Posted on 2/26/23 at 2:00 pm to Fat Bastard
How do you know that real estate laws won’t change? How do you know that rent restrictions won’t go into place? If your basis is off the what if, that doesn’t solely pertain to the stock market.
Posted on 2/26/23 at 2:12 pm to GeauxTigers777
quote:
How do you know that real estate laws won’t change? How do you know that rent restrictions won’t go into place? If your basis is off the what if, that doesn’t solely pertain to the stock market.
i covered this tax wise already in a post on last page.
quote:
now could they raise taxes and/or change rules on investment and passive income(marginal) tax rates? very possible. who knows what the future will bring.
Posted on 2/26/23 at 2:19 pm to Yeti_Chaser
He likes leverage on real estate, but the numbers aren't as pretty any more.
This post was edited on 2/26/23 at 2:20 pm
Posted on 2/26/23 at 3:24 pm to PhiTiger1764
quote:
much better? How?
By having control of your money, you can invest as you see fit and realize better returns than being limited to select, generic mutual funds that mostly track the S&P. All the while, the big government says you can't take your money and invest in better opportunities until you hit a certain age.
You could just outright buy the S&P/SPY and do just as well as 401k portfolios, if that's your goal. What I'm suggesting isn't for everyone, obviously. 401ks are set up for the masses so it forces them to not spend every dollar they earn.
I'm speaking more to active investors and not the majority who keep their 401k in a target date fund and never look at it.
Posted on 2/26/23 at 3:27 pm to Fat Bastard
quote:
now, the solo401k is a different animal. sure, same rules still apply as to when you can withdraw without penalties, and no it will not help you retire any sooner because you cannot use the cash flow until age rules are met, however, you are the trustee and plan administrator and can invest in basically whatever you want. Which makes it great for RE. Way more control than some plan sponsored by some company.
This is definitely a better option than most 401k plans, but as you said, still age restricted and not ideal.
Just pay your taxes now, invest wisely, and retire earlier.
Posted on 2/26/23 at 3:32 pm to thelawnwranglers
quote:
Why does that matter didn't pay taxes now
You will pay income tax when you withdraw from your plan. The tax rate at that time is unknown. Why risk paying a higher tax rate?
Posted on 2/26/23 at 3:34 pm to Fat Bastard
Congress already floated the idea to tax unrealized gains. Imagine the shite they will come up with next
This post was edited on 2/26/23 at 4:00 pm
Posted on 2/26/23 at 6:29 pm to JimMorrison
quote:
you can invest as you see fit and realize better returns than being limited to select, generic mutual funds that mostly track the S&P. All the while, the big government says you can't take your money and invest in better opportunities
Are you talking about better opportunities/returns in the stock market or are you referring to other investments such as real estate?
Posted on 2/26/23 at 6:38 pm to JimMorrison
quote:
The only good things about them
Tax sheltered time value of money did not make your list?
Posted on 2/26/23 at 6:45 pm to fallguy_1978
quote:
401ks are a shitty replacement for pensions but it's where we are now. Nobody knows how much they should save because they don't know how long they'll live. As much as possible seems to be the only answer.
The avg person would be far better off with a pension. 401ks, while offering many good things (lower costs/liabilities for companies, more control for investors, tax deferred time value growth, portability, etc), displaced the very important “guarantee” from the avg person, and I think hurts more than helps too many.
Posted on 2/26/23 at 7:23 pm to JimMorrison
quote:
you can do much better and have more control over your future without a 401k. The investment options are limited in 401k and insufficient for any experienced investor.
I’ll put my max-funded with 3-7% per year match Roth 401k in a total market fund (with a small international and small cap tilt) and do better than almost any “experienced investor” in a taxable account with the same amount of money over the same period.
Posted on 2/26/23 at 9:36 pm to Hopeful Doc
I obviously don’t want to be rich bad enough because I’ll be damned if I want to fool with rent houses.I know several people that have rent houses and the stories I hear is nothing I want to deal with.
I have R/O Ira from 401k,Roth Ira and taxable account.I’m very comfortable.
I have R/O Ira from 401k,Roth Ira and taxable account.I’m very comfortable.
Posted on 2/26/23 at 9:59 pm to LSUA 75
quote:
I’ll be damned if I want to fool with rent houses
you do not have to. get a PM. i have been through all this before and much much more. you do u man.
quote:
.I know several people that have rent houses and the stories I hear is nothing I want to deal with.
purely anecdotal evidence. so maybe they are not good at it? You are letting their stories influence you? Educate yourself then decide. we have many here who do fine at RE but you ignore that right? LOL
What if 3 people told u how terrible the stock market was...would you avoid that also?
your confirmation bias hearing those stories has your mind already made up sadly. but you do you man.
so glad i never listened to a small sample size of people like your friends before i educated myself on it and got into it.
This post was edited on 2/26/23 at 10:04 pm
Posted on 2/27/23 at 5:28 am to Fat Bastard
God I hate residential real estate as well but it made me a frick ton of money.
Posted on 2/27/23 at 7:31 am to I Love Bama
there's pros and cons to everything as we know. no high yielding investment is always peaches and cream. i like to be diversified into many different investments. i just like RE the best. i still like stock and commodity markets right behind RE.
quote:
but it made me a frick ton of money.
Posted on 2/27/23 at 8:37 am to Yeti_Chaser
I believe the idea that the 401k isnt great is perpetuated by earlier 401ks with super high fees and not great investment options.
401ks have gotten better over time and as many different ones I've seen, very few have looked bad at all. Worst one I saw was my wife's old company where the investment options were like 8-10 different funds and the expenses were between about 1.5%-2% on them. Even then, she got a 3% (of her pay) Safe Harbor Contribution every year by her employer in in there, so that's literally just free money - she didnt even need to put money in herself. So even with the high fees and few investment options (some of which were good from a return standpoint still), 3% free money is free money.
Most 401ks now are pretty well fleshed out with many different lower cost index/mutual fund type that anyone would be fine in over the long haul and getting some type of match or safe harbor contribution makes it an absolute no brainer to take at least that for anyone. You arent getting a guaranteed 50-100% return on your money immediately anywhere else.
401ks have gotten better over time and as many different ones I've seen, very few have looked bad at all. Worst one I saw was my wife's old company where the investment options were like 8-10 different funds and the expenses were between about 1.5%-2% on them. Even then, she got a 3% (of her pay) Safe Harbor Contribution every year by her employer in in there, so that's literally just free money - she didnt even need to put money in herself. So even with the high fees and few investment options (some of which were good from a return standpoint still), 3% free money is free money.
Most 401ks now are pretty well fleshed out with many different lower cost index/mutual fund type that anyone would be fine in over the long haul and getting some type of match or safe harbor contribution makes it an absolute no brainer to take at least that for anyone. You arent getting a guaranteed 50-100% return on your money immediately anywhere else.
Posted on 2/27/23 at 8:53 am to Fat Bastard
quote:
you do not have to. get a PM.
This kills your profits
Posted on 2/27/23 at 9:03 am to Upperdecker
quote:
This kills your profits
wrong again. we have been through this shite a million times here.
so my PM is killing my profits? right now?
Are you fricking serious? This shows you have never dealt with RE or PM or maybe do not know what you are doing. one more time. IF you buy RIGHT it is factored in when you run your PCF numbers. If that amount of PM( as long as you shop and get a good rate and vet them) makes the difference in breaking you then you have a bad deal to begin with.
I have only been doing this shite for ages but carry on with an ignorant false narrative.
This post was edited on 2/27/23 at 9:05 am
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