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How many people have pulled their 401K?
Submitted by jpd129 on Thu, 10/09/2008 - 15:06
I haven’t yet but everyday I think I should regardless of the penalties, might not have anything to pull if I wait. » |
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We have talked about this on DP
for the last year - even more! I HIGHLY RECOMMEND THE BOOK MENTIONED BELOW - READ FIRST AND THEN DECIDE!
I pulled mine in Jan. 2007 and my annuity in Jan. 2008.
Some fur balls on Dr. Phil today said, unless you need the cash, just continue to contribute to your 401k. The ones who will win are the ones who will buy low when everyone has sold low.
The time may have passed - but you decide. I would take the penalty and cash it out.Today's financial advisers do not know their head from a hole in the ground. You MUST do your own homework and do the math regarding the penalty and tax. What I can tell you, is that TODAY'S tax may be a bargain compared to what it will be during the next administration. 35% is better than 50 - 75%. There were times in our history where it was 90%.
Instead of throwing good money after bad, I would take your 401k contribution and put it in a separate savings account, and call it your "WCA" Wealth Contribution Account. You control this money but ONLY use it to make more money; then put it all back. YOU be the BANK.
Have your regular savings for things such as emergency purchases like appliances, or new tires, or whatever comes up.
If you want to save for a vacation, or something else special, open another account.
This sounds like a lot of accounts, but think about it. When you keep them all separate, you know exactly how you are doing.
Then, if something unexpected comes up, decide which account to utilize first. Most important, leave the WCA ALONE. That's your working capital - using your own money over and over to make money!
I highly recommend www.killingsacredcoew.com for a book which dispels money myths we were taught growing up. Once you change your paradigm, you will understand what to do with your money.
Ridh Dad/Poor Dad told everyone to take complete control of our own money. In the market, THEY have control.
One thing people DO NOT UNDERSTAND, is you can start your own bank by buying WHOLE LIFE insurance. Buy as much as possible - consider your 401k contribution amount as the monthly payment. This accomplishes many things. You have instant protection for your family AND it will grow in cash savings. You can BORROW from yourself - no one has to give you approval! After three years of payments, your cash balance will be MORE than what you paid into it. PLEASE CHECK THIS OUT WITH AN INSURANCE SALESPERSON. Forget the financial advisers!
Get your own education and only count on yourself. Lots of BAD info now on TV - some good, but most bad. Especially when they tell you to leave it alone and it will grow. If you loose 50%, it will take you YEARS to get back to original amount, before it even starts to grow!
Thanks for the advice.
I can't get your link to work.
I thought about it but
failed to act on it. I guess I will deserve whatever comes of it then........damn!
~Your perception becomes your reality~
I moved my husband's into
I moved my husband's into fixed income weeks ago and my stocks that are not a retirement account have been moved into short funds. His is holding steady and mine is doing fine with this movement.
Six months ago my wife put 95% into fixed interest
Last week she put it all into fixed interest and now we're going to move it into a self directed IRA and buy precious metals with Midas resources.
Her coworkers lost tens of thousands of dollars while she actually gained some from her fixed interest.
It really pays to be a Ron Paul Supporter.
My guess is when the price of one ounce of gold comes close to the Dow is the price to buy stock.
http://killfiat.blogspot.com/
I think there is like $50
I think there is like $50 bucks in mine. Should I even bother?
Why? To buy a loaf of bread?
Seriously, $50?
Not pulled, just adjusted allocations
About 4 months ago I reallocated all my money over to short term reserves (money market) and out of stocks.
Exception is that my company match is in company stocks. I just move them manually when they come into the account on payday.
So far so good.
"Dependence begets subservience and venality, suffocates the germ of virtue, and prepares fit tools for the designs of ambition." -- Thomas Jefferson
I didn't
but then again, like social security, I never thought I'd ever see the money again anyway. Am still paying into it to heh. Have bought all my survival supplies and such, made emergency plans to a point. So I figure if nothing happens, well I might just get supprised one day by getting my money back. Not holding my breath.
I rolled one IRA over into
I rolled one IRA over into gold in July 2007 and the other moved everything into money market in October 2007. I had been waiting for this to start for at least 3 years.
Me too. The money market
Me too. The money market "broke the buck" so now I've become scared again
Failsafe Investing By Harry Browne
I wrote this before and it is from a great book by the great Libertarian Harry Browne.
This has served me very well during these crazy times. The best part is you don't even have to freak out, worry, and second guess yourself. Plus you don't have to time the market to be safe.
First off the purpose of this is preserve and grow your wealth. If you enjoy speculating take 5%-10% of your retirement and put it into a speculation account. Do what you want with this. With the amount you really can't afford to lose do the following.
Put 1/4 into Cash (Mutual Fund fully backed by T-Bills.)
Put 1/4 into long Treasure Bonds (Not a bond fund but actual bonds. Start with 30 year Bonds and as they get close to 20 years sell them and buy more 30 year Bonds).
Put 1/4 into an S&P 500 mutual fund (Find one that has low fees)
Put 1/4 into gold. (Coins stored in a safe deposit box is the best)
If you have an IRA or 401K fill them in the above order since T-Bills and Bonds throw off interest which will be taxable.
Here is how to maintain your portfolio. If any one catagory changes by more the 10% rebalance the whole thing. As long as they stay between 15% and 35% you are OK. I checked mine and even with the stock market down I'm still at 16% in stocks which means I should be getting pretty close to rebalancing.
This rebalancing is very important becuase it allows you to lock in gains and get in near bottoms. It also allows you to not worry about making the right decision when you are emotional.
As you get money to invest put it into your Cash account. (If it is in your IRA you may want to have a seperate one outside that you can access). When you have enough that it gets above 35% rebalance.
The reasoning behind this stratagy is simple. For any economic condition one catagory will carry the load.
Cash is good during deflation.
Gold is unreal during inflation.
Long Bonds do OK in prosperity and deflation.
Stocks do great during prosperity.
You would think these would cancel out but what they really do is represent the economy as a whole. It evens out the Fed created Boom Bust cycles pretty good. The only time it doesn't do well is during depression but at least the gold saves your bacon.
Oh I forgot. He made a fund called the Permanent Portfolio which closely tracks his stratagey called PRPFX You can see a comparison herehttp://finance.yahoo.com/echarts?s=PRPFX#chart2:symbol=prpfx;range=5y;compare=^gspc;indicator=volume;charttype=line;crosshair=on;ohlcvalues=0;logscale=on;source=undefined
I don't have one but my wife has one.
We have not yet cashed out or rolled it over and we haven't made any contributions. I sent an email to Peter Schiff at EPC but have not yet received a reply.
---
www.campaignforliberty.com
www.libertyworksradionetwork.com
www.freedom-force.org
www.campaignforliberty.com
Schiff ain't perfect either
Of all my mutural funds - Schiff's europacific fund is my biggest loser.
Good to know, thanks.
---
www.campaignforliberty.com
www.libertyworksradionetwork.com
www.freedom-force.org
www.campaignforliberty.com
I didn't
I moved things around and put most of it in a fixed income fund with a low rate of return but I don't even feel that is secure anymore. I also put some in international funds. I thought about pulling it out but I just couldn't bring myself to do it.
I didn't cash out
But I moved all my money to a Stable fund. While everyone is losing, I'm gain (super little amount) but it's better to be a few dollars plus than thousands and thousands minus.
The company gives me matching and an anual 401k bonus contribution so I don't see how cashing out will help. Unless of course the dollar collapses.
I am very young
so i dont have much to lose. I should probably stop paying into it for the time being shouldnt I?
Not necessarily...
Stock prices are pretty cheap right now.
They may get even cheaper, true... but the prices aren't bad now.
Let's put it this way... the Dow was over 14,000 and now it is at 8500 -- so it is now at only 61% of it's peak, that's a loss of 39%
Now even if the Dow drops to say and absolutely unheard of 7,000 or slightly less that will only be a further loss (from 8500 down to 7000) of 18% -- a lot LESS damaging than the earlier loss of 39%.
BUT, all that said, no one (and I mean NO ONE) really knows where the "bottom" is or what happens after that -- and whether or not we're going to end up in hyperinflation-lala-insanity-land. (If we do end up in hyperinflation, then all bets are off -- and what you did with a few bucks in a 401K or not won't matter any more to your future than what you did with those stacking blocks back in preschool).
If you want you can throw a minimal amount at it -- and then just ignore it. (Unless your employer is giving matching funds and/or drops a profit sharing bonus in there, then you're really not benefitting from it being a 401K and you may as well just put money into an IRA or plain old savings account... or heck, buy extra canned food ahead of time.)
Transferred mine to a "guaranteed portfolio"
(3% annual growth rate) in Feb. My husband now thinks I'm a clairvoyant or something! I think it's safe there. Who knows.
Guaranteed by who? what? AIG?
There is no such thing as a truly "guaranteed" anything in the market.
Not even Gold or Silver.
Clarification
Fixed income bond fund. I'm sure there are better options, but it's working for the moment.
Pulled out of market last fall & winter (near the peaks).
Rolled it all over into an IRA that is under my control (no penalties to do that you know).
Cashed out a bit of it... and strongly considering cashing out the rest, if only because taxes will DEFINITELY be higher in the coming years -- so probably better to pay the penalty and taxes NOW rather than later.
Only thing I am hesitating on is whether I should roll the balance over to a Roth IRA (where the interest accumulates tax free, and you can access the principle w/o penalty after a "seasoning" period) -- or whether I should take it ALL the way out.
I'm leaning towards the latter -- just because I don't trust them NOT to change the rules on 401K's and IRA's (including Roth) sometime in the future under the pretense of "saving people's retirement funds" -- and then rolling everything into some weirdo combined 401K/Pension/SocSec fund thing that is NOT under your control. (And I know that sounds "insane" -- but hey, so does the Dow going to 8,000, or the US Treasury "investing" in banks, etc.)
Seriously, if they turn this latest crash around and try to blame the volatility on "panicking 401K owners" then isn't it inevitable that they will in the future try to prevent anyone else from doing the same (in essence nationalizing people's 401K's?)
None of that could have happened in America... but in the new 21st century fascist state of AmeriKa... anything is possible, and "unprecedented" is the word of the year.
i cashed out
the fools at work say i caused the meltdown
I didn't cash out but I did
I didn't cash out but I did stop contributing back in July. I'm glad I did. I haven't even wanted to look at my balance.
Got mine out 2 weeks ago
"Lead, follow, or get out of the way."
-- Thomas Paine
A Republic, If You Can Keep It
Most of the smart ones
Most of the smart ones have pulled them and taken the tax hit and invested in things like gold. The US Congress spear-heading the issue is Nancy Pelosi to do away with tax advantages for 401K. People invested in 401Ks originally to defer any tax liability until they took the money out. Now the Dems want to completely eliminate the tax deferment. So why have a 401K ? Gold will do well for you.
Detective Krum Investigates:
http://victory1project.wordpress.com/
http://v1-p.com/
Detective Krum Investigates:
http://victory1project.wordpress.com/
Do you have a link for that?
Seriously, I have thought and expected (and even talked about) this coming down the pike for a couple of years now (it's almost inevitable from the demographic viewpoint... both the Dow reaching 14,000 AND it's inevitable crash are both in part demographic phenomenon as well as being due to Greenspan's idiocy.)
So anyway, if you have any links to Pelosi proposing legislation on this... I'd appreciate it.
kthxbye
How about the IRAs?
The Retrocon
Hope for America, Ron Paul for President in 2008!
The Retrocon
Hope for America, Ron Paul for President in 2008!
I haven't yet
and I have lost alot of money on the screen...
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