401K Maxout chesthunara?

[FrustratedVuncle]

3 minutes ago, Konebhar6 said:

You are correct. I calculated taxes on profits but did not remove 30% pre-tax. Based on that the 10-yr net comes to $250000. So putting in 401k is better even including the penalty.

Like I mentioned I have maxed out 401k till now and have good amount there. I don't know how it will be useful to me after I retire. I would rather have that money now. Everyone's life is different. I have'nt made the decision and If I cant I will stay put.

After retirement if you are solely depend on social security check, it will not be sufficient so that's when 401k is handy no. Based on your 401k saved amount 4% withdrawal is recommended, so that the funds last longer while growing 

[Aquawomen]

Just now, FrustratedVuncle said:

After retirement if you are solely depend on social security check, it will not be sufficient so that's when 401k is handy no. Based on your 401k saved amount 4% withdrawal is recommended, so that the funds last longer while growing 

vesukunna covid vaccine ki and daily indian food and biryani heart gilla gilla kotukutndhi desis inka.

enduku vayya 65 years lo money gurunchi alochicnhi time waste chesukovadam 

[Konebhar6]

7 minutes ago, FrustratedVuncle said:

After retirement if you are solely depend on social security check, it will not be sufficient so that's when 401k is handy no. Based on your 401k saved amount 4% withdrawal is recommended, so that the funds last longer while growing 

Of course that's the whole purpose of 401k. 

[FrustratedVuncle]

43 minutes ago, Aquawomen said:

vesukunna covid vaccine ki and daily indian food and biryani heart gilla gilla kotukutndhi desis inka.

enduku vayya 65 years lo money gurunchi alochicnhi time waste chesukovadam 

65 yrs age lo money gurinchi alochinchakunda undali ante ipudu chinchali kadanna. 23 nunde 401k lo contribute Cheste yearly 5k vesina chalu, pedda noppi kuda teliyadu

[rmJU72]

Just max it out. Think like you are investing in different categories…and don’t compare each category.

1. 401k - max pre tax plus employer match if any. Locked until retirement so that you are prevented from touching it.

2. RE investments - in US, India 

3. Stock brokerage like fidelity or robinhood.

4. Gold

[SwethaMandava]

thanks everyone for explaining this stuff.

decided that i am going to max out 401k and let it compound pre-tax money for retirement.

 

[Konebhar6]

7 minutes ago, SwethaMandava said:

thanks everyone for explaining this stuff.

decided that i am going to max out 401k and let it compound pre-tax money for retirement.

 

Good decision. It also makes you force save and live within the remaining salary and cut unnecessary expenses.

[Galactus]

3 hours ago, Konebhar6 said:

I have always maxed out. But thinking to change strategy now. See analysis before

Criteria:

• 401k:You invest $23,000 every year for 10 yrs. Lets assume you make a yearly gain of 10%.
• Outside investment:You invest $23,000 every year for 10 yrs. Lets assume you make a yearly gain of 10%. You also pay a 30% tax after each year.

 

 

	401K	Regular Investment
Total Amount (10yrs)	$403,216.84	$340,022.00
Your Investment	$230,000.00
Taxable amount	$173,216.84
Tax (30%)	$51,965.05
Amount after retirement	$351,251.79	$340,022.00
10% Penalty	$40,321.68
Total Amount	$310,930.10	$340,022.00

You are only making 11K more in 401K after calculating all taxes. However if you withdraw before retirement, its huge difference. Investing outside is better. 

Decide yourself.

 

 

Company match marchipoyavu

[Konebhar6]

Just now, Galactus said:

Company match marchipoyavu

I advise everyone to put atleast the amount that the company is matching. No brainer. Hence did not consider it.

Actually I suggest everyone to max out 401k. I have a good amount in 401k, so thinking if I need to contribute further. But for others its simple - Max out if your finances support

[perugu_vada]

nenu match chestha anthe .. i wont max-out .. reason being .. epudo 65yrs+ kosam ani .. ipudu dhaachi .. apudu untaamo pothaamo kuda teledu /. enjoy now .. also by 65 elago we would have got house .. dhani medha equity chaala build autundi .. can use that money by seling it off .. elaago kids wont be with us .. and we dont need such a big house 

[Tellugodu]

On 11/12/2023 at 8:28 PM, SwethaMandava said:

meru 401K just employer match varaku peduthunara leka max chesthunara?

max chesthey retirement varaku bayataku teeyalemu, dhani kanna manam bayata invest chesthey better aa?

Please suggest.

I max out on my 401k, the reason being- my employer match 50 cents for every dollar invested up to IRS limit. I think it better to max out if you are in high tax bracket.

[Tellugodu]

15 hours ago, Konebhar6 said:

Inta ghoramgaa eppudu chudaleedu. Usual ga between 1-3 yrs untundi ...

Mostly tech companies lo no vesting period. 

[summer27]

35 minutes ago, Tellugodu said:

I max out on my 401k, the reason being- my employer match 50 cents for every dollar invested up to IRS limit. I think it better to max out if you are in high tax bracket.

ante 22k nuvvu invest cheste employer 11K istada??

[Tellugodu]

20 minutes ago, summer27 said:

ante 22k nuvvu invest cheste employer 11K istada??

Yes bro. 

[SaradaChinnodu]

nenu used to max out 401k pre tax now maxing out post tax coz

1) I would like to know how much I can withdraw at any given point if I have to go back to India (so post tax aithey you only pay taxes on gains) and post tax 5 years aithey you can withdraw without penalty on the invested amount ani vinna....

2) I would not know how the tax brackets will be 20+ years from now on..

 

Someone can clarify if I've misinterpreted post tax scenario and also let me know if its not so good idea compared to pre tax....