401K Maxout chesthunara?

[summer27]

17 minutes ago, Tellugodu said:

Yes bro. 

employer contribution limit undada?

 

[perugu_vada]

Just now, summer27 said:

employer contribution limit undada?

 

general ga employer contribution 3-6% untundi .. covid times lo employer contribution 0 chesaru 

[former]

14 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.

 

 

You can't withdraw the money same time? 

The outside legitimate investment also needs to pay tax on capital gains.

[former]

10 hours ago, Konebhar6 said:

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

I just started to contributing to 401K and plan to max out for next 10 years. 

After that I can't contribute if kids wants to go to college. The expenses will go higher higher till kids go to college.

The first 10 years money will compund for next 20 years will have decent sum at the Retirement. 

Bachelors ga max out chesthe they have 40+ years to compund & will have decent sum.

[former]

10 minutes ago, summer27 said:

employer contribution limit undada?

 

The max you can do $66,000 for both you and your employer.

[Tellugodu]

22 minutes ago, summer27 said:

employer contribution limit undada?

 

No limit on employer contribution limit. 50% match upto IRS .

https://www.ignitefinancialplanning.com/amp/microsoft401k

 

[quest]

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.

kallu moosukuni max out cheyyatame if you have the luxury of putting that much money in..

DO NOT invest in India, you will never get that money back without paying a lot of taxes

 

 

[perugu_vada]

i dont understand .. y u ppl are trying to max  out ur 401k ? House loan aipotundi by 65 .. ah money em chestaru ?

we have to come out of the fact that .. kids kosam savings ani .. so you have money you get after selling ur house .. which itself will be a million or so by then .. 

just dont take too much pressure w.r.t 401k .. 

[Konebhar6]

1 hour ago, former said:

You can't withdraw the money same time? 

The outside legitimate investment also needs to pay tax on capital gains.

I did calculate the 30% tax and removed from investments each year. However I missed the 30% pretax so the investment outside is only 17k/yr. 

Investing in 401k comes out much better even including penalty.

[Konebhar6]

2 hours 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.

Lucky you. That's one of the best I have heard. Ours is profit sharing. Whether I contribute any money in 401k or not, company puts 5% of salary into 401k. 

[Konebhar6]

1 hour ago, former said:

I just started to contributing to 401K and plan to max out for next 10 years. 

After that I can't contribute if kids wants to go to college. The expenses will go higher higher till kids go to college.

The first 10 years money will compund for next 20 years will have decent sum at the Retirement. 

Bachelors ga max out chesthe they have 40+ years to compund & will have decent sum.

You will be surprised. After 10 yrs your earning potential goes up and you can still contribute if you want to towards 401k even with your kids education. It might be tough for 2-3 yrs when both kids are in college at same time. 

[perugu_vada]

28 minutes ago, Konebhar6 said:

Lucky you. That's one of the best I have heard. Ours is profit sharing. Whether I contribute any money in 401k or not, company puts 5% of salary into 401k. 

 

27 minutes ago, Konebhar6 said:

You will be surprised. After 10 yrs your earning potential goes up and you can still contribute if you want to towards 401k even with your kids education. It might be tough for 2-3 yrs when both kids are in college at same time. 

@Konebhar6 uncle .. if u have 2 paychecks or more and earning handsomely .. then 401k max chesina ok .. still i dont get the point .. of what u gonna do with properties in India (which I suppose many in this DB must have had) avi elago kids here will not use it .. so adhi savings kindha k osthaay .. unelss u let it go to someone else in India for free 

ikada house loan pay off chesestham .. antha big house lo undamu .. as kids will leave out .. and visits once in a while .. so ah house equity untundi .. 

my point here is, y to work our a$$ off and save for 65+ ? when we dont know, if we will be at peace staying hjere in US or in India or elsewhere after retirement

[FrustratedVuncle]

54 minutes ago, perugu_vada said:

i dont understand .. y u ppl are trying to max  out ur 401k ? House loan aipotundi by 65 .. ah money em chestaru ?

we have to come out of the fact that .. kids kosam savings ani .. so you have money you get after selling ur house .. which itself will be a million or so by then .. 

just dont take too much pressure w.r.t 401k .. 

The question is why not? what would you do with that money?

[perugu_vada]

1 minute ago, FrustratedVuncle said:

The question is why not? what would you do with that money?

401k max out is fine .. if one has excess money .. but i have seen families who look to save on small things becos they can not afford them .. and are saving hell alot for future

[FrustratedVuncle]

11 minutes ago, perugu_vada said:

401k max out is fine .. if one has excess money .. but i have seen families who look to save on small things becos they can not afford them .. and are saving hell alot for future

of course paisal extra unnode investment joliki povali. Nithyavasarlu ki lekunda investments evaru chestaru. 

It goes without saying, its stupid idea to pay credit card interest while doing other investments, Unless you are on to a secret jackpot.