at work what should a person do.............start an IRA or increase hiscontribution to the 401K at work? Its happening with more companies, new employees not being offered a pension fund or existing pensions being froze without further contributions.
If someone is already contributing to a 401k or a 403b AND can afford to do more, then the initiation of a Roth IRA is a very good thing. If one can afford to do even more than the maximum allowed on their Roth per annum then more to the 401 or 403 is fine.
Location: On an Island in the west coast of New England
Posts: 13,133
RE: In lieu of a retirement fund........
Both are great ways for long term savings. The beauty of a 401K is that there is usually a company match up to a certain percent. In addition, if you put your money in pre tax it is a way to shelter some income on a yearly basisif you are in a higher tax bracket. The Roth is good because it's earnings are all after tax. Save in both and you wll be ahead in the long run.
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Too busy with fishing to spend much time here.
at work what should a person do.............start an IRA or increase hiscontribution to the 401K at work? Its happening with more companies, new employees not being offered a pension fund or existing pensions being froze without further contributions.
Both. If you make less than 100K a year or so, definatlely start a Roth IRA. If you can afford, then contribute 15% of the 401K. After that you can look into Life insuranceto hide some money, but those tax loopholes are starting to go away. After that, start looking into the IRA's.
Do both if you can. However, if you have to choose because you can't afford to do both, contribute to the 401k (deferred taxes) up until the match percentage of your company, then put the rest in the Roth (no taxes).
Forget the tax benefits unless you are making serious big bucks. Take the money and go buy a piece of land!
You will have a place to hunt , fish and spend time with your family. And the value of land will increase far more than the value of your 401 and you will not have to wait till your 59 & 1/2 years old to enjoy it.
A Roth is a great way to go. However, I'd also check out buying land... (they're not makin' it anymore). Good appreciation over time, as long as taxes don't eat you alive.
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If you always do what you always did, you will always get what you always got.
my company froze (stopped) all its retirment contributions. I was 5 years and vested, so I'll get a small part.
when this happened, they also raised the matching in 501 K to 5% I believe it is, thus I started contributing to 401K which I was reluctant to do. I chose the highest risk fund, placed it all there and won't look at it until 2012, maybe 2014 depending on if Dem's win back to back Presidential runs.
I think the stock market will be very good the next 3-4 years.
If you buy land now you will not have to worry about future elections and you will be free to start using it right after the closing.
And pay state tax's on it every year, with the chance of losing a ton of money dependin on location, and usually the best location to make money, has the highest state tax's.
In lieu of a retirement fund........
