Put more in 401K or invest elsewhere?

[autoxer]

Do you realize that contributions to retirement accounts are not tax deductible, but only tax deferred, and that you will pay ordinary income tax (much more than capital gains tax) on every dollar you take out at some point?

You continue to regurgitate this, but deferring the tax is still better than paying the tax right now. Especially in the higher tax brackets.

I know have two businesses that net me about $285K a year of passive income...

You could even shelter some of that precious income from tax too, if you weren't so afraid of the system.

[Nutria]

But remember this: The Herd is usually wrong.

Everyone says this, but think hard about a herd of cattle. Even better, a herd of sheep: someone feeds them, protects them, takes care of their ailments and lets them boink whenever they want to. Pretty clever for supposedly stupid animals...

[LivingAlmostLarge]

Yes i like working for the man and prefer punching a clock. I've even told my mom that whose told me to go work for myself. i am not that sort of person. I know my nature. I like boring routine.

If it works for you great get a business and make passive income. But i refuse to believe that buying those passive income businesses and getting them off the ground occurred without some effort.

[TexasHusker]

You continue to regurgitate this, but deferring the tax is still better than paying the tax right now. Especially in the higher tax brackets.


You could even shelter some of that precious income from tax too, if you weren't so afraid of the system.

Deferring tax is often a good idea, but not when it involves giving someone else your hard-earned dollars for a few decades and hoping THEY do something smart with it.

I take every shelter the system allows, as long as it makes good cents otherwise.

[TexasHusker]

Yes i like working for the man and prefer punching a clock. I've even told my mom that whose told me to go work for myself. i am not that sort of person. I know my nature. I like boring routine.

If it works for you great get a business and make passive income. But i refuse to believe that buying those passive income businesses and getting them off the ground occurred without some effort.

No good investment comes without effort. But with stocks, bonds, and mutual funds, you are hoping that SOMEONE ELSE puts in the effort. A big risk.

[TexasHusker]

Everyone says this, but think hard about a herd of cattle. Even better, a herd of sheep: someone feeds them, protects them, takes care of their ailments and lets them boink whenever they want to. Pretty clever for supposedly stupid animals...

If you need a shepherd, then you should rent, buy mutual funds, and work for the man.

[autoxer]

If you need a shepherd, then you should rent, buy mutual funds, and work for the man.

It sounds like you are just following a different shepherd, probably Robert Kiyosaki. He may be a good shepherd for some people, but that doesn't make him right for everyone.

[Nutria]

It sounds like you are just following a different shepherd, probably Robert Kiyosaki. He may be a good shepherd for some people

The same Robert Kiyosaki who never had the claimed wealth before publishing RD/PD, and who's company short changed people on required royalties, got sued, lost and had to file bankruptcy? http://www.forbes.com/sites/helaineo.../#69ceb58917d7

That Robert Kiyosaki?

[corn18]

If you need a shepherd, then you should rent, buy mutual funds, and work for the man.

I remain weary of the implication you so persistently convey.

[tripods68]

If you need a shepherd, then you should rent, buy mutual funds, and work for the man.

So tough to digest a lot of what you say as contrarian, but this is a savings advice forum, that often disagrees with other peeps, nothing wrong with that.

[autoxer]

The same Robert Kiyosaki who never had the claimed wealth before publishing RD/PD, and who's company short changed people on required royalties, got sued, lost and had to file bankruptcy? http://www.forbes.com/sites/helaineo.../#69ceb58917d7

That Robert Kiyosaki?

Yep, that's the one. He has very similar views as TexasHusker on real estate and mutual funds.

[TexasHusker]

I remain weary of the implication you so persistently convey.

I think there might be a ignore feature on the forum but I'm not certain.

[TexasHusker]

So tough to digest a lot of what you say as contrarian, but this is a savings advice forum, that often disagrees with other peeps, nothing wrong with that.

Risk means different things to different people.

Some rate a savings account as the lowest risk. I rate it as the highest risk because the money is guaranteed to do absolutely nothing.

Some people rate mutual funds as modest risk because someone else is making all of the investments on their behalf. However, due to their sheer size, MFs are inherently mediocre by their very nature. Again, there's a pretty decent chance that money is going to only increase modestly, if at all. And in a 401K, it isn't your money until you retire. In my book, that's a highly risky venture.

Real estate is the lowest risk investment, if you're not a complete idiot. I bought a vacation home to rent out back in 2005 at the top of the market. It is worth $75K LESS today than I bought it for 11 years ago. HOWEVER, the rental income has essentially paid me back every dime, so if I had to sell today, I'm walking away with $200K in profit even with the value decline.

You can overpay for property and still make stupid money in real estate if you have a little patience.

The least risky investment is your own business. That is because you are in complete control, and aren't dependent upon the integrity and acumen of someone else.

[Nutria]

Some rate a savings account as the lowest risk. I rate it as the highest risk because the money is guaranteed to do absolutely nothing.

I think you misunderstand the definition of the word "risk".

[autoxer]

The least risky investment is your own business. That is because you are in complete control, and aren't dependent upon the integrity and acumen of someone else.

I think my business is more risky than my mutual fund, but has more potential for a higher return on investment. My business has many different kinds of risk, pressure from competition, potential litigation, general market conditions, while my mutual fund is diversified across hundreds of different businesses. If any one of those businesses fail, it doesn't have a significant impact on my net worth.