Posted on 06/10/2011 12:31:19 AM PDT by Nachum
The list, ping
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I think the better action would be to live within your means before considering loans.
Or perhaps, you pretentious asses, the American people have finally realized that their financially more "literate" betters, are using their "superior" connections...oops, ahem...I mean "knowledge" to figure out brand new ways to relieve them of the balance of their accounts, and have found a better investment. Couldn't be that now, could it?
Grandpa bought farm ground during the Depression for $50/acre. God, what a tragedy that he didn't invest in the "market" so that his betters could take care of his money...LOL!
retirement is a thing of the past. our life as we know is gone.
I wonder what percentage are under water (account value fell to less than value of the loan) ?
I wonder of those how many just defaulted on the loan and disappeared ?
Nobody forces these poor people to borrow against their 401K’s. And, that is not to say that it is the major part of their retirement...I don’t trust the government enough to use their 401K or IRA schemes. I just invest for myself, thankyou...
Life is risky...each individual decides for themselves what level of risk is comfortable. Each individual is responsible for their own production and property. There is nothing government can do about that without destroying wealth.
It soon won’t matter. The paper money will disappear through either hyperinflation or the collapse of the currency. It won’t matter if it is in a savings account, insured CD, government bonds, or the stock market.
We are experiencing the collapse of Western Civilization.
Always the optimist! /s
This is a huge potential problem in this 0bama economy. You could walk into work one day, find you've been downsized then, oh by the way that $50K loan you took, it's due in 60 days or you get severe penalties from the IRS.
I've come to that conclusion myself. Over the last 2 years being on again off again employed I've set up an account where I take a couple hundred $ a month out automatically while I'm working and put it into an account that isn't easy to tap. When the hot water heater went, I had the money to pay cash and I even got the plumber to accept cash with no receipt in return for a nice discount on the job. A win-win from my perspective.
Spot on true.... Live within your means be times good or bad and life will be easier.
May as well take it now because we’ll be lucky if it’s there or if it’ll be worth anything in 5 - 10 years.
It’s a big problem because the government can’t outright confiscate it if it’s not in your 401K...
1. I got a much better interest rate on these loans than I ever could have gotten through traditional bank financing.
2. I used my cash in my 401(k) account and cashed out a big chunk of my bond mutual fund in my 401(k) plan for this loan. I was getting a very small return (less than the interest on the loan) on those things.
3. Since the loan is used for business purposes, the interest is tax-deductible.
4. So, in effect, I've taken out a loan where the interest payments are tax-exempt, and I'm paying myself back and getting a better "return" on the money than I would have gotten if I had left the money in the 401(k) plan.
5. Another minor consideration is that the remainder of the funds in my 401(k) plan serve as collateral for the loan. If the economy collapses, or by some small chance the U.S. government starts seizing 401(k) accounts from private citizens, then I have no qualms about defaulting on the loan, walking away, and leaving Uncle Sam and the 401(k) custodian to fight over who gets the remaining crumbs.
The Org that I work for has placed every restriction you possibly could on our 401’s. No cash out or loans, no nothing till 59. I think they were very smart to do this.
Conceptually speaking, I agree with you. If you’re in a secure position, it’s ok to financially strategize, to create the best position for yourself.
However, I don’t think that, as long as the Republicans and Democrats and Obama are not willing to take the financial health of their country seriously, there really isn’t a good way to strategize at the moment, other than to assume that you could lose your job tomorrow and live accordingly.
I wonder of those how many just defaulted on the loan and disappeared ?
Shhhh!
When your government and those in the banking cartels are almost entirely violent sociopath kleptocrats, your money is good as gone.
The growing ex-pat communities around the globe are doing fine. Do you have your escape route planned or are you shooting for the martyr route?
It’s the new version of a home equity loan.
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