San Francisco, CA · Member since 2016 · 38 posts · 8 votes
I was wondering if i could get everyone's thoughts on not investing into my 401k and Roth IRA anymore. I currently utilize my companies matching of 6% and put 250 a month into my Roth IRA. Been really hands off of my 401k and just took a look at how much i put in monthly It averages to $750 a month. I dont plan to stay with the company for more than 2 years and dont mind taking risks since im relatively young (27). Any thoughts and comments are welcomed! Currently thinking of using my savings (8K), Roth IRA(12K) and pulling a loan against my 401k (45K total, this would be my last option if i needed more money to acquire properties, since i dont plan to say with the company for that much longer) to purchase my first investment property for buy and hold purposes.
Personally I am not touching my 401k. Some have rolled it over to self directed IRA to invest due to being tax deferred. But this will be a personal choice.
I plan to leave it in the stock market to be diversified and use my taxable account for RE investing.
Also I believe if you take a loan on the 401k and quit your job, you have to pay it back in lump sum or you get penalized and taxed.
I would continue putting money into your 401k, especially if your job will contribute as well. You never know when you will need to take out a loan against it.
You can live frugally and dedicate other capital towards real estate.