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401k Question - To pull money out, or leave it
Hello everyone. I am new to investing and getting very close to finally getting my feet wet. Over the last couple of years my mindset has turned 180 degrees and I now look for investments rather than higher paying more work intensive jobs. So my current issue is.... Do I take the money out of my employer 401, or leave it? My goal would not to have to work for anyone ever again in the next 5-10 years, and live mainly off of my investments. I only have about $20,000 in there now, and assuming taxes and 10% penalty I'd probably come out with $12,000ish. This could give me a jump start on down payment for rental properties or rehab houses, etc.
What do you all think? I see no reason to further contribute to my 401k, as it's not a great investment in this day in age. And I think since I have such a little amount it in anyways, I don't see the point of rolling it over to a solo 401k or IRA and trying to invest with it. I feel like by just taking the penalty and pulling whatever is left out, I could get a quicker jump start on my investing. I am only 24 years old and eager to get started.
Please let me know your opinions and advice! Much appreciated!
Most Popular Reply
I'm considering same thing but I'm looking at doing the loan instead of taking it all out. I bet you could take the loan and get $10k (typically 50% of invested/vested amount). You'd still have rest instead of losing it all. I would love to hear other ideas.