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Jess White
  • Rental Property Investor
  • San Jose, CA
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Turns out, the 401k is not a scam.

Jess White
  • Rental Property Investor
  • San Jose, CA
Posted Sep 10 2019, 14:14

Something I used to believe whole heartedly, several years ago was that the 401k is a scam. Tons of books on Real Estate preach that to the masses, which can unfortunately be terrible advice for those in the middle.

But I’ve recently had a change of heart. It’s not a scam and you should definitely being doing it if you have a 9-5. (And as a real estate investor).

There’s so many benefits as long as you are in a good low fee index portfolio. Even deploying 401k loans to buy real estate, which I think is one of the best kept secrets in getting started real estate investing.

Heres one of my personal favorites. Imagine one day (very unlikely but possible) you have to file bankruptcy due to a terrible life situation, or rough economic times, ETC. You've built a big real estate portfolio and then BAM. You're wiped out. ****Except your 401k and IRA's. They are federally protected during bankruptcy. Creditors can't touch that money, that is insane. it's like having a backup, real cash insurance policy and you wouldn't have to start from zero. Why would anyone pass up on that?

I max mine out, along with all the the other tax advantaged accounts and I also invest heavily in Rental Real Estate as well. So why not JUST DO IT ALL? I’ve yet to meet anyone who regretted money they put away in a retirement account, when they are older.

What about you, Do you like the 401k? Is it a “Scam”?

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