Author Topic: Anyone NOT max out their retirement accounts?  (Read 1938 times)

freeazabird

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Anyone NOT max out their retirement accounts?
« on: August 30, 2014, 11:46:54 PM »
I was wondering if any of you are for one reason or another not maxing out your retirement accounts and instead using after tax funds to invest in real estate? What about retirement accounts turned you off to maxing them? How much have you invested so far? What are your returns like?

marty998

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Re: Anyone NOT max out their retirement accounts?
« Reply #1 on: August 31, 2014, 04:26:24 AM »
Hmm....I would have to wait 27 years to access the funds.

A lot can happen in that time.

MillenialMustache

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Re: Anyone NOT max out their retirement accounts?
« Reply #2 on: August 31, 2014, 06:05:56 AM »
We have money going into retirement (about 12% of our pay, matched by our employer). We also have Roth IRA's with a little money (less than $10,000 total). However, the money we save out of our take-home pay no longer goes towards traditional retirement. We are 27 years old, so we will not be able to access that money for more than 30 years. We are hoping to retire much sooner, so we are investing in real estate. We have purchased our first rental home and after the mortgage, insurance, and taxes we are bringing in about $550 extra per month. Some of that will be used for repairs and such down the line, but we are hoping to keep those costs low since my husband is very handy. Hope that helps answer your question, feel free to ask more.

monarda

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Re: Anyone NOT max out their retirement accounts?
« Reply #3 on: August 31, 2014, 08:33:20 AM »
I don't have a 401K or anything with match from my employer.
We have IRAs but don't max them, we were putting our extra savings back into the rentals for remodels.  Most of our net worth is equity in real estate (~80%)- I had a thread on this a month or two ago.

We want to keep all of the cash liquid for the next few years until the next roof we have to replace is done. Then we'll both be close to 60, not sure if it'll make sense to contribute to IRAs then or not. If there's a tax benefit at that time, maybe we will.  Does this answer your question?

waltworks

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Re: Anyone NOT max out their retirement accounts?
« Reply #4 on: August 31, 2014, 08:55:26 AM »
You will be able to access the money earlier with no penalties if you're smart. Go google up SEPPs or 401k-laddering.

I'll get you started: http://www.madfientist.com/traditional-ira-vs-roth-ira/

Real estate is great if you are getting good numbers on properties but it's awful in comparison to tax-advantaged retirement accounts unless you are finding amazing deals on rentals or getting crazy lucky with appreciation.

-Walt

arebelspy

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Re: Anyone NOT max out their retirement accounts?
« Reply #5 on: August 31, 2014, 10:35:55 AM »
MOD NOTE - Duplicate topic here: http://forum.mrmoneymustache.com/welcome-to-the-forum/anyone-not-max-out-their-retirement-accounts/

I understand you're looking for more real estate information, but with the thread title and first sentence, this is just more of the same, and you're going to get a lot more 401k/IRA discussion (see: the few replies already).  You may want to have one with a more real estate slant (i.e. not talking about maxing retirement accounts) to get what you're looking for without getting those type of replies cluttering the thread.

Locking thread. 
We are two former teachers who accumulated a bunch of real estate, retired at 29, spent some time traveling the world full time and are now settled with three kids.
If you want to know more about us, or how we did that, or see lots of pictures, this Business Insider profile tells our story pretty well.
We (rarely) blog at AdventuringAlong.com. Check out our Now page to see what we're up to currently.