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Technical Anyone ever cashout some of their 401k or IRA for a Hot Rod investment ?

Discussion in 'The Hokey Ass Message Board' started by low budget, Oct 27, 2019.

  1. Hemiroid
    Joined: Nov 6, 2011
    Posts: 135

    Hemiroid
    Member

    Ha ha...
    Yep sir, 401k is my highway to not working anymore...
    No 401k, you better be putting money away in a IRA...
     
    scotty t likes this.
  2. squirrel
    Joined: Sep 23, 2004
    Posts: 47,821

    squirrel
    Member

    Interesting reading all these posts....and then reading the post about how old we really are. Yes, I'm in the 51-60 group. Enjoying retirement. We took saving for it seriously.

    old.jpg
     
  3. ...what's these 401's and IRA's you're talkin about, never heard of em,...workin on my 3rd million, gave up on the first and second....
     
  4. thirtytwo
    Joined: Dec 19, 2003
    Posts: 2,640

    thirtytwo
    Member

    I knew an old iron worker said he always wanted a 34 roadster ...one day a decent one came along fairly cheap , thought about pulling money out , but decided not to... talked about 34 roadsters until he died ..2yrs later
     
    nochop, swade41, F&J and 1 other person like this.
  5. solidaxle
    Joined: Jan 6, 2011
    Posts: 529

    solidaxle
    Member
    from Upstate,NY

    When I set up my companies 401K, I thought it was a great idea to have the employees be able to borrow against their saving and pay themselves back. One bought a truck and then had a divorce, he went into default. Another had two loans out. When we got slow and he went on unemployment, he couldn't afford to pay the loans and went in to default. Default means claiming it as income on your taxes and there's penalties involved. I would never recommend using your retirement savings to buy toys.
     
  6. Well I cashed out my 401K when I turned 50. Not to build a hot rod, I went from whatever I was making at the time to zero in about 5 minutes and had to live for 6 months before SSD kicked in.

    That said I have borrowed against a 401K to buy parts or project cars before. Borrowing against it is your best bet you repay it with interest and you are paying the interest to yourself.
     
  7. olscrounger
    Joined: Feb 23, 2008
    Posts: 4,086

    olscrounger
    ALLIANCE MEMBER

    We never touched it and contributed the max. I am now 76 and have had to take the RMD for the past few years, wife has a few years to go before she has to take hers. Now just pay the taxes on mine and bank the rest. Always found another way to buy/play with cars, etc.
     
    5window, Gman0046 and lothiandon1940 like this.
  8. "401K"? Self employed machinist.....................yeah, right!
     
  9. [QUOTE="porknbeaner, post: 13389739, member: 1613")

    That said I have borrowed against a 401K to buy parts or project cars before. Borrowing against it is your best bet you repay it with interest and you are paying the interest to yourself.[/QUOTE]

    That really depends on what you have it invested in. If it’s in stock or commodities and the price goes up after you borrow then your hurting yourself. You are in effect selling low and buying high.
     
  10. finn
    Joined: Jan 25, 2006
    Posts: 761

    finn
    Member

    Resist the urge to touch your 401k and you’re going to be alright. Nothing, not even a hot rod, is worth screwing up your RMD.

    Look at all the guys that panicked in 2007-2009 and cashed out. They missed out big time.
     
  11. Bandit Billy
    Joined: Sep 16, 2014
    Posts: 7,431

    Bandit Billy
    ALLIANCE MEMBER

    Another thought on this subject that I heard a long time ago. If you want a new toy (boat, car, HD, blonde, etc) spend the profits not the principal. If you were invested in the market in 2019 you made at least 16% (the market made 24%). Without hitting your nest egg there is money (gravy) you can spend. But take the nest egg and you are digging a hole and that is no place to be when the rains come.
     
  12. 5window
    Joined: Jan 29, 2005
    Posts: 7,942

    5window
    Member

    The rains are coming, for sure. But, you are right. Never touch the nest egg. You got a health problem money could fix but it's in your hot rod? Best of luck and I can buy it at your estate auction.
     
    upspirate and Bandit Billy like this.
  13. Yep, just did that exact thing last sat. Not as an investment, but to finally get the car I wanted for the last 9yrs or so. Thanks to your buddy Trump, I doubled my money in 2yrs, after he was elected, hahaha. 22% in taxes is pretty steep, but would have had to pay up sooner or later.
     
  14. I got shit from some of my friends, but I don't care. Tomorrow is guarenteed to nobody. Gonna enjoy it while i'm still breathing, lol. I've known quite a few guys who have died with tons of money in the bank, and never took the time to enjoy life.
     
    F&J, scotty t, swade41 and 1 other person like this.
  15. upspirate
    Joined: Apr 15, 2012
    Posts: 2,262

    upspirate
    Member

    True, but there is a balance....If I had only put $5 wk away back when I started with UPS in '73, it wouldn't have hurt my lifestyle, and I'd have plenty for retirement and playing. As it was, I was lucky enough to listen to the Tractor-trailer UPS guys starting when I was 30 and was able to catch up. I still bought cars/boats/travel, and am comfortable.
    When my last rod went around the corner, I went inside and paid half of my mortgage. Great feeling, and I still didn't go without
     
  16. stanlow69
    Joined: Feb 21, 2010
    Posts: 5,154

    stanlow69
    Member
    from red oak

    While you guys go out and take loans for a new car or truck. Or upgrade on a house. Or go buy a new toy. When that money should be going into a retirement account. And you are telling me not to take money out when I retire.
     
  17. 392
    Joined: Feb 27, 2007
    Posts: 1,200

    392
    Member

    I never would but to each there own.
     

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