Who here is wealthy?

Investment compounding interest > mortgage interest, unless he has a ridiculously high mortgage rate.

Well, he is talking about pretty much taking it out immediately, so I'm not sure it will have much time to compound, not to mention the early withdrawal taxes. Not enough info.

[Roscoe]

This is on a house he already owns? He would be better off putting the max your employer matches in, then putting the rest immediately towards the house principle to reduce compound interest.

Investment compounding interest > mortgage interest, unless he has a ridiculously high mortgage rate.

So me and a coworker have been upping our contributions and he went all in with the max of 35%. He will be maxed out this coming paycheck and for the remainder of the year wants to put the 35% towards hos house principle. Neither of us honestly know what we are doing but I think thats a bad idea. If it is then where should the money go?

This is on a house he already owns? He would be better off putting the max your employer matches in, then putting the rest immediately towards the house principle to reduce compound interest.

[BMCSean]

Are cash value life insurance plans worth a damn?

Depends on the company, the good ones will still take 12-15 years before you are at a breakeven point with your contribution. You can find some that will average 6% compound interest though.

[Sean88gt]

Are cash value life insurance plans worth a damn?

[snacksnack]

So me and a coworker have been upping our contributions and he went all in with the max of 35%. He will be maxed out this coming paycheck and for the remainder of the year wants to put the 35% towards hos house principle. Neither of us honestly know what we are doing but I think thats a bad idea. If it is then where should the money go?

[slow99]

I maxed what they will match for now. It's set up for a Roth 401k Rowe 2050 target date fund (mostly stocks) . With the way our government likes to ruin the future how am I supposed to trust that all this money I put into it will really be there for me down the road? I want to be able to make some money with my investments and use it early.

Right. I meant contribute the max you can to 401k before looking elsewhere - $17,500 this year, $35,000 if married and spouse can contribute at her employer.

[TeeShock]

Lolz yeah. Fwiw tee shock, mine goes 401k, Ira, fidelity brokerage account.

I maxed what they will match for now. It's set up for a Roth 401k Rowe 2050 target date fund (mostly stocks) . With the way our government likes to ruin the future how am I supposed to trust that all this money I put into it will really be there for me down the road? I want to be able to make some money with my investments and use it early.

[slow99]

More specifically, maxing out the part that is matched by your employer. I wouldn't put anything more than that into MY 401K. I'm happy with the free money but the investment options are way to limited.

Yours may be limited but many are wide open. Like Yale said, 'active participant' starts to affect what you can deduct from an IRA contribution as income level rises.

[YALE]

The primary reason you would max out your contributions is to lower your taxable income for the year. Also, a lot of guys don't have the inclination or the time to do research on their investments, so they're not likely to beat an index fund. It's win/win.

[Sgt Beavis]

Its to the point where a stay at home parent will be back imho. Unless there is a way to write it off.

I dont have kids so i dont know wtf you guys go through. I just see dollar signs flying.

Agreed. It is why I'm happy to have my wife at home with our son. She made OK money but a good chunk of that would be gone if we had to use day care. Big bonus for me is that I got a personal assistant out of the deal.

I haven't been employed since 04

That explains..... A LOT.

This. If you haven't maxed out your yearly contributions, don't mess with anything else.

More specifically, maxing out the part that is matched by your employer. I wouldn't put anything more than that into a 401K. I'm happy with the free money but the investment options are way to limited.

[SVT Lurch]

You just have to find what works for you. I was going to get a fourplex and let the tenants pay the mortgage, but the wife said nope. After I got my house lenders wanted 30% down on an investment property,

You can do less if you move into one of the units, then it's considered owner-occupied.

[Roscoe]

Lolz yeah. Fwiw tee shock, mine goes 401k, Ira, fidelity brokerage account.

The problem with that is you don't want to invest in IRA funds and co-mingle pre/post tax funds, or at least that's my perception.

My IRA is my 401k rollovers and my 401k is current employer. After that it's eTRADE for stocks, physical gold/silver, and fidelity investment account...

I'd probably change that stuff up, but someone never told me a direction...

ROTH eligibility stops at $192k/yr household for 2014...

[95ragtop]

You just have to find what works for you. I was going to get a fourplex and let the tenants pay the mortgage, but the wife said nope. After I got my house lenders wanted 30% down on an investment property, but since I wasn't making Choo-Choo $$$ yet I just threw it into the stock market. I have looked into small side businesses, but being in the military and moving every several years really screws with that.

If I could live in one place I probably get into car washes, vending machines, laundromats, or storage units.

But since I can't I plan on following something like this in the next several years.

http://www.biggerpockets.com/renewsblog/2012/12/12/make-a-million-dollars/

[Y2KSilverGT]

listen t.o slow99 - max your 401k + Roth IRA and let the markets do the heavy lifting for building wealth (ie compound interest)

A good book to read and applies to everyone baller or non-baller is The Richest Man in Babylon

It's your lucky day dfwmustangs here is a free link http://www.ccsales.com/the_richest_man_in_babylon.pdf

You are welcome