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Im back lol! AGAIN! lol

January 8th, 2013 at 11:35 am

Well a lot has changed:
*Quit my Job in March 2012 and I now work from home
*Cashed out my 401k and put it in my Savings
*Doing a new 52 Week Savings Challenge for 2013
Week 1 $1, Week 2, $2 etc...by then of the year I should have $1378.00 in both my daughter and my Savings account with ING. Picture is below if anyone wants to do it. Smile

9 Responses to “Im back lol! AGAIN! lol ”

  1. BuckyBadger Says:

    Eeeek! Why did you cash out your 401k just to put it into savings? Did you really just take the giant hit in taxes and penalties and then put it in a savings account?

    I like the idea of the savings challenge, though. Very nice!

  2. jacquelynrose Says:

    Nope it wasnt a giant hit and I would rather have control over my money

  3. BuckyBadger Says:

    So you are planning on putting it into a taxable investing account? Why invest in a taxable account when you can invest in a tax advantaged account?

    10% on top of having to pay taxes is a pretty big hit in my opinion. When federal and state taxes and the early withdrawal penalty are accounted for, you're giving up at *least* 35% of your funds. In addition you're losing out on dozens of years of tax free compounding returns, and you are giving up tax advantaged space that you will never ever be able to get back.

    If that's a choice you want to live with, fine, but I hope the readers of your blog realize just what you gave up by doing so and that they think twice about doing the same thing.

    Would you at least consider putting it into a Roth IRA at this point?

  4. jacquelynrose Says:

    No. You dont know the details of my 401k and I dont need to explain what I do with my money with anyone. But thanks for your input.

  5. BuckyBadger Says:

    That's fine. But unless you're different from every other person in America, you had to pay taxes and an early withdrawal penalty.

    I'm not trying to change your mind -- I'm just trying to make sure that people know what they're getting into if they decide to do the same thing. And people who read your blog should know what they're giving up.

    So my input is for your readers, not for you.

  6. Petunia 100 Says:

    Welcome back. It looks like you last posted about a month before I landed here, so I'm new-ish.

    I also think rolling to an IRA and then investing any way you pleased (even cash) would have been the better thing to do. But you are right, it was your money to do with as you thought best.

    Best of luck to you with your goals. Smile

  7. scfr Says:

    As Petunia 100 mentioned, rolling the 401K money in to an IRA is a way to control where the money goes, delay paying taxes, and avoid the 10% penalty. If it hasn't been 60 days since you cashed out, you can still do it.

  8. Jerry Says:

    How did you manage to lead yourself into a situation where you can work from home, I wonder? Are you enjoying the change? Does the new gig offer insurance and other benefits, or do you have to manage that yourself? I wish you well with your saving challenge!
    Jerry

  9. creditcardfree Says:

    How are things going for you financially? I came across your blog as Favorite from someone else who posts on SA, so I thought I'd see if you had an update you wanted to share.

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