FORUMula1.com

[Jabberwocky]

I was being serious, so it is like paying into the state pension?

[geetface9]

I was being serious, so it is like paying into the state pension?

Word, I hope I caused no offense, just didn't know it was only an american thing. It's pretty much the same but the account is in your name, it's your money, you can pull some out if you need, albeit with some steep % rates. You're not meant to pull any money out of it until you retire, but if you do pull it out early they can charge you about a 10%-20% fee.

[What's Burning?]

I was being serious, so it is like paying into the state pension?

That would be socialistic and America is homophobic (for lack of a better word) about socialistic ideas.

I'm one of those rare individuals now days that's employed by an old blue chip company, where they do have a pension and like Geet said a 401K. But there are distinct differences between a pension and the 401K.

The 401K is a way to divert money you make today into an account where you will theoretically use that money in the future when you're retired and you're not earning money or earning little money and so the taxes you'll pay on the money you withdraw will be minimal. So the essence of it is deferred taxed income but also some form of retirement savings.

Some companies will "match" a percentage of what you put into the account, they'll also throw in some profit sharing dollars into that account so in most cases you wind up getting a 100% or greater match per dollar from the money you put in. The account is also managed by a financial services company where the money in it is in a managed stock portfolio so it has the potential to grow along with the stock market as a whole.

More than you ever wanted to know about 401ks.

[darwin dali]

I was being serious, so it is like paying into the state pension?

That would be socialistic and America is homophobic (for lack of a better word) about socialistic ideas.

I'm one of those rare individuals now days that's employed by an old blue chip company, where they do have a pension and like Geet said a 401K. But there are distinct differences between a pension and the 401K.

The 401K is a way to divert money you make today into an account where you will theoretically use that money in the future when you're retired and you're not earning money or earning little money and so the taxes you'll pay on the money you withdraw will be minimal. So the essence of it is deferred taxed income but also some form of retirement savings.

Some companies will "match" a percentage of what you put into the account, they'll also throw in some profit sharing dollars into that account so in most cases you wind up getting a 100% or greater match per dollar from the money you put in. The account is also managed by a financial services company where the money in it is in a managed stock portfolio so it has the potential to grow along with the stock market as a whole.

More than you ever wanted to know about 401ks.

...and you can choose yourself how the financial service company invests your $$, i.e., you choose the funds (aggressive growth or safe bets or in between) and % of your monthly contributions to go in to the various funds. That way you can tailor the 401(k) to your age-related needs. Just to confuse everybody: I have a 403(b) which is the 401(k) equivalent for educators.

[What's Burning?]

I have a 403(b) which is the 401(k) equivalent for educators.

They let you near children????

[darwin dali]

I have a 403(b) which is the 401(k) equivalent for educators.

They let you near children????

Yeah - most of the time I have to wear a Hannibal Lecter mask though

[LRW]

God this thread got boring all of a sudden!!

[andrew]

Say something interesting then! Some folks might find this 401k stuff informative.

[LRW]

Say something interesting then! Some folks might find this 401k stuff informative.

Somethimes when you talk all I hear is:

"blah blah blah blah blah blah......."

[andrew]

Don't read them then. Block my comments and save yourself the stress.

[LRW]

Don't read them then. Block my comments and save yourself the stress.

"blah blah blah blah blah blah......."

[andrew]

[Jabberwocky]

I have a 403(b) which is the 401(k) equivalent for educators.

They let you near children????

Yeah - most of the time I have to wear a Hannibal Lecter mask though

God this thread got boring all of a sudden!!

How did you work that out?

[LRW]

I have a 403(b) which is the 401(k) equivalent for educators.

They let you near children????

Yeah - most of the time I have to wear a Hannibal Lecter mask though

God this thread got boring all of a sudden!!

How did you work that out?

I have a secret formula that calculates the boringness of each thread.

[andrew]

I have a 403(b) which is the 401(k) equivalent for educators.

They let you near children????

Yeah - most of the time I have to wear a Hannibal Lecter mask though

God this thread got boring all of a sudden!!

How did you work that out?

Too busy going blah blah blah blah probably.