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Like I implied in my original post. If you can figure out how to get $49k/year into your 401k, the rest of the strategies involved in building wealth become a walk in the park.
The biggest thing is to not to have debt & risk. Don't drive new cars & use CC's. Don't have a mortgage over 25% of your monthly income. Invest in good growth mutual funds.
In my opinion, investing in gold and real estate brings back a lot of money, but as you have said suppose anyone doesn't has got that much of amount to spend , then he can simply try his luck in acting...
Don't have a mortgage over 25% of your monthly income. Invest in good growth mutual funds.
Mortgage is debt and growth mutual funds are often the riskiest.
However, these (mortgage and growth funds) are what a young person should be doing. It's OK to borrow and it is OK to invest in risky funds - when you're 22. Rates are so low and growth funds are fairly tax efficient (low interest and dividends).
Mortgage is debt and growth mutual funds are often the riskiest.
However, these (mortgage and growth funds) are what a young person should be doing. It's OK to borrow and it is OK to invest in risky funds - when you're 22. Rates are so low and growth funds are fairly tax efficient (low interest and dividends).
My comment on debt was referring to car loans, credit cards, student loans, personal loans, etc...
Like I implied in my original post. If you can figure out how to get $49k/year into your 401k, the rest of the strategies involved in building wealth become a walk in the park.
Hi NJBest, can you help me understand how it's possible to get $49K into one's 401K?
If you're young risk is your friend. Read the Morningstar investment books on investing in mutual funds and don't be worrried so much about keeping your money "safe". In the long run the market will reward risk. And you're in it for the long run...
My husband and I both worked, but only lived off of one salary when we were starting out. We used the other salary to quickly pay off student loans, and after that for investments. We had second jobs to save for the down payment on a house. We took advantage of free tuition for grad school from our employers. We bought a fixer upper first house in a great neighborhood, did the work ourselves, and turned a huge profit when sold it because of a job relocation. We've repeated that process several times, each time reinvesting the money in a down payment, so now our current home is nearly paid for. When we started a family, I decided to stay home with kids and work part time from home--he was free to travel more extensively for work and build his career. We still live well below our means, we're still saving, but we have zero debt except for what's left on the house, and have great savings for retirement and college for the kids.
Selling a house now would be tough, but this is a great time to buy at a bargain price--if you can build even more equity by doing improvements yourself, then the payoff increases even more long term. I'm not going to give you investment advice, but there are real opportunities out there with companies who'll be able to ride the recession out and come out strong. You just have to do your research and be smart about it.
Hi NJBest, can you help me understand how it's possible to get $49K into one's 401K?
Well, the only real way is to have income high enough in a manner that you can actually put that kind of money away. I mention $49K because that is the maximum amount that anyone can put into their 401k. The exception is those less beneficial employer sponsored 401K's that have a ridiculously low limit of 16.5K or so.
Look up solo 401K and get your ducks aligned to qualify for one.
Last edited by NJBest; 09-27-2010 at 12:47 PM..
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