Our fiduciary financial advisor, Eric Powell, will cover how to use a 401k correctly! Today we'll cover 401k asset allocation, should you use a Roth 401k, and more! We're covering all things 401k-related today!
0:00 401k Investing: Historic returns
2:19 401k Case Study
4:06 Roth 401k Concerns
6:38 Questions for an advisor? Drop them below!
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Thanks for watching! Have a topic or scenario you want to see? Drop your thoughts below! 👇
Heck ya Eric! Great content
Thanks Joseph!!
I spy the puppy! 🐾
I really like your point about going to Roth if you aren’t going to use your pre-tax saved money wisely. That’s a great way to think about it. We struggle with the notion that since we are in our higher earning years we shouldn’t go Roth, but because of dual pensions and other sources of income we just may be in the same tax bracket later in retirement. We have decided to switch over to Roth now and have a pot for pre-tax and roth to pull from later. Thank you for the pension videos! Even in lower pensions it makes a big difference in income later with all the buckets to pull from.
Thanks Eric always good info
2 of the advices are arguable. Investing very aggressively has a potential of higher return with quite a lot more risks. There is no guarantee. There are been long period (something like 2000 to around 2018 as I recall) where a 60/40 portfolio had the same return as a 100% stock. And the 100% portfolio had much bigger drops, which would most likely lead a 48 years old not comfortable with high risk to sell at the wrong time.
The second advice about the Roth looks quite weak to me. Mathematically, if the same amount is placed in a 401K or Roth 401K account and the tax bracket is the same before and after retirement, then the actual amount (after tax) between pre and post tax is exactly the same. If the tax is lower after retirement, assuming every other parameter stay the same , then the 401K is better. Most people cannot and would not invest more based on the Dollard amount but can afford (or want ) a percentage. The psychology of saving taxes now is for most stronger as saving taxes 20 years down the road.
Almost everyone is in a lower tax bracket immediately in retirement or after their go go years are over. Most will be 0% at some point. Every year the income brackets are also increased.
Can I contribute more than $8,000 (I am over 50) to a work sponsored Roth 401K?
Not counting the employer contributions, you can personally contribute 23k to a 401k or Roth 401k (can do an additional $7500 when over 50)
With an IRA or Roth IRA, the limit is $7k, or $8k when over 50
Dat Eric mic!!!
I recently rebalanced and went to 25% cash and bonds (yielding 4-5%), 35% in international funds, 20% large cap US and 20% small and mid-cap US (but NOT the Russell 2000, broad but managed funds with no zombies).
My goal was to avoid overexposure to the Magnificent Seven and the US market while still riding this bull for however much longer it lasts.
Anyone have any thoughts, positive or negative, on this approach?
It’s recommended to save at least 20% of your income in a 401k. You can use online calculators to estimate how much you should save based on your age and income. Saving at least 20% of your income in a 401(k) can help ensure that you have enough money to retire comfortably. By saving this much, you can take advantage of compound interest and potentially grow your retirement savings over time.
Effective personal finance management is more important than the amount of money saved, regardless of whether income is earned through job or investment. Individuals can seek counsel from a certified financial advisor to optimize financial outcomes, who can provide specialized advice and methods to decrease expenses and maximize income.
This is precisely why I like having a portfolio coach guide my day-to-day market decisions: with their extensive knowledge of going long and short at the same time, using risk for its asymmetrical upside and laying it off as a hedge against the inevitable downward turns, their skillset makes it nearly impossible for them to underperform. I’ve been utilizing a portfolio coach for more than two years, and I’ve made over $800,000.
@@joshbarney114 I appreciate the implementation of ideas and strategies that result to unmeasurable progress. Being heavily liquid, I’d rather not reinvent the wheel, thus the search for a reputable advisor, mind sharing info of this person guiding you please?
Finding financial advisors like Marisa Breton Dollard who can assist you on things like investing, insurance, making sure retirement is well funded, going over tax benefits, ways to have a volatility buffer for investment risk would be a very creative option. There will be difficult times ahead, and prudent personal money management will be essential to navigating them.
Excellent share, just inputted Marisa Breton Dollard on the internet, spotted her consulting page ranked top and was able to schedule a call session. I’ve seen commentaries about advisors but not one looks this phenomenal.