Mortgage Payment on 200K salary?

[Anonymous]

... also, please use the standard chronological message format. Your unnecessary need to reconstruct the standard structure just makes it harder for subsequent messages to maintain the normal messaging construct.

[Anonymous]

How fucking stupid are you? You do know that this "tax shield" is actually a tax deferment, right?

There are 401k plans out there that are simply not worth the expected benefit from the different tax treatment. Fortunately this is the exception to the rule, but they do exist. I know a number of people that have opted out of 401ks for very good reasons.

I will admit that for many people maxing out the 401k makes sense, but a blanket claim that everyone should be doing so is Size Or man type bullshit.


Signed
Finance PhD

Anonymous wrote:

Anonymous wrote:No, I fully understand the tax implications. If fees are high enough and performance is poor enough on tax advantaged accounts, taking the tax hit now and putting the money in a taxable account can y produce superior yield. This is a well known issue. Your grasp of these things is clearly limited (or you run a 401k), and you should not be giving advice on financial matters.

Anonymous wrote:

Anonymous wrote:Blanket statements like this make no sense. Some 401ks are horrible. I was at a place for a few years with very little match and terrible fees. I didn't put a dime in that thing. Good plan at the new job and I max out.





Well, you are ignoring the tax benefits ...

Haha. You are making quite a few assumptions there...high fees, poor performance, etc. The fees and performance drag have to be pretty darn high to offset a ~15%+ tax shield. It would have to be an absolutely atrocious plan - as in world class bad - to not have some level of index fund / general market exposure to make it a 99.9999% chance of outperforming any taxable option when the tax shield is included. I am quite confident my understanding of these issues would run absolute circles around your clearly elementary understanding.

[Anonymous]

"Size or man" should be Suze Orman

[Anonymous]

Well aren't you a piece of work. I highly doubt you have a PhD in anything from your petulant and irrationally confident tone, but regardless let's look at the data ... At $200k income, the blended federal tax rate is ~22% and in the 28% marginal bracket. Future withdrawals will almost certainly be taken at a much lower tax rate, e.g., 15% or even 10%. Even ignoring the compound power of these savings when reinvested for decades, it would take the world's worst 401k options and fees to offset this tax SAVINGS (deferred, but also lower, which = savings). Frankly I don't think one could construct such a plan if the goal was to offset this 7%+ tax benefit.

I will accept your point that very few axioms in investing can be taken as blanket fact - individual conditions always matter- but based on the facts presented in this case, your argument is terribly misplaced for this specific situation. Also, you're clearly an A-hole and your anger problems make me think that even if you are a PhD, you are not a very successful one and have a major inferiority complex.

Signed - a successful finance professional that practices. And as we all know, those who can, do, those who can't become PhD academics.

[Anonymous]

We have a HHI of $220K-$250K, depending on bonuses. Preschool for one, daycare for one comes out to childcare spending of ~$2K/month. No other debt and have an 18 month emergency fund. We're pretty comfortable with a monthly PITI of $3,700.

[Anonymous]

You do know that not all PhDs are academics, right? Let me guess, you are an MBA.

Anonymous wrote:Well aren't you a piece of work. I highly doubt you have a PhD in anything from your petulant and irrationally confident tone, but regardless let's look at the data ... At $200k income, the blended federal tax rate is ~22% and in the 28% marginal bracket. Future withdrawals will almost certainly be taken at a much lower tax rate, e.g., 15% or even 10%. Even ignoring the compound power of these savings when reinvested for decades, it would take the world's worst 401k options and fees to offset this tax SAVINGS (deferred, but also lower, which = savings). Frankly I don't think one could construct such a plan if the goal was to offset this 7%+ tax benefit.

I will accept your point that very few axioms in investing can be taken as blanket fact - individual conditions always matter- but based on the facts presented in this case, your argument is terribly misplaced for this specific situation. Also, you're clearly an A-hole and your anger problems make me think that even if you are a PhD, you are not a very successful one and have a major inferiority complex.

Signed - a successful finance professional that practices. And as we all know, those who can, do, those who can't become PhD academics.