Does your business card read "fatty fat fat"? If so, I'm gonna have a hard time taking you seriously. LOL! ------------------ <this space for rent>
Clutch, I'm not smarter than anybody else on this board and like I told Will, I sure as heck can't predict stock performance to any great extent. But, you could've put your money into just about any tech fund last year and gotten great gains. You still can, although Alan Greenspan (that bastid) and his rate hikes are hitting hard on returns lately. BTW, regarding the stocks I listed in my original post : of course I haven't owned them for their entire run, but I've gotten a nice little return off of all of them (especially Xcelera). Xcelera made one of my friends a half-a-millionaire recently. I hate him. But if'n I give you a good stock, you will have to change the name of the website to clutchcityanddrofdunk.net. Fair trade? ------------------ <this space for rent> [This message has been edited by Dr of Dunk (edited March 06, 2000).]
Hey guys, I am an investment advisor. If anyone is looking to invest, or you simply have a question, feel free to give me a call. 713-651-3333
Dr of Dunk: No, my card does not read "fatty fat fat" (although maybe I should have some special ones made for my buds in here). That number is my direct line. But my name is Jim if that makes you more comfortable.
PhiSlammaJama: My response is not to touch your 401K. While it may seem logical right now, your 401K is a vehicle for your retirement, and it should be held sacredly in that regard. You can use your 401K as collateral to a bank and try to get a better interest rate, but that's the only way I would use it. I'll give you the best statistic to why you should'nt touch your retirement package. Every five years earlier you save will essentially double your retirement's value. ie:if you start investing at age thirty, we will assume that is 100% of your retirement needs. At age 40--you would only have 25% of what it would have been if you left it alone. At age 20, you would have 400% of what you would have at age thirty. These are long term averages, but they are realistic. Point is if you have invested in your 401k for 5 years, and you used it to pay off a loan, you can rely on getting only half of what you would normally get at retirement. Max out your 401k as if it were a bill, and never touch it. It will be well worth your while. Hope that helped. [This message has been edited by fatty fat fat (edited March 07, 2000).]
Another reason not to touch the 401(k)-you will owe taxes PLUS a 10% early distribution penalty. So, say you need $30,000. You would really need $50,000 (say 30% tax plus 10% penalty) out of your 401(k) to cover the $30,000. It's just not worth it!
Plus interst paid on studentloans is tax deuctible for the 1st five years. Talk is this will be extended to the life of the loan, rather than just the five years. Keep your 401K plan. I think someone said the Dow Jones has averaged historically 12-13%/year while the interest on your student loan may be 8%. The 8% is further reduced by your tax bracket 15/28/31%, etc.
Fatty, or anyone: I've got two degrees and some student loans to pay off. About $30,000. If my 401K, minus the taxes, is enough to pay off my student loans should I pay off my student loans or hold onto the 401K and slowly pay off my loans. My interest rate on student loans is about 8%. I guess my thinking here, without any financial analysis, would be that I could quickly build up my 401 K even if I wiped it clean to make the payment. What are your initial thoughts?