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Author: BookmFool Big red star, 1000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 76418  
Subject: Re: 401k or not? Date: 7/2/2000 7:18 PM
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My company recently started a non-matching 401k plan. My husband and I chose not to participate for the following reasons:
1. Though we really like the company we will probably only be there for another 1 1/2years.


Koyasan, the first issue may not be a problem, since you can transfer money in one 401k to one at another place of employment. In today's workplace where people transfer from job to job, they can follow you around.

2. We are currently putting away $2,000/year each for Roth IRA's and $200/month into a Vanguard 500 Index Fund account.

Very Foolish.

3. We didn't really see that the tax advantages would
have made that great of an impact.


Really? Remember, each individual can defer up to $10,500 of their income into a 401k. That could theoretically be $21,000 of your income that won't be figured into your tax equation. I'm sure you'd notice some type of impact from that.

Someone suggested that the 401k is the better way to do it regardless of the length of time.

That would depend on the quality of the 401k, and they are all different (the funds offerred, expenses, maintenance fees, the company running it, etc). You're likely to get a few different sugestions, so the Foolish thing to do would be to make the decision yourself. There are areas here that can help you do that.

Using the "Quick Find" drop-down menu at the top right hand part of the page, the Retirement section has alot of useful info regarding this matter. Also, under the Fools School section, click on Mutual Funds for more on them. You've got a great investment strategy started already (without knowing what you're investing in). The 401k could compliment what you've already got.

HTH

BmF
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