Monday, August 28, 2006
Don't Treat Your 401(k) Like A Piggy Bank
I'm always fascinated by the various rationalizations people come up with to justify almost anything they want. A $70,000 BMW SUV? That's not just ego gratification. It's a necessity for navigating those treacherously steep suburban driveways.
And spending $100,000 to transform a normal bathroom into a sybaritic palace with marble walls and a pool-sized hot tub isn't an extravagance. It's an investment in real estate!
Besides, if you can pay for all this by dipping into your 401(k), well, what's the harm? You're paying interest to yourself, so the more you borrow, the more you're feeding your 401(k), right?
Wrong. The idea of a 401(k) as some sort of easy-to-tap piggy bank is dangerous for several reasons.
Don't Treat Your 401(k) Like A Piggy Bank
Source: CNN/Money.com
And spending $100,000 to transform a normal bathroom into a sybaritic palace with marble walls and a pool-sized hot tub isn't an extravagance. It's an investment in real estate!
Besides, if you can pay for all this by dipping into your 401(k), well, what's the harm? You're paying interest to yourself, so the more you borrow, the more you're feeding your 401(k), right?
Wrong. The idea of a 401(k) as some sort of easy-to-tap piggy bank is dangerous for several reasons.
Don't Treat Your 401(k) Like A Piggy Bank
Source: CNN/Money.com
Permalink posted by armandn @ 11:02 AM 
 |
 |  |
  |
