Employees Raiding 401Ks to Pay Bills

[mathjak107]

i have written susie many times correcting her logic on the double taxation thing, i even requested her to show me at what point in any year you paid more in taxes whether you took a 401k loan or not.....

never an answere.

 

[mathjak107]

its no different than taking 10,000 out from your 401k as loan. deciding you didnt need the money and putting it back in. there is noooooo extra tax paid. she forgets your income you earn is taxed whether you pay back a 401k loan or a bank loan with it or not. the 401k loan is like taking back the income you earned and never paid taxes on it so you still owe taxes which you pay only once on withdrawl.

 

[saujanya]

No double tax on repaying 401k loan

double tax would mean that I pay tax today (i.e when i make the monthly payment on 401K loan) & when I withdraw (say, at retirement).
someone already mentioned that you will pay taxes on your income whether you are repaying 401k loan or any other non-home loan.
Further, lets say, I make $100,000/yr & lets say flat tax rate 25%, I would pay $25,000 in taxes this yr. If, this year I have also taken a 401K loan, I am still paying only $25,000 in taxes this yr for $100,000 income.
So, I will only pay tax on my 401k money at withdrawal. That only once.
"you are paying back 401k loan with "after tax" money is misleading.

 

[mathjak107]

its only the interest you are taxed on 2x. i think because of the catagory of people who watch her she says that double taxation thing to try to discourage people from hitting their retirement money. non the less she is still wrong

 

[TargaDave]

You are kidding, right ?
The value of a car decreases considerably
with increase in age and mileage, etc...
while a house, traditionally, increases in
value. But everyone knows that, right ?

You are kidding, right? Land can increase in value, buildings and structures depreciate and break down just like cars. Maybe not as fast but much bigger $ involved. Ever rebuild a septic system, update a heating system, replace a full set of failing windows, or sell a house with a completely outdated look or internals? Sorry, didn't mean to take a swipe but, everyone knows that, right? Just ask LGFNB about an older structure on a prime lot.

 

[Razor]

I have a dumb question....why is it that the bride's family has to pay the whole thing? Other than tradition, it doesn't seem that smart financially.........

Sometimes traditions suck.
I believe the bride and groom should pay for their own wedding. It would be a good lesson about money and they might appreciate it more. I have seen some of the most lavish weddings paid for by modest income parents end up in divorce in just a few years. Just sickening. Not to mention that expensive gift I gave the couple. I want it back.

 

[mathjak107]

its not that way anymore, its split usually by all parties. my son just got married in sept and they wanted a big lavish afair. it approached 6 figures, i thought it was nuts but thats what they wanted. so we split it 3 ways

 

[Razor]

its not that way anymore, its split usually by all parties. my son just got married in sept and they wanted a big lavish afair. it approached 6 figures, i thought it was nuts but thats what they wanted. so we split it 3 ways

So it cost you 30 grand for one day? WOW.
I personally believe that parents shouldn't be made to feel they have to pay for any of it. It seemed to me that sometimes the bigger the wedding the shorter the marriage.

 

[Walt34]

So it cost you 30 grand for one day? WOW.
I personally believe that parents shouldn't be made to feel they have to pay for any of it. It seemed to me that sometimes the bigger the wedding the shorter the marriage.

I paid for both of mine. Neither bride's parents had the resources. But it wasn't anywhere near that much. DW's wedding dress came from J.C. Penny.

 

[Hamlet]

Yikes!

I got married in July last year for only about three thousand (60 people). We rented a room at a local park and had the ceremony in a little amphitheater outside. We had it catered picnic style by a local restaurant and brought the beer and wine ourselves.

It is very nice to have DW on the same page about things like this. She realizes that over the long term these expenses could mean the difference between having a cabin at the lake and not having a cabin at the lake. Or retiring several years earlier. Or having a much nicer house.

its not that way anymore, its split usually by all parties. my son just got married in sept and they wanted a big lavish afair. it approached 6 figures, i thought it was nuts but thats what they wanted. so we split it 3 ways

 

[Delawaredave5]

I have a dumb question....why is it that the bride's family has to pay the whole thing? Other than tradition, it doesn't seem that smart financially.........

........

What I don't understand is why does every wedding try to "one up" all other weddings prior with "luxury" crap.

Best weddings I've been to were at the fire hall with those wooden fold-up chairs and trays of rigatoni and keg beer.......

 

[Razor]

What I don't understand is why does every wedding try to "one up" all other weddings prior with "luxury" crap.

Best weddings I've been to were at the fire hall with those wooden fold-up chairs and trays of rigatoni and keg beer.......

I hear ya.

 

[Moemg]

I told my daughter I would give her $12,000 towards her wedding and buy her dress and veil . The rest she would just have to figure out . Well it was a great wedding and the bill came in at $14,000. My sister told her daughters she would pay for a wedding or graduate school before they were 30 . Well she lucked out Her daughter did not go to graduate school until she was 32 and is now getting married at 35 .

 

[Zipper]

The "Zippers" got married in '69 and paid the whole shot ourselves.

 

[Razor]

All us kids in the family paid for our own. My brother three times.

 

[Calgary_Girl]

I have a dumb question....why is it that the bride's family has to pay the whole thing? Other than tradition, it doesn't seem that smart financially.........

Although this is the tradition in our family (European) DH and I paid for our own wedding. My parents didn't have the money and I would never have expected them to take money out of their own retirement...that just sounds like a stupid thing to do. Luckily, DH and I were able to pay for our own wedding. But, even if we weren't able too, I'd imagine we would have taken out loans or eloped to keep the expenses down, before I'd jeopardize mom and dad's retirement.

 

[prgsdw]

Wife and I paid for our own wedding. THe topic of who was paying actually never came up ahead of time and we just went ahead and took care of everything. Worked out fine and we spent on things we wanted and could justify to ourselves. Worked out great.

 

[Ronstar]

Wife and I paid for own wedding. We eloped and I think the whole bill was under $200.