401K Contributions: Yes/No?

[Anh Nguyen]

Hi BiggerPockets Community,

I have a question that I'm trying to debrief in terms of optimal investing strategy, and hope I can get some advice from the peers.

I currently have a stock portfolio that I myself direct and it's been generating returns very well - consistent 15%-20%. I have this portfolio during my college years. And now that I just graduated and started to work for a tech company in the Bay Area, I was given the option of contributing to my 401K. They will match 100% for the first 2% and 50% for the next 1% of my paychecks.

When I calculated the pros/cons, I figured that with the doubling money as a pro, compared to the cons of not being to direct the investment choices and returns are typically average at 7%, I decided to not contribute. Another reason that got me escape from this is that I avoid illiquidity aspect that the 401K contributions cause. I have put a good amount of money into my personal portfolio, and I'm trying to save cash on the side in case I need to make a quick jump.

However, when I came cross the community's posts, I realized that I can borrow the 401K contributions to purchase real estate, which I'm trying to pursue (for either investing or buying my first house).

So as of now I'm in the middle of the path trying to figure out if it's worth putting more money into 401K. The deadline to apply is coming due soon, so I'd appreciate any help! Thank you!