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Updated almost 8 years ago on . Most recent reply

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Tom Hudson
  • Milwaukee, WI
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Invest 100% of income?

Tom Hudson
  • Milwaukee, WI
Posted

I am almost 29 years old and have $80,000 in cash and $50,000 in investments (between a $401K, Brokerage account, and a couple of IRAs.)

I make just under $50K a year. My takehome pay after taxes, 401K contributions, medical expenses, etc. is $31K.

Since I have so much money in the bank and am more than four years away from living paycheck to paycheck (I only spend about $17K/year), would it be a good idea to just start to invest 100% of my income and live off of what I currently have in savings? I am single with no kids, and my only debt is an $8k car payment. I would like to start to invest more aggressively, and all that cash in the bank is losing buying power.

Any feedback would be appreciated.

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Anthony Dooley
  • Investor
  • Columbus, GA
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Anthony Dooley
  • Investor
  • Columbus, GA
Replied

The problem with the 401K is that you have absolutely no control over it. The stock market goes up or down based on tweets from Donald Trump. Also, you don't have access to it until 59 1/2. So you are giving up control and access to your money for 30 years. It's a savings account that you can't use without IRS interaction.

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