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Updated over 1 year ago,

User Stats

15
Posts
5
Votes
Spencer R.
5
Votes |
15
Posts

Traditional 401k, Roth IRA, or neither?

Spencer R.
Posted

Hi everyone,

Just as a quick backdrop: I am a 23 year old working a full time office job and contributing 8% (4% traditional, 4% Roth) to my 401k, and getting 4% matched by my company.

What I am wondering is if I should be contributing to my 401k when I am trying to build up as much capital as I possibly can to be able to buy my first rental property ASAP.  I appreciate the tax advantages of 401k's, but I feel as though it doesn't make sense for my goals.  I want to get into properties as soon as possible (1st property in next 1-2 years), and switch from my office job to rental properties in my mid 30s.  

If all goes as planned based on the power of compounding with rental properties, the 401k and Roth IRA that I'm building up now, wouldn't be of much value to me by the time I'm 65 because my rental properties should be cash flowing enough for me. So all that my 8% of contributions are doing right now are delaying the capital I need to get going with purchasing my first rental properties.

So I was wondering.. what do you all recommend.. should I just stick with a traditional IRA, should I do a Roth IRA because I can withdraw contributions at no penalty to put into rental properties at some point down the road, or should I not contribute to any kind of IRA?

Thank you everyone in advance for the insight!

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