246: Finance Friday: I Want to Cash Out My 401k Early, Should I?

246: Finance Friday: I Want to Cash Out My 401k Early, Should I?

“Should I cash out my 401k?” That’s a question you never want to ask in an online financial independence forum. It’s been a well-known rule to never cash out retirement accounts due to withdrawal penalties, tax implications, and the possibility of throwing away your retirement plans. But, what if you had a substantially larger amount in real estate and other assets, what would you think then? Kate is in this exact predicament and has done a phenomenal job at growing her wealth over the past decade. Kate and her husband have acquired $1.8 million in rental properties, bringing in gross rents of over $10,000 per month! She’s currently sitting on half a million dollars in rental property debt and is wondering whether cashing out her 401k to pay off the debt would make sense. Because Kate is in such a high cash flow position, she may be asking a question that’s not so obvious. Mindy and Scott spend time walking through calculations that allow Kate to visualize what her life would look like with paid-off rentals as opposed to a fully-funded 401k account. In This Episode We Cover Why a mentor can help spur you onto to make better, more aggressive investing decisions Moving to a different part of the country to take advantage of higher salaries How to calculate whether or not you should withdraw your 401k funds Switching your job to a more flexible schedule without giving up your salary Travel hacking and using credit card points to pay for your vacations The benefit of using financing to buy your primary residence or rental properties And So Much More! Learn more about your ad choices. Visit megaphone.fm/adchoices

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