Financial Fiction Friday #13

What on Earth?!

First of all, let's be clear: 401(k)s and IRAs are two of the most powerful saving vehicles available. Full stop. This is a fact.  

If you are worried that taxes will be higher in retirement: Choose a Roth 401(k) or Roth IRA. 

If you are more worried about reducing your taxes today: Choose a Traditional 401(k) or Traditional IRA.  

Second, who exactly is "the house" in this scenario? Is it the market or the government?  Are you arguing against investing altogether or just against tax deferral?  Either way, no strategy is risk-free.  Avoiding investing due to potential losses comes with its own drawbacks, the largest of which is inflation.  Avoiding tax deferral because you fear future tax rates does nothing to combat your current or future tax burdens.   

Please don't drink and post, kids.