I’m a new grad on F1 OPT and wondering if investing in a 401k is worth it given I don’t want to retire in the US. Plan is to move back to India(home country) in the next 5ish years. I would be inclined towards withdrawing the money when I leave, only reason I’m considering it as an option is because of the match. LinkedIn provides a 50% match upto the IRS limit(23k). Is it worth the hassle to still invest, take the penalty and tax hit when I withdraw it. I can’t find much advice on this specific topic. If anyone has done the same please lmk. PS - I don’t think I’ll be psychologically okay keeping this money parked till retirement age(>35 years from now) TC - 250
You will be far ahead despite the early withdrawal penalty
50% contribution and only 10% penalty. No brainer
Yeah not sure why is this even a question
Thought process was around that 10% penalty plus heavy taxes pretty might make the gains negligible.
Even if you don't plan to retire in the US, still invest in 401K. I was in a similar boat when I was 25-26 and started 10 years late. I probably made the biggest mistake. I could have retired at 40 along with other investments.
My plan is that if I leave US, I’ll still maintain the 401k account using some relative/friend’s home address. That way I would be able to withdraw around ~$30k annually tax-free (standard deduction for married jointly). Even if you withdraw more per year after leaving US, the tax rate will be less than 10%, compared to more than 42% right now.
Giving your friend’s address is fraud. You can still hold 401k as long as your home country allows it. Unless your home country doesn’t have tax. You will be paying taxes based on your home country. So it won’t be 10%. The worst advices anyone can give.
do the math, this is free money for the match
Y do u wanna turn down free money?
Is there a reason not to invest given 50% match?
Invest in Roth 401k so that penalty will be minimized in future
Another underrated pro of the 401k is it’s really hard to pierce in any legal proceedings coz it’s your retirement funds.
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