401K and tax refund
Hi Terry,
I received $6,500 for my refund. I recently bought a condo in Chicago that needs renovations.
Would you suggest I paid down my principal with the refund or would it be wise to add to my retirement account.
I am 30 years old, single and have over $115,000 in my 401K currently for reference.
Thank you!
Terry Says
Good for you. Keep contributing to your 40lk, since you’re off to a good start. But 40lk contributions can only come from your salary.
You could open an IRA, but I’d suggest you use this money to do the renovations, with a careful budget. It will be repaid when you eventually sell. (Remember, you get $250,000 of gains tax-free when you sell in the future.)
And you might keep a bit of that in a money market fund for savings, in case of emergency.
