Find me a bank that lets people pull from their savings constantly,
"Emergency" now means "constantly." Okay.
Again, show me where in the survey it said checking only
Me: "Why do you think withdrawing money from a brokerage account is a massive loss?"
You: "But what was the question in this survey?!"
Did you quote the wrong thing or are just that obvious at dodging questions?
Edit: You want to discuss what the question was in this particular case, you can go track down the survey the guy in video was discussing (unsourced). Until someone shows me otherwise, I'm going to assume "researchers" and "journalists" are being dishonest as we've all come to expect.
You made a non argument because the fed changed a rule but bank practices stay the same.
Me: "Why do you think withdrawing money from a brokerage account is a massive loss?"
You: "But what was the question in this survey?!"
Did you quote the wrong thing or are just that obvious at dodging questions?
I’m sorry, are we pretending 401ks don’t have penalties for withdrawals now? What happens to the match when you withdraw early? You keep making non arguments that have zero to do with the survey.
Edit: You want to discuss what the question was in this particular case, you can go track down whatever the guy in video was discussing (unsourced). Until someone shows me otherwise, I'm going to assume "researchers" are being dishonest.
Sooo you didn’t watch the video… he was reading the questions verbatim.
Just some simple things to point out since I see this back and forth. I presume we are talking about the standard US banking system here. There are several common account types, generally anyone can get these accounts in the US. I'm sure there's exceptions for history of fraud, crime, or whatnot but the average person can get all of these. I had most of them when I was 18 making peanuts.
Checking Account -- I think we all understand this one
Savings Account -- usually no penalties and readily available with no minimum balance and 4% interest. Can often get ATM withdrawals of cash instantly, but in any case should be accessible in 1 business day. Almost all of these accounts allow 6 withdraws a month of any amount with no fee or penalty.
"Regular" Brokerage -- It's a trading account to buy stocks, bonds, funds, and what not. It is not a 401k. There's no penalty or limit of any sort generally to transfer things in and out. At least not that would affect someone in the 60k-100k income range. You would have to liquidate any securities you have at present market value that may or may not have changed value.
Retirement accounts (401k, IRA, Military thrift savings, etc.) -- these do carry a penalty of 10% for early withdrawal under 60, often you cannot withdraw if you still work at a company, etc. Not the best place to keep emergency money, it's supposed to be for retirement savings.
CD Accounts -- These guarantee an interest rate in exchange for a commitment to keep the money in them for a certain term. Penalty varies by bank, typical is a fee equal to 6 months of interest, so for $1000 at 5% interest, it would be $25 fee to liquidate this.
As to whatever else is being bickered about, I don't care. I don't think a ton of this is even really in this video. I just wanted to spell out the most common accounts, because I keep reading things about accounts that aren't really accurate.
And if we want to get really out in the weeds, there are ways to get money out of a retirement plan without penalty. Like taking a loan of up to 50% of the balance of your 401k (up to $50k), which you must pay back with interest, to yourself (including the interest), within 5 years. If you don't pay it back then it counts as a distribution and you start having to worry about taxes and penalties (if you're under 59.5).
Although it's probably fair to say that if you know a 401k self-loan is an option, you probably have $500 that's easier to get to.
are we pretending 401ks don’t have penalties for withdrawals now
No one is pretending anything. You're just clearly unfamiliar with these things. A 401k is a type of brokerage account, but it is also a retirement account. Regular non-retirement brokerage accounts have no penalty of any kind. You would just sell some sort of security (yes, during market hours probably) and the funds would be available immediately. Yes, it technically takes a business day to settle the trade, but that is usually obscured by the brokerage who just deposits the funds immediately. A 401k is certainly not the only kind of brokerage account, nor is it what anyone is referring to when it's called a "brokerage account" instead of "401k" explicitly.
Sooo you didn’t watch the video… he was reading the questions verbatim.
"46% said they don't have $500 saved for an emergency." He's obviously reading the results of a study verbatim. That is not the question. And, like the other poster said, I've seen this trick before. The question can be something like "do you have at least $500 in savings dedicated to emergencies" and the respondent will go "it's not earmarked for emergencies, so no."
No one is pretending anything. You're just clearly unfamiliar with these things. A 401k is a type of brokerage account, but it is also a retirement account. Regular non-retirement brokerage accounts have no penalty of any kind. You would just sell some sort of security (yes, during market hours probably) and the funds would be available immediately. Yes, it technically takes a business day to settle the trade, but that is usually obscured by the brokerage who just deposits the funds immediately. A 401k is certainly not the only kind of brokerage account, nor is it what anyone is referring to when it's called a "brokerage account" instead of "401k" explicitly.
This is a hilariously lazy attempt. What percentage of people making 60-100k have a second brokerage account aside from a 401k? I’m betting it’s less than 10%, which falls in the 46%.
"46% said they don't have $500 saved for an emergency." He's obviously reading the results of a study verbatim. That is not the question. And, like the other poster said, I've seen this trick before. The question can be something like "do you have at least $500 in savings dedicated to emergencies" and the respondent will go "it's not earmarked for emergencies, so no."
Again, making assumptions, can you show me the study you said is a trick?
If you can't be bothered to look up the study he's citing and I can't be bothered to look up the study he's citing, I think we're at an impasse. I default towards assuming studies are fabricated bullshit. You default towards taking them at face value. It doesn't really make that much of a difference. We both agree that the financial state of the average person is fucked anyway, even if we disagree on the amount of trust that can be placed in "the experts."
"Emergency" now means "constantly." Okay.
Me: "Why do you think withdrawing money from a brokerage account is a massive loss?"
You: "But what was the question in this survey?!"
Did you quote the wrong thing or are just that obvious at dodging questions?
Edit: You want to discuss what the question was in this particular case, you can go track down the survey the guy in video was discussing (unsourced). Until someone shows me otherwise, I'm going to assume "researchers" and "journalists" are being dishonest as we've all come to expect.
You made a non argument because the fed changed a rule but bank practices stay the same.
I’m sorry, are we pretending 401ks don’t have penalties for withdrawals now? What happens to the match when you withdraw early? You keep making non arguments that have zero to do with the survey.
Sooo you didn’t watch the video… he was reading the questions verbatim.
Just some simple things to point out since I see this back and forth. I presume we are talking about the standard US banking system here. There are several common account types, generally anyone can get these accounts in the US. I'm sure there's exceptions for history of fraud, crime, or whatnot but the average person can get all of these. I had most of them when I was 18 making peanuts.
Checking Account -- I think we all understand this one
Savings Account -- usually no penalties and readily available with no minimum balance and 4% interest. Can often get ATM withdrawals of cash instantly, but in any case should be accessible in 1 business day. Almost all of these accounts allow 6 withdraws a month of any amount with no fee or penalty.
"Regular" Brokerage -- It's a trading account to buy stocks, bonds, funds, and what not. It is not a 401k. There's no penalty or limit of any sort generally to transfer things in and out. At least not that would affect someone in the 60k-100k income range. You would have to liquidate any securities you have at present market value that may or may not have changed value.
Retirement accounts (401k, IRA, Military thrift savings, etc.) -- these do carry a penalty of 10% for early withdrawal under 60, often you cannot withdraw if you still work at a company, etc. Not the best place to keep emergency money, it's supposed to be for retirement savings.
CD Accounts -- These guarantee an interest rate in exchange for a commitment to keep the money in them for a certain term. Penalty varies by bank, typical is a fee equal to 6 months of interest, so for $1000 at 5% interest, it would be $25 fee to liquidate this.
As to whatever else is being bickered about, I don't care. I don't think a ton of this is even really in this video. I just wanted to spell out the most common accounts, because I keep reading things about accounts that aren't really accurate.
And if we want to get really out in the weeds, there are ways to get money out of a retirement plan without penalty. Like taking a loan of up to 50% of the balance of your 401k (up to $50k), which you must pay back with interest, to yourself (including the interest), within 5 years. If you don't pay it back then it counts as a distribution and you start having to worry about taxes and penalties (if you're under 59.5).
Although it's probably fair to say that if you know a 401k self-loan is an option, you probably have $500 that's easier to get to.
No one is pretending anything. You're just clearly unfamiliar with these things. A 401k is a type of brokerage account, but it is also a retirement account. Regular non-retirement brokerage accounts have no penalty of any kind. You would just sell some sort of security (yes, during market hours probably) and the funds would be available immediately. Yes, it technically takes a business day to settle the trade, but that is usually obscured by the brokerage who just deposits the funds immediately. A 401k is certainly not the only kind of brokerage account, nor is it what anyone is referring to when it's called a "brokerage account" instead of "401k" explicitly.
"46% said they don't have $500 saved for an emergency." He's obviously reading the results of a study verbatim. That is not the question. And, like the other poster said, I've seen this trick before. The question can be something like "do you have at least $500 in savings dedicated to emergencies" and the respondent will go "it's not earmarked for emergencies, so no."
This is a hilariously lazy attempt. What percentage of people making 60-100k have a second brokerage account aside from a 401k? I’m betting it’s less than 10%, which falls in the 46%.
Again, making assumptions, can you show me the study you said is a trick?
If you can't be bothered to look up the study he's citing and I can't be bothered to look up the study he's citing, I think we're at an impasse. I default towards assuming studies are fabricated bullshit. You default towards taking them at face value. It doesn't really make that much of a difference. We both agree that the financial state of the average person is fucked anyway, even if we disagree on the amount of trust that can be placed in "the experts."