Best use of 401(k) money

The best use of your 401(k), tracking ID: UA-121606870-1

By Paul F. Murray, Wealthy Affiliate member1 Us Bank Note


So you’ve worked for 40-45 years and your 401(k) portfolio has over a million dollars in it (assuming you haven’t been working at a fast food place all these years). I’ve gotten the impression from watching some of those commercials on television that you are supposed to take an educated guess as to how many more years you will live after you retire and, therefore, you are supposed to guess how much of your 401(k) money to spend every year so that you still have some of that nest egg left when you die. Or will you be among the retirees bankrupting?

Now I ask you: who, other than God, knows how long you are going to live? You can make a guess based upon heredity and lifestyle habits (e.g. do you smoke? eat and drink too much? etc.), but the reality is that none of us knows our body’s expiration date. If you are a Baby Boomer, born 1946-1959, your life expectancy at your birth was in the sixties somewhere. Life expectancy for your parents and grandparents when they were born would have been much lower. For someone born around 1900, making it to age 50 was considered an accomplishment. Age 50 was considered the start of “old age” back then. A lucky few might make it to the Biblical 70-80 provided they could escape the army of diseases such as tuberculosis, pneumonia, bronchitis, whooping cough, and so on that took many lives in childhood or young adulthood.

Life expectancy in the 21st century is expected to hit 90 years. Say you calculate your 401(k) to last you until you hit age 85 (a reasonable assumption). But when you hit age 85 and all of your 401(k) money is gone, can you live on social security alone?

A better way…box, cheerful, color

What some people do, and I think this is the best way of doing it, is leave that million dollars in the bank and let it sit there collecting interest. Live off the interest plus social security and/or small pension. A certificate of deposit with a locked in interest rate of, say, 3%, could land you $30,000 a year, which, combined with social security or a small pension may enable you to live okay, especially if your mortgage is paid off. You won’t live like a prince or princess, but then you won’t have to hope that you die in your late 60s or early 70s, either.

The above option may also be more practical if you have a source of income after you retire. I’m not talking about working part-time at a fast food place or at a convenience store. I’m talking about an income source that enables a retiree to work at their own pace, on their own time, and not be tied down to a schedule and a boss. Be careful, though. There are plenty of scammers out there who promise retirees the moon, e.g. “Buy our video and make your first $10,000 this week!” “Register within the next 10 minutes and get 50% off–our guaranteed system can’t miss and you’ll be taking vacations in the Bahamas or Monte Carlo a month from now!!” And so on. Yeah, right, sure you will.

Some of these advertisements for work-at-home schemes are outright frauds to take your money and run (see my review of Millionaire Mailers, for example), but others are operated by people who genuinely mean well but whose moneymaking schemes and methods simply do not work as well as they claim. You may want to read the fine print: “Testimonials are for example only. You may not make as much as the people in the video testimonials” or similar language. So beware–try to avoid spending a year or two, or three, wasting money on scammers or self-deluded money gurus. I have discovered that the best platforms for making money are the ones which make no promises of overnight big bucks, because you have to go through extensive training first.

Sorry, but that’s reality, not fantasy. If I were wrong about that, every one of us would be a multi-millionaire from platforms that promise heavy cash flow just from a few clicks on your computer. I am a member of Wealthy Affiliate, a legitimate non-scam moneymaking affiliate marketing program. You can check out further information from my website,, because it will give you a good idea of what a serious, genuine online money-making operation will look like as you research the different platforms. It might even be a good idea to start researching these different platforms a year or two before you plan to retire, so that when you do hit retirement, you will be financially ready to go.

I invite any comments below. I would be interested in learning to what extent others concur or not with my suggestions.Scenic View of Beach



  1. Furkan

    I also don’t trust these video reviews since one of my friends who is an actor also played for one. And they paid around 50 dollars. Anyway you mentioned about wealthy affiliate and I really wonder how long does it take to reach full time income? What is your experience with it?

    • admin

      Unfortunately, some of these “testimonials” are nothing but paid actors and actresses yamming it up for the camera and what they get paid to do that. I am in my third month with the Super Affiliate training, so I’m really just getting started. I didn’t know much about computers when I started this, so I am a bit “behind” other Wealthy Affiliate members who have computer and website experience. People with that kind of experience are making money faster.

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