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Ask HN: Should I cash out my 401K and try to get my dream job?

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Ask HN: Should I cash out my 401K and try to get my dream job?

#1

Post by notarockstar »

I'm a professional and conscientious engineer who loves developing software. I've been doing this for 13 years. I've worked for a few small software companies, working on commercial software. I know I'm a great developer, but I think the fact that:

* I don't have a GitHub profile, * have not contributed to any OSS projects, * don't answer a ton of question on StackOverflow, * cannot share any of the code I've worked on * and so forth,

...are not helping in the search for my dream job. These are the things that seem to get people to show interest in a developer these days.

I have no time, (or I'm not allowed), to do any of these things while working full-time for an old-school software company. I'm considering cashing out my 401K to live on for the next 6 months and spending all of my time working on these types of things to make myself a more attractive candidate. This would really make me happy, but is quite a gamble given that I have a family.

Thoughts? Has anyone here done something like this?

Re: Ask HN: Should I cash out my 401K and try to get my dream job?

#3

Post by patio11 »

Many of the world's best engineers don't have a Github / OSS contributions / Stack overflow / etc. They're still quite hireable. It is highly likely you are also hireable, even without a portfolio that you can conveniently point to, although that would be an asset.

Do not cash out your retirement account. [Edit: Generic personal finance advice for everyone: Unless your children will starve in the snow otherwise, it is never a good time to cash out your retirement account. It will be very tempting to tap it to pay for your wedding, your first home, a medical emergency, your kids' college, etc etc, but if you do this, you will not have it at retirement. This is far and away the largest risk associated with self-directed retirement accounts.] It is not required to buy coffee for people with the ability to hire engineers. Coffee is cheap and jobs are plentiful in the current environment.

Re: Ask HN: Should I cash out my 401K and try to get my dream job?

#4

Post by johnatwork »

notarockstar wrote: post #2

For clarity: my dream job is one that has a great culture, interesting work, is making money, and is remote friendly.

I'm in the exact same situation. I have a kid and a wife that take up the Lion's share of my time. As well as working at a PCI compliant company that forbids me from showing my best work to anyone else. It's a struggle and a challenge, but I've explained my situation and my frustrations to my wife and we try to carve out a few hours here and there and a few more over the weekends for me to build something that I'm able to show. We thought about quitting and dipping into our savings but for now it works and we can sustain this for a bit longer.

Good luck to you, and I hope that you will reach a resolution soon.

Re: Ask HN: Should I cash out my 401K and try to get my dream job?

#5

Post by notarockstar »

johnatwork wrote: post #4
notarockstar wrote: post #2

For clarity: my dream job is one that has a great culture, interesting work, is making money, and is remote friendly.

I'm in the exact same situation. I have a kid and a wife that take up the Lion's share of my time. As well as working at a PCI compliant company that forbids me from showing my best work to anyone else. It's a struggle and a challenge, but I've explained my situation and my frustrations to my wife and we try to carve out a few hours here and there and a few more over the weekends for me to build something that I'm ab…

I knew I was not alone, but it's good to hear it just the same.

Re: Ask HN: Should I cash out my 401K and try to get my dream job?

#6

Post by kirpekar »

Absolutely not. You will have to pay taxes on withdrawals and a 10% early withdrawal penalty. Depending on the size of the withdrawal, this will immediately set you back 6-7 years of the 13 you contributed. If you have ~30 years to retire, even a small withdrawal will set you back by 10 years at retirement. Run some basic compound interest calculations if you don't agree.

There are many other options: moonlighting, going part-time, reducing your responsibilities at work, taking an unpaid sabbatical, etc.

Re: Ask HN: Should I cash out my 401K and try to get my dream job?

#7

Post by smileysteve »

1) Do not cash out of your 401k. The penalty and taxes make this never worth it. Along with you not getting the long term compounded interest it is started as. Instead, work for a few more months to have an "emergency fund" that allows you to live life without an income for a few months.

Re: Ask HN: Should I cash out my 401K and try to get my dream job?

#8

Post by pdq »

What part of the US or world are you located? Are you wanting to build your own startup, work for a startup, or something else? Are you looking to learn new languages or technologies?

The reason I ask is because if you already have a decent skillset, you may be able to get a new job at a startup and learn new skills at the same time (and thus not need to cash out your retirement fund). Simply contributing to open source projects IMO is not that valuable unless you want to prove experience in a languages you've never used professionally.

Re: Ask HN: Should I cash out my 401K and try to get my dream job?

#9

Post by officialjunk »

Just a point if clarification: by "cash out" do you mean all/majority of your 401k? If so it's not a good idea. Some small percentage could be considered, by in general you should only do so in an emergency. There are penalties for early withdrawals.

Can you dedicate an hour a day to OSS? Or perhaps spearhead an project at work to be open sourced?

Have you tried applying for positions that qualify as your dream job? If you haven't, you may want to start and see if those open source contributions are as key as you think.

Re: Ask HN: Should I cash out my 401K and try to get my dream job?

#10

Post by ronaldx »

kirpekar wrote: post #6

Absolutely not. You will have to pay taxes on withdrawals and a 10% early withdrawal penalty. Depending on the size of the withdrawal, this will immediately set you back 6-7 years of the 13 you contributed. If you have ~30 years to retire, even a small withdrawal will set you back by 10 years at retirement. Run some basic compound interest calculations if you don't agree. There are many other options: moonlighting, g…

> Run some basic compound interest calculations if you don't agree.

Make sure to include basic compound inflation because the figures given here seem to be hyperbolic.

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