Core Insights - The article discusses the choice between owning a $1 million home and having $1 million in a 401(k) for retirement, highlighting the advantages of liquidity and flexibility offered by a 401(k) compared to the stability of homeownership [1] 401(k) Overview - A 401(k) is a tax-advantaged retirement account that provides tax deductions on contributions, with withdrawals taxed at ordinary income rates [1] - Investment options typically include index funds and target-date funds, allowing for flexibility in withdrawals, although penalties apply before age 59½ [1] - Financial planners favor the 401(k) for its liquidity and control over investments, emphasizing the importance of access to funds in retirement [1] Homeownership Overview - Owning a home provides a place to live without monthly rent or mortgage payments, but incurs ongoing costs such as property taxes and maintenance [1] - From Q1 2020 to Q3 2025, home prices increased nearly 55% nationally, though appreciation varies by region and does not account for homeownership costs [1] - Financial planners express concerns about the ongoing expenses associated with homeownership, which can outweigh the benefits of having a physical asset [1] Decision Factors - The choice between a 401(k) and a home depends on individual retirement needs, with a 401(k) offering low fees and easy access to funds, while homeownership may appeal to those wanting to avoid rental payments or pass down property to heirs [1] - Homeownership lacks liquidity but can provide equity access through options like reverse mortgages [1]