Warren Buffett doesn’t have a 401(k) . Neither does Grant Cardone. And I don’t have one anymore either. I paid penalties to exit my retirement accounts where I had millions of dollars sitting idle. Most people would think I’m crazy, but this decision was one of the smartest financial moves I’ve ever made.
When I was 30, bankers convinced me to build an IRA and 401(k). Later, these same advisors were telling me to figure out how to exit these accounts. The contradiction was glaring. Why plan an exit from work when you’re just getting started? It’s absurd to focus on retirement at 30 when you won’t stop working until you’re 70 – if ever.
The Illusion of Control in Retirement Accounts
Let me be clear: when your money is locked in retirement accounts, you are not in control. Your account exists “for benefit of” (FBO) someone else first:
- The government dictates when and how you can access your money
- Fund managers you’ve never met make investment decisions
- Financial advisors tell you, “high risk equals high return
- Companies charge fees whether you win or lose
This system is designed for you to take all the risk while others collect guaranteed returns through fees and commissions. I realized I was playing a game where the deck was stacked against me.
What Wealthy People Actually Do
Look at Warren Buffett. He doesn’t have a 401(k) – he owns companies like Berkshire Hathaway. He controls the outcome. He receives dividends and has voting rights. He’s not passively hoping the market rises; he actively drives value creation.
The wealthy build and own. Poor people save and hope. This fundamental difference in mindset separates those who achieve financial freedom from those who remain trapped in the system.
When I paid the penalties to exit my retirement accounts, I freed up capital to invest in businesses and assets I understood and could control. This shift gave me:
- Monthly cash flow instead of delayed gratification
- Control over my investment decisions
- The ability to adapt to changing market conditions
- Freedom from government restrictions on my money
The traditional retirement model assumes your working years are something to endure until you can finally escape. But what if we flipped this thinking entirely?
Plan Your Expansion, Not Your Exit
When you lock money away in a 401(k) at age 30, you’re not investing in your future – you’re planning your exit. You’re essentially saying, “I can’t wait to stop working someday.” That’s not wealth building. That’s resignation.
Instead of planning retirement, I focus on expansion. I build businesses. I invest in things I understand. I create cash flow that pays me every single month. This approach has transformed my relationship with work and money.
Rich people never worry about their retirement accounts.
Why? Because they’re too busy creating assets that generate ongoing income. They’re building systems that work for them rather than working for systems designed by others.
The conventional wisdom about retirement planning is deeply flawed. It assumes you should defer living your best life until some distant future date. It presumes you need to sacrifice today for tomorrow, when in reality, you can design a financial life that serves you now and later.
My advice? Create a life you don’t want to retire from. Build businesses and investments that generate passive income. Take control of your financial future instead of delegating it to fund managers and government regulations.
The greatest financial freedom comes not from having a large retirement account balance at 65, but from creating cash flow that supports your desired lifestyle at any age. When you shift from the accumulation mindset to the ownership mindset, everything changes. You stop counting the years until retirement and start counting the opportunities in front of you right now.
