Oh, so THAT'S what a 401k is for!

I have something to confess. I don't have a 401k. I've actually never contributed to a 401k. Not that I don't plan on starting one once I get settled into my career, because I do. I hear that they are important for retirement. Or, at least, they were...before the economy went to shit. But I hear that the economy might be getting better, and that money put into a 401k actually WILL be helpful to me in my retirement age. So I suppose that I can't wait to start one. But I digress...

Stephanie and I were talking about insurance. She tells me that she doesn't really see the point in having insurance, as it's more money to pay each month, and she's thinking of just getting rid of it (side note: she used to have insurance with her job, but she quit her job about 6 months ago, because she felt it was holding her back; so she now just pays for health insurance out-of-pocket). I somewhat agree, and tell her that the thought of just taking chances and NOT having health insurance has actually crossed my mind. But then my parents talked some sense into me, and reaffirmed that insurance is just that: insurance IN CASE an emergency happens, and so you're not screwed paying a ridiculous amount of medical bills. I tell Stephanie such, and try to tell her all about the benefits of health insurance.

She then changes the subject, and tells me that she recently had to dip into her 401k. I am immediately worried; does she not have money to pay rent anymore? Can she no longer help pay utility bills? Perhaps this is why she didn't want to carry insurance, and I immediately feel bad because I possibly judged her reasoning too quickly.

Me: "Oh my goodness! Are you OK? Are you struggling for money right now?"

Stephanie: "Oh no, it's nothing like that. I actually have an appointment with a very exclusive plastic surgeon on Monday."

Me: (somewhat confused) "Oh. Ok. Why?"

Stephanie: "Well, I was excited to just get an appointment with him. He's usually booked solid! I want to see about getting laser surgery done on my face. I want my face to be completely flawless."

Me: "I think your face is fine. What are you talking about? Is that something you really need to use your 401k money for?"

Stephanie: "I just think that it's doing me no good just sitting there. I might as well use it, right?"

Now as I said, I don't have a 401k, so Stephanie is really one up on me for at least HAVING one. I don't even know all the minute details that go into it...but I'm pretty sure it's to be used when you're older and can't work anymore and still need some money. But of course I can see how laser surgery on one's face is also important for retirement.