The short answer: a 404 is not a penalty. Google expects some pages to disappear, and a handful of 404s is normal and healthy. The problem is not the 404 itself, it is what points to it and what you lose when it happens without a plan.
A page that never had traffic, links or purpose can return a 404 without consequence. Google removes it from the index and moves on. Forcing a redirect for every deleted page creates more clutter than it solves.
A soft 404 is worse than a real one: the page returns a 200 status but has no real content, so Google treats it as an error without you noticing. Thin pages, empty search results and broken templates cause it. These need real content or a proper status code.
We treat 404s and redirects as part of technical SEO hygiene, not a one-off cleanup: broken links fixed at the source, equity-bearing URLs redirected on purpose, and a crawl that spends its budget on pages that matter. It is part of our SEO & AI Search work.
If you are migrating a site or blog, this is exactly where equity leaks. The Diagnosis shows where.