[USER]

Need an input/feedback. I am 34yr old and trying to decide if I should contribute to Roth or Traditional 401(k) at work.

I am in a 24% tax bracket (single filer) and current income is approx $145K.

Work is offering 6% match dollar-for-dollar.

[Kasey]

I’m kinda in same boat. My thoughts are based on my plan of only needing $72,000 a year for my retirement income.

In which would be a lower tax bracket than I am in now 24%.

So, to maximize tax saving I am going traditional vs Roth.

[Sam]

Always contribute enough for the 401k match money first, then IRAs, before going back to 401k.

[Ralph]

Contribute up to the match, then ROTH all the way. Yes, you will pay taxes now, but based on your salary and the ROTH growth totally tax free you will be much better off later.

[Dave]

Most will recommend you do the Roth, and I agree. Also, I don’t know how high your salary is, but another way to look at it is that you should contribute to a Roth while your salary is still low enough to permit it.

One day you may make too much to contribute to a Roth anymore.

At that point, you’ll be glad you put money in the Roth while you still could.

Finally, when in doubt, you could hedge your bets by contributing half to the Roth and half to the traditional IRA.

[Bethany]

I max my Traditional 401k, Roth IRA, & HSA. I used to do Roth 401k but switched over to traditional and now take that $ difference and invest it in a brokerage account.

I want the tax benefit of traditional& intend to do a roth conversion ladder later on to help

[Gary]

As a general recommendation it’s almost always better to do Roth 401k. I sell health insurance and see so many clients still in a higher tax bracket because they need to withdraw from a traditional 401k.

Then they have to pay a lot for health insurance as well since their taxable income is still higher.

They pay on average 9% of their income towards health insurance until they turn 65 years old.

[Ran]

Roth makes a lot of sense at your age. Roths are exempt from minimum distributions when you retire and you can withdraw your contributions portion (tax and penalty free) after you meet some basic qualifications much earlier than the Traditional retirement age.

Consider the national debt too, taxes will eventually go up in the future, Roth will protect you.

[Brian]

I max my pre tax 401k to fully max my Roth IRA with the tax savings. I personally feel it’s better to have multiple paths.

[Zach]

Keep in mind that even if you go Roth, your employer match will operate as traditional

[Author]

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