[USER]

I’m currently maxed out in my 401k- it is not matched. We max out my husband’s Roth IRA. But I do not max out mine because at this time, we can’t afford to do that.

Would you recommend keeping my set up as is or lower my 401k to be able to max out my Roth?

It’s a municipal job- there is no employer match.

[Kristen]

Depends on the funds offered in your 401k, your tax situation and whether you have kids entering college.

I’m putting as much as I can in mine for fafsa purposes, and I put my Fidelity cash back rewards into my Roth.

It’s not a lot, but it’s something.

[John]

If the traditional puts you in a lower tax bracket use it. If it doesn’t I would max the Roth for sure. Having a huge traditional IRA can bite you later in retirement.

Ask any older affluent person about forced RMD’s.

I used Traditional heavily in the last 5 years of working with a 50% savings rate to accelerate my FI situation and get to RE faster

[Sandy]

Do you prefer to take the tax deduction now or later? If the answer is now, then continue maxing the 401(k). If it’s later and a Roth is better for your situation (i.e. you expect your taxes will be higher in retirement) then is there a roth option in your 401k?

If no, direct funds to your Roth IRA. If yes, does your 401(k) provide the investment options you want?

Is the plan’s overall cost higher or lower than your Roth IRA? I’d go with the lower cost option that provides the investment options you want.

[Aaron]

I’d rather max out your ira first due to better investment options and lower fees.

[Amber]

It depends heavily on your tax bracket now and what you expect it to be in retirement. If you need the tax deduction now, keep doing what you are doing.

If not, I’d shift to maxing the Roth and lower the 401k.

If you are still able to contribute directly to a Roth, likely you don’t need the tax deduction now.

[Patrick]

IMO without a match a Roth is worth more in the long run.

[Author]

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