Questions tagged [roth-401k]

A specific retirement plan in US. Related US specific retirement plan tags "Roth IRA" and "401K"

49
votes
4answers
5k views

Recent graduate with new job: Choose Roth 401(k), or traditional 401(k)?

I just graduated, and I'm starting a new job soon. My employer has pretty good policy for matching 401(k) contributions, so I want to invest as much as possible, especially during this first year. My ...
27
votes
3answers
1k views

Do traditional and Roth 401k have the same annual contribution limit?

According to everything I can find, the annual contribution limit for both traditional and Roth 401k is the same ($16500 in 2010). Since the Roth is post-tax, doesn't that mean I can save more for ...
21
votes
3answers
5k views

Laid off at age 54 1/2, am I eligible to withdraw my 401k money without penalty?

I will be turing 55 this year in November. I got laid off 2 weeks ago (April 4, 2016). I worked in New York City and live in NJ. Can I withdraw my 401k without penalty?
18
votes
11answers
10k views

Is your future tax bracket the ONLY consideration for Roth vs Traditional 401(k) accounts?

I understand that Roth contributions get taxed on the way in. Income tax now at whatever tax brackets currently apply, no tax to pay when I take distributions at retirement. I understand regular pre-...
17
votes
4answers
3k views

Confusion about Roth 401K: Better for me to do pre-tax or Roth post-tax contributions?

My company offers a 401K and a Roth 401K. Given the income level of my family (married filing jointly status), IRAs aren't really an option. We're past the Roth IRA limits and get no deduction for a ...
14
votes
1answer
4k views

Can I withdraw Roth 401k contributions penalty-free before age 59.5?

I know that with a Roth IRA, contributions can be withdrawn penalty-free at any time. If I rollover a Roth 401k into a Roth IRA, can I do the same with the contributions made to the Roth 401k? I've ...
12
votes
3answers
1k views

Employer offering Roth 401k as well as traditional 401(k), established in career

I am 33 years old and currently enrolled in my employers traditional 401(k) plan where I am putting 4% of my salary pre tax and having a maximum of 4% employer match into my plan. After 6 more months ...
11
votes
3answers
28k views

Could a 401k or IRA contribution switch my current taxable income to a lower tax bracket? is this the same for traditional and Roth 401k?

In the case that my annual income is right in the limit between one tax bracket and the next tax bracket. Can contributing to a 401k or IRA reduce your present income declaration in such a way that ...
11
votes
1answer
7k views

Should I use a Roth 401K rather than 529 to save for children's college?

I have set up a 529 for my child's college fund but the more I look at it the less useful it seems compared to alternatives. The 529 is quite restricted -- What if she doesn't go to college? What if ...
10
votes
3answers
2k views

Should I consolidate my retirement plans if both are performing well?

I worked for a company between 2010-2014, and have an established retirement plan through T. Rowe Price which they matched into. In 2014, I changed jobs and had a new retirement plan opened under ...
10
votes
1answer
2k views

Can I contribute to a 401k, Roth 401k and Roth IRA at the same time?

My company provides me access to 401k, and I am contributing the maximum allowed in that 401k. In addition I also have Roth IRA (I qualify for it because of income less than $193000). Recently, my ...
9
votes
2answers
853 views

When should I switch from after-tax to pre-tax retirement savings?

I am contributing to my employer's Roth 401(k). The consensus in this question is that when you're young you should make your retirement contributions after-tax so that they grow tax free, and that ...
9
votes
2answers
235 views

What is the maximum I can have stored in a traditional 401(k) and a Roth 401(k)?

I know there are annual limits to how much can be contributed (both from the employee and from the employer). But what about over the lifetime of the investment? If I max-out every year (say $16500),...
8
votes
3answers
878 views

Can I still contribute to a traditional IRA if it is not deductible? Should I?

I'm really confused about my saving situation, despite all of the articles and information I have found online. My employer offers a Roth 401(k), and I'm contributing up to the maximum employer match ...
8
votes
2answers
14k views

If I Use My Roth 401K for a Downpayment for My 1st Home, What Will I Be Taxed On?

I've been making post-tax contributions to my employer's Roth 401K plan for a little over 3 years now, and I'm needing some cash for a downpayment for my first home. Will I be taxed on the full amount ...
8
votes
3answers
563 views

How safe will Roth IRAs/401(k)s be going forward re: US's deteriorating fiscal position?

I've on and off wondered how "safe" Roth accounts are and things like this anti-Roth screed in the LATimes and this blog post at the Atlantic talking about the sad fiscal shape of the US has me ...
8
votes
1answer
3k views

First time home buyer: Can you withdraw funds from a Roth 401k for a first time home purchase?

I have a Roth 401k. Soon I will have enough debts paid off that I would like to start building up a down payment for a house. The house purchase will be my first, and will be over a year from now. (...
7
votes
2answers
1k views

Roth 401k when reached maximum AGI

I have a Roth IRA, but recently my wife and I reached annual income that makes contributions not permitted anymore. We both have 401ks at our work - Does the same rule apply to a Roth 401k? If we both ...
7
votes
6answers
469 views

What factors should I take into account when deciding how much of my 401(k) contribution should go into my Roth 401(k)?

My employer allows new contributions to my 401(k) to go in as Roth (post-tax) or "regular" (pre-tax). What should I consider when deciding how to distribute my contributions between the two?
7
votes
3answers
443 views

How should I be contributing to my 401(k), traditional or Roth?

My company just started offering an 401k plan in place of a Simple IRA. I am able to contribute into my 401k two different ways, traditional or roth. From the way I understand it, traditional ...
7
votes
3answers
481 views

How is a Roth 401(k) split during a divorce, and can a spouse's share be liquidated?

I am in the midst of negotiating a divorce where my spouse would prefer, whenever possible, to get cash instead of a retirement account. I have found many sources online (e.g., this one) stating that ...
7
votes
1answer
176 views

Roth and Traditional 401k - Is it a valid strategy to withdraw from traditional for lower brackets, and then switch?

Given I am investing heavily in Roth 401k and also some in Traditional 401k... I was wondering if it is a valid retirement strategy [after retiring] to withdraw the first couple lower tax brackets ...
6
votes
3answers
1k views

If my 401k plan allows for pretax and Roth contributions, why would I want to open an IRA?

My company is switching to a 401k plan provider that allows for both Roth and pretax contributions. If I can make either type of contribution to this plan, why would I want an IRA? The previous 401k ...
6
votes
4answers
517 views

Changing jobs: Should I cash out Roth 401(k) or move it to another account type?

I am currently looking at changing jobs from a large corporation to a smallish company. I currently have only about $4k in a Roth 401(k) though my current employer. The smaller company does not offer ...
6
votes
2answers
607 views

If I'm eligible to max a Roth IRA, Do I ever considering putting money in both IRA types instead?

Age 28 (Turn 29 in November) Gross Income - 110,050 Retirement (At the start of 2015) - $12,000 in Roth IRA My current contribution for the year is aimed at: 9,000 in Roth 401k 9,000 in ...
6
votes
1answer
438 views

Do Roth 401(k) and Roth IRA plans share the same annual contribution limit?

I've contributed $2000 to my Roth 401(k) plan through my employer, and $4000 to my Roth IRA plan that is totally separate from my employer. My accountant says that the limit on Roth IRA contributions ...
6
votes
2answers
409 views

When rolling over a Roth 401(k) to a Roth IRA, does one have to pay any tax?

When rolling over a Roth 401(k) to a Roth IRA, does one have to pay any tax as a result of the transfer? For example, are the earnings resulting from the Roth 401(k) investments taxed when transferred ...
6
votes
2answers
559 views

Which should I prefer, traditional or Roth 401k? [duplicate]

Possible Duplicate: Recent graduate with new job: Choose Roth 401(k), or traditional 401(k)? I'm just a few years out of college, and am starting to put aside some retirement savings. My employer ...
6
votes
1answer
449 views

Will a Roth 401k rolling over to a Roth IRA allow the money to become penalty-free at withdrawl?

I'm aware that a Roth 401k and a Roth IRA are funded with after-tax amounts, and no taxes are incurred upon withdrawal. However, I have stumbled upon a few articles that state a 10% penalty early ...
6
votes
1answer
258 views

What happens when a Roth 401(k) contribution interferes with payroll taxes?

I tried looking up this up on Google but there were too many irrelevant search results. I also perused through the Roth 401(k) Plan documents but was not able to find a section on this. My salary is ...
6
votes
2answers
449 views

Withdrawing from regular vs Roth 401K

I work at a company that allows me to put my 401K into either a regular or Roth 401K. My understanding is that: For the regular 401K, I pay taxes when I withdraw money from the 401k. For the Roth, I ...
6
votes
1answer
920 views

Roth 401k rollover into Roth IRA: How are earnings handled?

I have a Roth 401k from a prior employer and I want to roll it into a Roth IRA. For simplicity, let's assume there are no pre-tax employer match funds in the 401k, only my after tax contributions and ...
6
votes
3answers
1k views

Mega Backdoor Roth: Withdrawal consequences for in-plan vs out-of-plan conversion

My employer allows after-tax 401k contributions, and has an option for automatic quarterly after-tax 401k -> Roth 401k in-plan conversions. The other option for executing the mega backdoor Roth is to ...
5
votes
4answers
938 views

What are the advantages of a tax deferred investment account?

So, I suspect I am missing something huge about this. But I notice there is a lot of talk about retirement accounts recently such as 401-Ks and IRAs. I understand these come in two flavors, ...
5
votes
2answers
379 views

Confusion about 401k and Roth 401k

I just started working for company, and this is my first time doing anything with a 401(k) plan. I found out this from the brochure, and I am a little confused: 1) you can save up to 80% of your ...
5
votes
2answers
258 views

Future viability of Roths

In the spirit of this question, now 4 years later, I'd like to know if there are any concerns with the future "security" of Roth accounts. I'm currently maxing out mine and my spouse's Roth and ...
5
votes
2answers
292 views

How late is Roth (rather than pretax) still likely to help?

Given the choice, should one switch from Roth to traditional IRA/401k contributions as one approaches retirement, and if so is there any good way to decide when? If it affects the decision, I am ...
5
votes
4answers
320 views

Can I do periodic rollovers from my low-perfoming 401k to an IRA?

My current 401k performs poorly, and has a very limited selection of funds. I do Roth contributions, with non-Roth employer matching. My Roth IRA allows me to select funds that perform significantly ...
5
votes
2answers
386 views

Can I hire my wife to max out another roth 401k?

I own my own company. I am maxing out my roth 401k with a match of 4%. Can hire my wife and pay her just enough to max out another roth 401k?
5
votes
1answer
8k views

Can I do a Roth 401k rollover to Roth IRA and withdraw contributions I've made this year?

I am leaving my current job. Can I do a rollover from my existing Roth 401k, to a Roth IRA, and then withdraw my contributions and vested employer contributions from this year and stick them into a ...
5
votes
1answer
238 views

Where should I take some money from after retirement? (IRA, 401K, Roth, Taxable)

I have three 401ks, each doing well. One has some pre-1987 money, another has some Roth money, and some has post tax, non Roth money. I also have several smaller IRAs and Roth IRAs, some of them ...
5
votes
1answer
280 views

Company Switched 401(k) Provider & Failing Highly Compensated Employee Test

My company switched 401(k) provider in Q3 of 2016 and at the time of the switch I've already contributed $15K Roth into the account for the 2016 calendar year. Then came the notice that I've failed ...
5
votes
2answers
3k views

Has backdoor Roth IRA been changed in 2018?

Are normal backdoor Roth IRA and mega backdoor Roth IRA still possible in 2018 tax plan? I had troubles figuring it out due to number of different plans.
5
votes
2answers
4k views

Can you recharacterize a Roth 401(k) contribution?

I understand that you can recharacterize Roth IRA contributions back into traditional IRA contributions by the next April 15, if you change your mind and decide it would make sense. Then you won't owe ...
5
votes
1answer
372 views

Contribute to both a SEP IRA and solo Roth 401(k)?

I am self employed in a business venture. Could I theoretically contribute to a SEP IRA where the maximum contribution is $50,000 and to a Solo Roth 401k where the max contribution is $17,500? I ...
4
votes
3answers
933 views

Savings account vs Roth 401k

Is there any reason to have a savings account if you have a Roth 401(k), which allows early withdrawal of principal? If pooled together, couldn't you get the liquidity of a savings account and, if ...
4
votes
3answers
371 views

Advantage of Traditional 401k over Roth

I am trying to understand the differences and benefits of putting money in Traditional 401k over Roth 401k. If I have to still pay tax while withdrawing money from my Traditional (pre tax) 401K after ...
4
votes
2answers
444 views

Are 401(k) & IRA Contribution Limits Mutually Exclusive?

Are the $18,000 401(k) 2017 limit and the $5,500 IRA limit mutually exclusive for a combined limit of $23,500 (under 50)? Or are they inclusive, meaning $5,500 in an IRA, would limit a 401(k) to $12,...
4
votes
1answer
1k views

5 year rule on Roth 401k to Roth IRA rollover containing converted amounts

Suppose In tax year t, I contribute 10000 to a Roth 401k and 10000 to an after tax 401k. By tax year t+1, both amounts have grown by 10000 to 20000. In tax year t+1, I convert the full 20000 from the ...
4
votes
2answers
800 views

Any downsides to having both 401k AND Roth 401k

So currently I have a 401k, I went ahead and added a Roth 401k while I'm eligible, beyond the fact I'll have to pay tax on the contributions now without the tax on withdrawal later in life you'd see ...