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Traditional vs Roth 401k/IRA
Posted: Mon May 19, 2014 8:43 am
by DaDaDan
How should I consider the difference between a traditional vs Roth account? If I put the same dollars into both, Roth wins, but it takes more pretax income to fund a Roth at the max. So, this is not an apples-to-apples comparison.
Should I just reduce my Roth contributions by my income tax rate?
Re: Traditional vs Roth 401k/IRA
Posted: Mon May 19, 2014 4:32 pm
by jimr
Reducing the estimated Roth contribution by your tax rate probably makes sense, especially if you're likely to contribute less because of taxes.
You might be interested in a discussion about Roth vs Traditional IRAs from an online forum called Bogleheads:
http://www.bogleheads.org/forum/viewtopic.php?t=55871
The topic covers interesting subtleties that may be important to understand before making a choice between a traditional IRA and a Roth IRA.
Re: Traditional vs Roth 401k/IRA
Posted: Thu Sep 04, 2014 8:33 am
by Spikky
Should I just reduce my Roth contributions by my income tax rate?
Re: Traditional vs Roth 401k/IRA
Posted: Thu Sep 04, 2014 10:31 am
by jimr
That seems reasonable, but I'm not in a position to give personalized financial advice.
I'd suggest taking a look at the link above and visiting the 'help with personal investments' area of that forum. There seem to be several knowledgeable posters there who will gladly answer detailed personal financial planning questions.
Jim