Traditional or ROTH retirement account?

[Mandarin Duck]

Which did you guys sign up for and why?

The idea of having a lower taxable income seems like an incentive, but I'm also not trying to pay once I'm retired.

Which do you prefer?

 

[Pistolvania Prince]

If you are straddling the fence as far as brackets go, then a traditional certainly has its benefits.The deduction of taxable or income plus the fact that If you are retired & your income is low enough, you would have a 0% capital gains tax rate on your profits anyways.

BUT if you already maxed out your 401k contributions (or up to the match) & are in a higher bracket then a Roth is what I would invest & would go very aggressive there to take advantage of the tax free profits before retirement

 

[Mandarin Duck]

If you are straddling the fence as far as brackets go, then a traditional certainly has its benefits.The deduction of taxable or income plus the fact that If you are retired & your income is low enough, you would have a 0% capital gains tax rate on your profits anyways.

BUT if you already maxed out your 401k contributions (or up to the match) & are in a higher bracket then a Roth is what I would invest & would go very aggressive there to take advantage of the tax free profits before retirement

What if I'm in a middle position now, but will eventually be moving into upper management?

I'm single in the 22% tax bracket now.

 

[mrallgood]

Why not both....company match for traditional and do a roth one outside the company

 

[Be Strong Blackman]

Have both

 

[Menna]

Depends on how old you are and what else you have...If you had a side business 1099 or LLC you can have those deductions lower your W2 salary so the argument would be totaly for the ROTH especially if your younger....If you strictly just want to lower your taxable income and dont care about paying taxes later then its traditional for you. The returns are the same depending on if you pick the same fund inside the 401k ... it comes down to taxes and age/time

 

[invincible1914]

I just do Roth. I'm not an expert, but I feel as if I could stand to pay taxes now rather than later.

 

[Wargames]

If you can pay the taxes do Roth

 

[invincible1914]

My company switched 401k providers last November and I've been putting 6% in out of every check, and I haven't gained a dime. All I'm doing is giving money away.

My rate of return since January is -8.92%

Why they do this? might as well keep the money and burn it up like the joker.

Edit: I just switched my contribution to 0%. I will find my own provider.

 

[Menna]

My company switched 401k providers last November and I've been putting 6% in out of every check, and I haven't gained a dime. All I'm doing is giving money away.

My rate of return since January is -8.92%

Why they do this? might as well keep the money and burn it up like the joker.

Edit: I just switched my contribution to 0%. I will find my own provider.

Bro the Market has been down for the past 3-4 months. Its not the provider its the investments within the 401K...Just switch to a 1-2% moneymarket now while the market is down and then ext month or the next or the next when things recover switch to a large cap growth fund...Its not the provider its the investments within the 401k...The provider doesnt lose you money the investment funds do.

 

[invincible1914]

Bro the Market has been down for the past 3-4 months. Its not the provider its the investments within the 401K...Just switch to a 1-2% moneymarket now while the market is down and then ext month or the next or the next when things recover switch to a large cap growth fund...Its not the provider its the investments within the 401k...The provider doesnt lose you money the investment funds do.

So right now I should just put that extra money in savings getting interest and reinvest it later?

I've lost $631.17 since January 1and the rate of return dropped to -9.24% overnight.

If it wasn't for this thread I wouldn't have even checked.

 

[d3koms]

Having both breh

 

[princeofhaiti]

My company switched 401k providers last November and I've been putting 6% in out of every check, and I haven't gained a dime. All I'm doing is giving money away.

My rate of return since January is -8.92%

Why they do this? might as well keep the money and burn it up like the joker.

Edit: I just switched my contribution to 0%. I will find my own provider.

it has more so to do with market year to date, my 401k year to date at my new company is -9%. the market as a whole has been down. i would recommend only putting the company match for 401k. my last company matched 6% but my budget only allowed 3%

 

[phcitywarrior]

Do both. But I only contribute up to the match in my company (5% with a 2-to-1 match). But tbh, with the way things in the world are going, Idk if the concept of a 401K still gonna be around in the next 40 yrs by the time I hit "retirement", I'm still contributing because there's house money on the table.

 

[NZA]

if you have enough money, do both. if you can only do one, do the 401k until the employer stops matching. that is free money. do roth when done with the employee matching in the 401k