Posted: 11/7/2025 2:52:38 PM EDT
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Currently: $7,000 ROTH $23,500 401K These are split currently to achieve a roughly 50/50 ROTH/Traditional between the total amount. My top marginal rate between Federal and State is 30.85% If I changed contributions to 100% traditional and invested into a 457 plan I could invest an additional $5,000 per year, roughly meaning I could go from $30,500 to $35,00 without changing my take home income. Of course this opens me up to liabilities in the future as far as taxes and RMDs. |
WTF is up with this bullshit anti-bayo lug crap. Was there a group of irrate japanese guys bonzai charging disabled school children and puppies that I wasn't aware of?
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Originally Posted By Silverbulletz06: Currently: $7,000 ROTH $23,500 401K These are split currently to achieve a roughly 50/50 ROTH/Traditional between the total amount. My top marginal rate between Federal and State is 30.85% If I changed contributions to 100% traditional and invested into a 457 plan I could invest an additional $5,000 per year, roughly meaning I could go from $30,500 to $35,00 without changing my take home income. You're also using imprecise language - do you mean $7k roth IRA and $23.5k 401k(pretax or roth 401k?) Also, the "I could invest an additional $5,000 per year" is incomplete. You could invest that money in a taxable brokerage account right now and pay only 15 percent long term capital gains (maybe zero with some planning!) rather than your marginal tax rate when you withdraw the money from a retirement plan. Aren't you married? I thought you were already old enough for catch up contributions? Obviously you're either 22 or 24 percent federal bracket? If so I would max your 401k with pretax contributions. Do you really think your income will increase enough to put you into the next higher federal bracket when you retire? |
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Another thing to think about is your NYS income tax. Are you staying after retirement or moving to a state that doesn’t have income tax or otherwise does not tax retirement savings? If you are not staying then not paying state income tax now means you skip out on giving Hochul extra to waste. If you go deep on Roth your paying the NYS income tax on it. Unless I am more ignorant than usual. 
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The only hyphenated names I like are cartridge names......30-06, 30-40, 38-55 etc.
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Originally Posted By Morgan321: You've left out tons of details needed to determine what is best. You're also using imprecise language - do you mean $7k roth IRA and $23.5k 401k(pretax or roth 401k?) Also, the "I could invest an additional $5,000 per year" is incomplete. You could invest that money in a taxable brokerage account right now and pay only 15 percent long term capital gains (maybe zero with some planning!) rather than your marginal tax rate when you withdraw the money from a retirement plan. Aren't you married? I thought you were already old enough for catch up contributions? Obviously you're either 22 or 24 percent federal bracket? If so I would max your 401k with pretax contributions. Do you really think your income will increase enough to put you into the next higher federal bracket when you retire? $7k Roth IRA and $23.5 401k. Between the two I split about 50/50 pre/post tax for the total contibutions. I can get access to a 457 account as well, so I could move the ROTH contribution tax costs into more savings, effectively increasing from 30.5k to about 36k. We already are doing a brokerage, looking to save more in total tax liability. |
WTF is up with this bullshit anti-bayo lug crap. Was there a group of irrate japanese guys bonzai charging disabled school children and puppies that I wasn't aware of?
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Originally Posted By SteelonSteel: Another thing to think about is your NYS income tax. Are you staying after retirement or moving to a state that doesn’t have income tax or otherwise does not tax retirement savings? If you are not staying then not paying state income tax now means you skip out on giving Hochul extra to waste. If you go deep on Roth your paying the NYS income tax on it. Unless I am more ignorant than usual. We are out like a fat chicken in dodge ball once we retire. Originally Posted By 1168RGR: Do you mean that your income tax burden would be reduced sufficiently to allow you to invest more with no impact to your takehome pay if you switched to all tax-deferred for both IRA and 401k and no Roth-type contributions? Yes. Same take-home but more money into the system. |
WTF is up with this bullshit anti-bayo lug crap. Was there a group of irrate japanese guys bonzai charging disabled school children and puppies that I wasn't aware of?
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Originally Posted By Silverbulletz06: I can get access to a 457 account as well, so I could move the ROTH contribution tax costs into more savings, effectively increasing from 30.5k to about 36k. We already are doing a brokerage, looking to save more in total tax liability. You also have to consider RMDs, more SS taxed due to the pretax withdrawals raising your taxable income, Irmaa, if/how you want to leave money to people when you die, and how one of you dying will be a major tax hit on the living spouse when they have to file in the single tax brackets. You need a complete picture to actually know which is better for your specific situation. Anybody who tells you otherwise is making things up out of thin air. |
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Generally a Roth is not the best choice if you are in a higher federal tax bracket. However since you mentioned a 457 I’ll guess that you work for the state or local government. If you have a good pension choosing to pay a higher federal tax now to use a Roth could make sense. I am not a government worker but I do have a pension and when I ran various scenarios of pre tax vs Roth the results were mostly a wash. That being said I have been contributing 100% Roth 401k for a few years. |
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Originally Posted By rc2: Generally a Roth is not the best choice if you are in a higher federal tax bracket. However since you mentioned a 457 I’ll guess that you work for the state or local government. If you have a good pension choosing to pay a higher federal tax now to use a Roth could make sense. I am not a government worker but I do have a pension and when I ran various scenarios of pre tax vs Roth the results were mostly a wash. That being said I have been contributing 100% Roth 401k for a few years. I do not have a pension. I get a substantial 403B amount added. |
WTF is up with this bullshit anti-bayo lug crap. Was there a group of irrate japanese guys bonzai charging disabled school children and puppies that I wasn't aware of?
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