Re: does 401K benefit us? - 未名空间MITBBS历史存档

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Re: does 401K benefit us?

Re: does 401K benefit us?# Working - 上班一族

l*g2005-01-11 08:01

1 楼

yes and no.
it all depends on the specific plan, your income level and your tax rate.
if you are not making top salary, meaning not close to the top tax brackets,
you'd better pay current historical low tax than putting money into tax-defered
account risking paying more tax when you withdraw.
You should always do following in the order of
1. max out company match( e.g. 50c+ on a dollar)
2. roth ira
3. more 401k, or other investment if got too much cash.

aw2005-01-11 08:01

2 楼

suggest you read more online about roth ira.
simply put, roth ira is after tax $$$ now, then you put in an account to
invest, all gains/principle are tax free when you retire and withdraw $$$ from
it;
unlike you invest with your after tax $$$, which you need to pay tax next year
if you make profits.
unlike 401k, which is tax deferred (you still need to pay tax when you
withdraw from it).

brackets,

s*o2005-01-11 08:01

3 楼

I don't think roth ira has clear advantage over traditional ira or 401K. It
depends on one's current tax rate and the rate when he/she retires. If tax
rates is the same, then there is no difference. But to foresee your tax rate
at 59.5 is difficult, it could be lower or higher than your current rate.

from
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【在 aw 的大作中提到】

: suggest you read more online about roth ira.
: simply put, roth ira is after tax $$$ now, then you put in an account to
: invest, all gains/principle are tax free when you retire and withdraw $$$ from
: it;
: unlike you invest with your after tax $$$, which you need to pay tax next year
: if you make profits.
: unlike 401k, which is tax deferred (you still need to pay tax when you
: withdraw from it).
:
: brackets,