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In a recent Reddit post, an important question came up. The Reddit user said they make $135,000 annually and work at a job that offers both a traditional 401(k) and a Roth 401(k). Their company ...
November 25, 2024 at 1:07 PM. ... any employer match in a Roth 401(k) may be held in a traditional 401(k), ... That percentage of the conversion is subject to tax at ordinary income tax rates.
Traditional 401(k)s allow employees to contribute pre-tax dollars, where Roth 401(k)s allow after-tax contributions. Income taxes: If you choose to make a pre-tax contribution, your contributions ...
The funds may also be switched if the employee changes employers. An employer's matching program is situational and depends on if a workplace offers one. According to the Profit Sharing/401k Council of America, an industry trade group, about 78% of 401(k) plans include some kind of employer match for employee contributions. [5]
“If your employer offers a 401(k) with a match, your first goal is to contribute up to the max of the match,” Meyer said. ... will give you the same tax benefits on your growth as the Roth 401 ...
The 401(k) has two varieties: the traditional 401(k) and the Roth 401(k). Traditional 401(k): Employee contributions are made with pretax dollars, lowering your taxable income. Your contributions ...