Quote:
Originally posted by cappuccino:
I'm not familiar with those two plans, but I think a mix of pay now and pay later are good, especially if you have a long time before retirement. I have a 401k, which is tax deferred. What I've noticed as an immediate perk is that it reduces my current taxable income, which saves me taxes on each paycheck and especially at the end of the year. This plus 20+ years to retirement, the compounding effect of deferring adds up quickly.
I recently started a Roth too, and I like this after tax approach as well since you have less restrictions on withdrawls, etc.
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Sounds like you are pretty well versed in this stuff. Thanks for replying. How would you change that as you get closer to retirement... say 10 years out? Are you concerned about unexpectedly huge future tax burdens as Uncle Sam tries to accomodate all us retiring Boomers and, if so, wouldn't Roth's help there?