Roth or 401k for young worker?

Agree, except that I would prioritize Roth past the 24% bracket. Focus on getting your Roth balance high as young as possible to reap the reward of many tax free years on the growth of your investments.

Personally, this is a mistake I made and would handle differently if I had a do-over. I prioritized the current year deductions too much.

401K if there is a company match, then do a Roth. Ultimately, she needs to have some money in tax deferred accounts like traditional 401K and IRA and some in Roth accounts to have the maximum flexibility in the future.

401k until company match. After that prioritize Roth IRA. Then anything additional put in 401k if you can swing it.

quote:

---

Contribute up to the match and then Roth IRA then brokerage if any money left over after setting up your emergency fund

---

Knowing what I know today, I would not put much emphasis on an emergency fund. Savings should be treated like insurance. It doesn't build wealth. When I was starting out there were high account minimums and other barriers and a lot of ignorance about investing, but now you have a lot of options that require a minimal investment. Through all the market cycles I have lived through, I would have been much better off if I could have just routinely put money into an index fund. Some shares would have gone up and some would have gone down but overall I'd have a lot more wealth.

Piggy backing on this.

Starting with new employer, they offer 401K and Roth 401K options. Trying to decide which way to go. They offer a match.

I am 22% tax bracket and doubt I get to the next bracket.

Wife contributes to 401K, and has Roth IRA with Vanguard.

I have a traditional IRA and Roth IRA with Vanguard. We have been maxing both the Roth IRA the last few years.

Both in our 50s.

Almost all 401k plans have a pre-tax option and a Roth option. Contribute to the Roth option within the 401k up to the company match, assuming there is one. Then max out a Roth IRA. Next, max out an HSA assuming she has the option of a high deductible health insurance option. Then you can go back and max out the 401k.

Look up about the order of operations for savings for more details.

401 k to the max company will match.

Then Roth

I just do half to Roth 401k and half to the pre tax 401k because I’m not smart enough to figure it out. Company matches 50% up to the max so I max it that way.

Roth till maxed out