re: .

Roth account is not separate in his example.

You can choose a Roth 401k or Traditional 401k.

Roth 401k you pay tax now and it is tax free later.
ex. salary 50k you save 5% so you save $2500 for the year. It is taxed $625 in the 25 percent tax bracket.
Later when you withdraw whatever amount it is tax free after 59 1/2 years old.

Traditional 401k you don't pay tax now it is deferred.
When you withdraw it is taxed as income.
So it you make 35k from soc security and you take out 5k from trad 401k you are taxed on 40k net income.