roth401k

Discussion in 'UPS Discussions' started by kingOFchester, Apr 24, 2012.

  1. kingOFchester

    kingOFchester Well-Known Member

    Saw this in another thread.

    Where can I get info on the Roth401k? I have the 401k prudential, but don't see an option for the roth401k. Thanks for the help.
     
  2. Brownslave688

    Brownslave688 You want a toe? I can get you a toe.

    Go to change your contribution rate change traditional 401k to zero and Roth 401k to whatever u want. If you keep the rate the same you will put the same amount into it but u will bring home less. Also your statement is kind of confusing because it's just an overall statement and doesn't split them up.
     
  3. UpstateNYUPSer

    UpstateNYUPSer Very proud grandfather.

    With a traditional 401k, which is pre-tax money, when you increase the % that you contribute you can increase the number of withholdings on your W-4 to keep your take-home pay the same or close to what it is now. Keep in mind that the amount that you contribute comes right off of the top of your gross income for tax purposes so you don't need to have as much withheld throughout the year. With a Roth 401k, which is after-tax money, there is no tax benefit (now) so you would not change your W-4. The tax benefit comes in when you start withdrawing from the Roth as withdrawals are tax-free (for now---don't be surprised if the govt doesn't change this)
     
  4. brownmonster

    brownmonster Man of Great Wisdom

    I still don't understand why you change withholding when you increased your contributions. Automatic adjustment based on taxable income.
     
  5. UpstateNYUPSer

    UpstateNYUPSer Very proud grandfather.

    Keeps my take home pay the same which lets me keep more of my money rather than getting a big refund.
     
  6. brownmonster

    brownmonster Man of Great Wisdom

    Gotcha.
     
  7. brownmonster

    brownmonster Man of Great Wisdom

    You must clear about 600 a week with your new plan.
     
  8. UpstateNYUPSer

    UpstateNYUPSer Very proud grandfather.

    $650--this includes $50 UW contribution per week so it would be $700. 35% to 401k. Refund should be around $2K.
     
  9. Logb17

    Logb17 Member

    That is a lot of eggs in one basket
     
  10. Brownslave688

    Brownslave688 You want a toe? I can get you a toe.

    35% either u don't make that much or u max out early? That's nuts.
     
  11. Logb17

    Logb17 Member

    max out?? I didn't think there was a max on a 401k, maybe Roth401k.
     
  12. Jackburton

    Jackburton Gone Fish'n

    Max for both Roth401k and traditional 401k(pretax) is 17000 for 2012. Any combination of the two can not go over that amount without penalty. If you make 85k (which most drivers should average) setting it to 20% will max you out. If you are intrested in comparing the pros and cons of pretax vs after tax contributions you can google Roth401k vs traditional 401k. Either way you choose I highly recommend that you max it out and forget about it. I personally do 50% in S&P 400, 20 REIT, 10 Russell 2000, and 20 in International. Research your choices depending on the risk you're willing to take and how long before retirement.

    Im in no way an expert in the financial decisions of others, only what I've researched for myself. I'm just letting you know how I've allocated my funds. I'm %15 in Roth and 5% in traditional and an aggressive investor.
     
    Last edited: Apr 24, 2012
  13. Brownslave688

    Brownslave688 You want a toe? I can get you a toe.

    If he is over a certain age not sure what age there is a catch up and I think the max would then be $20,000 but 35% of just $70,000 is still $24,500.
     
  14. Jackburton

    Jackburton Gone Fish'n

    If you're over 50 catchup contributions max is set for 2012 at $22,500.
     
  15. kingOFchester

    kingOFchester Well-Known Member

    If you max out the roth401k, can you still do a roth ira?
     
  16. UpstateNYUPSer

    UpstateNYUPSer Very proud grandfather.

    Why is it nuts? My only debt is my mortgage. I am a FT driver w/7 years left--why shouldn't I max it out?
     
  17. Jackburton

    Jackburton Gone Fish'n

    The way I understand it, yes. When/if you ever decide to do a seperate IRA, the company you decide to go with could answer that question.
     
  18. UpstateNYUPSer

    UpstateNYUPSer Very proud grandfather.

    One is independent of the other.