Anyone doing the Roth 401k option?

[pretender]

Chances are the teamster pension will be in big trouble by the time you can retire from UPS and collect a check. SO DO NOT COUNT ON THE TEAMSTER PENSION BEING COMPLETELY THERE IN 25 to 30 YEARS?

If the Teamster pension is still around in 30 years it will be paying out much lower monthly amounts per Teamster member. SO YOU WILL BE IN A LOWER TAX BRACKET IN RETIREMENT UNLESS YOUR WIFE IS A DOC OR CEO?

I would take the tax break now in the UPS/Teamster traditional 401k and do a Roth outside of the 401k with Fidelity or Vanguard or Scott trade,etc.

There isn't a right or wrong answer. But doing both the traditional 401k and a Roth is a win win.

Its part of a bucket strategy for retirement saving. Google it and you can find lots of great info.

The fact that you are saving at 35 is awesome. I know way too many Teamsters that aren't saving in the 401k at all. I just don't get it?

There is a right wing movement in this country to destroy all the unions and pensions and most Americans just don't seem to care?

We will have to agree to disagree about the right wing movement, but I love the bucket strategy.

 

[pretender]

Given the fact that you are much closer to retirement than I am the argument for the Roth becomes less relevant. Having a solid plan period is better than no plan which is what most of my older co-workers have now. I see the results of that with my parents who did very little retirement planning up until recently. Personally I don't want to be in that boat and with time on my side I don't believe I will.

I agree about having a solid plan--Plan for the worst and hope for the best, and you will be ahead of most people...

 

[pretender]

I see the same in my center. Guys want their toys and think that our pension will be enough.

You may be able to withdraw from your 401k earlier than 59--- it's called the Rule of 72.


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It is nice to have the option of using the Rule of 72, but ideally it should be avoided. I have the same plan as you--live off my pension and let the IRA and SS grow...

 

[HEFFERNAN]

Brett, wouldn't it make more sense to compound interest on one larger balance as opposed to two smaller ones?

There is no way to combine the two while you are still working.


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If you are using this math, then the traditional 401k would compound the most interest as it is being given more money at inception. The Roth would be inhibited by tax from the get go.

 

[UpstateNYUPSer(Ret)]

If you are using this math, then the traditional 401k would compound the most interest as it is being given more money at inception. The Roth would be inhibited by tax from the get go.

This is only true with Roth IRA's----the Roth 401k has the same contribution limits as the traditional ($17.5K), along with the same catch-up contribution ($5.5K).

 

[IVE GOTTA PACKAGE 4U]

It is nice to have the option of using the Rule of 72, but ideally it should be avoided. I have the same plan as you--live off my pension and let the IRA and SS grow...

Its rule 72t....you may withdrawl from your 401k plan...If you are atleast 55 years or older and seperated from your employer. You must also take out equal installments over a 5 year period. you can not change it, once you start it...or you will have to pay the 10% penalty!

 

[pretender]

Its rule 72t....you may withdrawl from your 401k plan...If you are atleast 55 years or older and seperated from your employer. You must also take out equal installments over a 5 year period. you can not change it, once you start it...or you will have to pay the 10% penalty!

That's right--Thanks for the clarification.