Roth 401(k) vs. 401(k): Which is the Better Option? – Of Dollars And Data

Given that the timing of taxes is the most important thing when deciding between a traditional 401(k) and a Roth 401(k), we can reduce this problem down to answering a single question:

Will your income tax rate be higher now (while working) or later (in retirement)?

All else equal, if you think your income taxes will be higher now, then contribute to a traditional 401(k), otherwise contribute to a Roth 401(k). 


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