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Roth ira is not a roth 401k Ive never been able to figure out why personal finance sites and gurus conflate that, I can find no advantage of a roth ira it look
by vmception 5y ago
Roth ira is not a roth 401k
Ive never been able to figure out why personal finance sites and gurus conflate that, I can find no advantage of a roth ira it looks simply like an inferior product/provision
- wikibob 5y agoOverall I would agree that Roth dollars are preferable to traditional-IRA and traditional-401k dollars. However until very recently it was not possible to get money into Roth funds if you made over the income limit. It’s been a multi-decade accumulation of small changes culminating with the 2018 change that allows converting post-tax dollars from IRA or 401k dollars to Roth dollars, with no income limit.
- vmception 5y agoOkay So a roth 401k is still not a roth ira, thats my only point and am hoping for a conversation why people act like there is only one roth product and that they are the same thing when one is clearly superior in most circumstances
- leetcrew 5y agoI agree, it's an important distinction that should be made more clear. one advantage to a roth (or traditional) IRA over a 401k is that you get to choose the funds yourself. my employer doesn't offer very good funds (the expense ratio on the s&p500 option is over 50 basis points!), so I max out my roth IRA before contributing to my 401k.
- vmception 5y agoA self directed 401k allows that too just like a self directed ira. 401k is still superior then. Roth or otherwise you can “mega backdoor roth” into self directed 401ks