Grease Gun
TB Lurker
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I would like to see if we can get the company to offer a ROTH 401K. I know that the plan is available IF an employer wants to go through whatever costs would be associated with it's implementation. As we try to save for the future the ROTH 401K does have some unique advantages. Especially to those that have a considerable amount of time to contribute. As I am likely to retire in 10-12 years I doubt that I would even contribute more POST tax money at this point. I do however have a regular ROTH as does my wife. For those who are able to contribute at a reasonable post tax rate and have the means to do so the benefits will be great down the line. Just the idea that you can save money, invest it, and never again have to pay taxes on those monies OR the accumulated dividends and capital gains is incredible. How the Congress let this one get passed I'll never know.
For example (this is from an American Funds Annual report)
If one had $10,000.00 invested in the S&P 500 as of Aug 1978 and left it there with reinvested dividends it would have been worth $335,199.00 as of Dec 31, 2006
Now if that was in a Pre Tax (taxable when withdrawn account) as ones regular 401K is.....it will all be taxed as you withdraw it. All $335,199.00 of it.
Consider the ROTH....You would have paid taxes already on your earnings before you contributed the original $10,000.00. The remaining monies (a result of the long term growth and dividends over 28 years) would never be taxed... NO taxes whatsoever on the balance. $325,199.00 you get to take out TAX Free.
The opportunity is great if you start young. OR if you believe as I do that taxes will likely be higher in the future with all of us old-timers on SS and Medicare.
Wikipedia has a pretty good page on the ROTH 401K Roth 401(k - Wikipedia, the free encyclopedia)
If enough of us at National and Freight ask our HR people to work on this maybe someday we will have this option.
For example (this is from an American Funds Annual report)
If one had $10,000.00 invested in the S&P 500 as of Aug 1978 and left it there with reinvested dividends it would have been worth $335,199.00 as of Dec 31, 2006
Now if that was in a Pre Tax (taxable when withdrawn account) as ones regular 401K is.....it will all be taxed as you withdraw it. All $335,199.00 of it.
Consider the ROTH....You would have paid taxes already on your earnings before you contributed the original $10,000.00. The remaining monies (a result of the long term growth and dividends over 28 years) would never be taxed... NO taxes whatsoever on the balance. $325,199.00 you get to take out TAX Free.
The opportunity is great if you start young. OR if you believe as I do that taxes will likely be higher in the future with all of us old-timers on SS and Medicare.
Wikipedia has a pretty good page on the ROTH 401K Roth 401(k - Wikipedia, the free encyclopedia)
If enough of us at National and Freight ask our HR people to work on this maybe someday we will have this option.