The Mega Backdoor Roth 401(k) is available within your Nike 401(k) plan. It allows you to contribute after-tax dollars and automatically convert those dollars to Roth.

The Mega Backdoor Roth is way for high-income earners way to utilize the benefits of a Roth. Within a Roth your money grows tax-free. These same dollars and the interest earned are tax-free when accessed in retirement (59.5+ years old).

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Third Party:
Avier Wealth Advisors is not affiliated with Nike. There is no guarantee that the information we have provided is accurate. Nike employees are encouraged to contact their employer should they have any questions regarding their employee benefits.

Taxes: Avier Wealth Advisors does not prepare taxes. The tax ideas presented are meant to demonstrate general concepts rather than precise calculations. We consult with your tax professional for exact calculations.

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Nike Mega Backdoor Roth / Nike 401(k): Invest in Your Future Self

When it comes to planning for retirement, it’s never too early to start. With the Nike Mega Backdoor Roth and the Nike 401(k) plans, employees have access to powerful tools to secure their financial future.

The Mega Backdoor Roth is a lesser-known strategy that allows employees to contribute more than the traditional limit to their Roth IRA. While a regular Roth IRA has an annual contribution limit of $6,000 (for individuals under 50 years old) or $7,000 (for those above 50), the Mega Backdoor Roth enables Nike employees to contribute significantly more.

The Mega Backdoor Roth takes advantage of the IRS’s contribution limits for 401(k) plans. At Nike, employees can contribute up to $19,500 to their 401(k) in 2021 ($26,000 for individuals over 50). However, the Mega Backdoor Roth allows for additional after-tax contributions, which can then be rolled over into a Roth IRA.

Here’s how it works: Once an employee reaches the contribution limit for their 401(k), they have the option to make after-tax contributions to their plan. These contributions are often subject to income tax, but the Mega Backdoor Roth permits employees to convert these after-tax dollars into a Roth IRA where they can grow tax-free.

The benefits of the Mega Backdoor Roth are significant. First, contributions to a Roth IRA are made with after-tax dollars, which means no taxes are owed upon withdrawal in retirement. Additionally, any gains made within the Roth IRA are also tax-free, providing a powerful tax advantage in the long term.

Another advantage of the Mega Backdoor Roth is the ability to increase retirement savings significantly. By making additional after-tax contributions to their 401(k) and then rolling them into a Roth IRA, employees can save well beyond the traditional annual contribution limit, supercharging their retirement nest egg.

But the Mega Backdoor Roth isn’t the only tool in Nike employees’ arsenal. The Nike 401(k) plan also offers numerous benefits. Through this plan, employees can save for retirement by contributing a portion of their pre-tax income. Unlike the Mega Backdoor Roth, contributions to a traditional 401(k) are made with pre-tax dollars, meaning employees may lower their taxable income and achieve immediate tax savings.

Furthermore, Nike offers a generous matching program for employees enrolled in the 401(k) plan. The company matches contributions up to a certain percentage, effectively giving employees free money towards their retirement goals.

In summary, the Nike Mega Backdoor Roth and Nike 401(k) plans provide employees with valuable tools to invest in their future selves. By taking advantage of these plans, Nike employees can maximize their retirement savings, lower their tax burdens, and secure a comfortable financial future. It’s never too early to start planning for retirement, and Nike is equipping its employees with the means to do just that.