Today we will cover the basic differences between the Roth IRA and the Roth 401k but also look at some of the lesser-known differences that could cost you if you don’t know them. If you have been considering the Roth IRA or the Roth 401k let’s make sure you know the differences first.
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Thanks, I have a Roth & I came here because I had questions about direct contributing to my Roth.
I now realize after watching this that my Roth must be a Roth 401k & the reason I hear of people direct contributing outside of there paychecks is because there talking about Roth IRA. I'm guessing that if I open a Roth IRA elsewhere it won't conflict with my contribution limits on my Roth 401k as there two different types of Roth with different set limits if I'm not mistaken? I was confused because I herd that if you have multiple Roth accounts & all them accounts combined go over the set tax limits that you can still get in trouble with the IRS. This is why I was hesitant on the idea of opening another Roth.
should one do BOTH?
I'd add one additional difference is that Roth 401Ks can have very limited investment options compared to a Roth IRA. It may make sense to use a traditional 401K to ensure you fall under the AGI for a Roth IRA contribution to max out your retirement savings and options for the future. This may not make sense for people that can easily use a backdoor Roth without needing to pay taxes to convert any of their other taxable retirement accounts.
I honestly think this video was very important
Excellent video. You broke it down very well.
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Damn good video
Great video. Really cleared up allot of questions
If my Roth 401K is less than 5 years old, will I be penalized for rolling over into a Roth IRA before the 5 year mark? Reason for rolling over would be leaving my current employer, not to take a distribution/withdrawal. I'm still pretty young and do not plan to touch this money for quite some time, so I don't really care that the Roth IRA timeline would start over with the conversion. I just want to make sure that I wont be penalized for rolling over in under 5 years…
If I will be penalized, I have to reevaluate which retirement savings vehicle is best for me at this time. Any insight you have would be greatly appreciated! Thanks
Why is in Roth 401 contribution and gains mixed and not in Roth IRA
Confused at 3:00 with the withdrawal. Why would you have to pay taxes on Roth 401k when taking money out, if you’ve already paid taxes on it?
I heard you can open multiple ROTH IRA accounts so if you have more than $6000 to invest you just put the rest in another ROTH IRA
Hey Dustin enjoy your videos watch them everyday. Have you ever discussed Roth 457 curious what the advantages and disadvantages are and what the contribution limits are. Also have Roth IRA and do they conflict with each other
When using a ROTH 401k can you invest the Roth portion differently than the employer contribution? Like, can my ROTH portion be straight equities and the employer portion be in bonds?
Can withdraw from the 401k at 55 instead of 59.5 if separated from company. If the fees and investing choices are reasonable that is reason enough to leave it there until 59.5. Good stuff
I have a question Dustin, the employer match on the Roth 401k, is it pretax or is it contributed as post tax? So, if you were to roll your whole account out of the Roth 401k, can it all go to a Roth?
The limits placed on IRAs are absolutely ridiculous.
If I want to rollover my ROTH 401k to My ROTH IRA and I have the ROTH IRA account opened for 5 years, once the rollover is successful, Can i take out the money that was initially at ROTH 401k penalty-free? if so, can i take out all of them or can i only take out the contributions I have made to my ROTH 401k in the past ?
Thank you for sharing this not so well known difference between Roth IRA and Roth 401k. This will help people to know what fits them most.
Thanks for the tips Dustin, always on the ball.
Hi Dustin
Holy smokes! I’m 1st?!