Here's how to choose between a traditional 401(k) and a Roth 401(k). (via CNBCMakeIt)
The main difference between the two 401 accounts, experts say, is whether you want to pay taxes now or later. Selecting a traditional 401 will put more money in your pocket now, because you are lowering your taxable income by the amount you're contributing. You're taxed when you take the money out in retirement.
With a Roth 401, you pay taxes upfront, and all of the money in the account is yours, assuming you follow the rest of the withdrawal rules. This is an especially attractive strategy now becauseIt's not whether you should take a Roth over a traditional 401, but what is the right mix of savings to achieve your life and retirement goals.
Typically, early-career workers and those in lower tax brackets are advised to opt for the Roth, while those in higher brackets are advised to invest in a traditional 401, Clayton Alexander, a registered investment advisor and founder of
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