Author Topic: No 40k at work - go with Roth IRA or Roth 401k to start saving?  (Read 1189 times)

mousebandit

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We're getting closer to our debt payoff date - September 15th!  And starting to focus more on the savings now.  I got the husband's HSA set up today.  His company has been through a couple of buyouts in the last 6 months, and the latest one killed off their 401k and pension plan.  It will be at least fall before they get something new set up, and it probably won't have any match or profit-sharing. 

We won't be able to max out a 401k this year, but we will have hopefully about $6k to save (plus more for his HSA), maybe more, depending on the job contracts. 

We intend to max out his individual HSA, so that will be just over $3k. 

SHould we go for a Roth 401k to put everything else into, or a Roth IRA?  Or split between both for the remainder of this year?  And for my furthering education - WHY? 

THANKS!
MouseBandit



seattlecyclone

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Re: No 40k at work - go with Roth IRA or Roth 401k to start saving?
« Reply #1 on: June 07, 2016, 10:22:51 PM »
I'm confused. Either they canceled the 401(k) or they didn't. If they canceled it, the choice is easy: go with the IRA.

mousebandit

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Re: No 40k at work - go with Roth IRA or Roth 401k to start saving?
« Reply #2 on: June 07, 2016, 10:33:52 PM »
the employer went through a buyout.  The buyout cancelled all retirement plans.  They will eventually set up a new one, but that is months away. 

In the meantime, we want to start saving.  It's my understanding we can set up our own Roth401k, similar to a Roth IRA.  Or, just set up a Rota IRA. 

Wondering if we should do just one or the other,  or both?  Especially considering that we will have less than $10k, maybe a Lot less, to invest this year.

Or maybe I completely misunderstood, and there is no such thing as aRoth 401k?

Physicsteacher

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Re: No 40k at work - go with Roth IRA or Roth 401k to start saving?
« Reply #3 on: June 07, 2016, 11:11:17 PM »
There is such a thing as a Roth 401k, but it is offered through an employer in the same way a traditional 401k is. Unless you are self employed, which opens the door to more options, your choices are a traditional IRA or a Roth IRA, subject to the relevant income limitations. If you are looking at investing $10k, opening an IRA for each of you will provide plenty of tax advantaged space for this year's investments.

mousebandit

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Re: No 40k at work - go with Roth IRA or Roth 401k to start saving?
« Reply #4 on: June 08, 2016, 12:31:10 AM »
Ah, that's it!  I get it now.  THANKS!! 

MouseBandit