Please help me work out some math/deep thinking. I am trying to decide whether to max 457(b) or instead invest in a post-tax account and am having trouble deciding.
I currently max out my 457(b), 401, and Roth IRA. My federal tax rate after all allowed deductions/credits, is 8-9%. I am 9 years from FIRE. Over 70% of my equities are in 401/Trad IRA. Approximately 10% are in Roth. 20% are in 457(b). The 457(b) will be accessible to me at FIRE, distributed as ordinary income. I will need to survive 7-8 years before hitting 59 ½.
I can’t figure out how to decide whether from a tax perspective it is more efficient to continue fully funding the 457 (ordinary income withdrawals), or use the same money to invest post-tax, with the increase taxed at capital gains rate. My low tax rate will increase without the fully funded 457(b). I’m assuming from 9 to 14%, which is a WAG. Many of you are smart and mathy and fabulous – suggestions are appreciated.