This is an option at H's work. We will likely accidentally do it this year as H's bonus gets put into the 401K at the usual percentage, making exact calculations impossible. So we started doing rsome reading on whether we should try to overshoot or undershoot the annual contribution limit.
Everything I google is confusing, made more so by the fact that info about Roth 401k's is often mixed interchangably with after tax 401k's.
From what I can tell, though, whatever we put in the after tax 401k, we can put the contributions directly into a Roth IRA if/when he leaves the company, and any interest earnings can be rolled into the regular IRA with the rest of the 401k balance.
That seems fairly straightforward, but I am wondering how much of an accounting nightmare if will be to separate the money out. The account is with Fidelity if that matters.
One possibility is to try to throw a ton of money in the after tax 401k as he plans to leave this employer in the next year or so. So we could effectively dump a ton of money in his Roth IRA pretty quickly. But that would mean less in our taxable brokerage account (intended for medium term purchases like house DP, replacement car, and then eventually ER).
If you have this option, talk me through your choices. If you have a brilliant understanding of this option, can you correct any misconceptions that I have?