Hi all,
Simple question regarding Roth vs Traditional elections. My wife and I (24 & 26, respectively) combine to make ~135K, split basically even between us. We contribute 10-12% of our income to our 401k/403b and max out our IRAs each year. We both have the ability through work to elect a before or after-tax election for our 401k & 403b.
I have a good feeling that in retirement we'll be in a lower tax bracket than we are currently as we won't be making our current level of income. However, would it still be better to make Roth/Before tax elections for our 401k/403b & IRA accounts? If anything, tax rates will probably rise, and while in 35 years the Gov could theoretically tax Roth accounts, I don't see them able to pass that legislation. Or, should we hedge our bets and make Roth IRA contributions while going before-tax with one 401k and after-tax with the 403b? That way, we can have more control over our income streams down the line due to ability to pull from before & after tax account.
In summary - 135K income, mid-20s, how should we make elections for IRAs and work retirement accounts?
Thanks in advance for any assistance!