The 7 Most Sought After Good Habits (and How to Achieve Them)
I didn't necessarily say to split them, some people can max out both contributions. it's a bet on tax rates. two things affect the payout: your post-retirement income tax bracket and tax rates in general. for most folks, your retirement income is likely to be lower than your main earning years, and very likely will put you in a lower tax bracket based on today's structure. so in 30-50 years, do you believe that taxes will go up, do down, or stay the same for the level of income you'll see from retirement accounts at that point? if tax now is greater than tax later, then traditional 401 and ira make sense. if tax later is greater than tax now, then roth makes sense. splitting the approaches down the middle hedges your bet; less upside and less downside. I preface this by saying that I do not hold a FINRA designation/series license and any advice or explanation given should be confirmed or consulted with in a situation by your financial adviser The Roth IRA is is different.
• Habits of a Happy Life