And if the $400K is all qualified dividends, it's only a 25.8% federal marginal rate to take a few more thousand out of the $401k.Depends. One example of more than 25M.At what net worth would you consider making ROTH 401k contributions during your working years EVEN in the highest federal tax bracket (37%)? No state tax.
Typically it is advisable to make pre-tax contributions when in the highest tax bracket but there must be a point in net worth where ROTH is more favorable long-term (future tax liability >37% either because rates are increased or the HNW individual never makes it to a low tax bracket due to portfolio income/RMDs/SS.
20M in taxable at 2% = 400k
5M in 401k at 4% = 200k
600k is still within 35% bracket.
Statistics: Posted by FiveK — Sat Jun 08, 2024 4:20 am