Comparisons between Roth IRA, Roth 401k and Old Traditional 401k Retirement Plans

Effective January 1st, 2006, employers now have the ability to combine the retirement options provided by traditional 401k retirement plans and Roth IRA plans into one effective plan, called simply, the Roth 401k. The Roth 401k is essentially similar to the traditional 401k and Roth IRA plans but differs in some ways as well. Below, …

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Differences between 401k Pre-Tax Contributions & After-Tax Contributions

Pre-tax contribution is the amount of deductions you make from your monthly gross wage into your 401k retirement savings account, BEFORE taxes have been deducted. By making pre-tax contributions, you are lowering your current taxable income. For example, if you earn $10,000 per month, and contribute 10% of it towards a 401k retirement savings account, …

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Effects of the Pension Protection Act of 2006 on Lump Sum 401k Distributions

Rather than receiving a monthly check upon retirement (annuity payments), many people think of taking out a lump sum distribution (a one time distribution) of their retirement assets. If you do decide to take out a lump sum distribution of your 401k assets, consider the Pension Protection Act of 2006 which could severely reduce the …

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