converting 401k to Roth

[Chad J Muse]

Researching 401 to roth. Is there any way to do without paying an absorbent amount of taxes?

[Steve Vaughan]

Originally posted by @Andre Debs:

Originally posted by @Steve Vaughan:

Originally posted by @Andre Debs:

Originally posted by @Steve Vaughan:

 Unless you are in the highest of high tax brackets, I'd contribute to the Roth 401 only.  Depending on your age, 90% of your 401 at retirement could be taxable growth.  I want as much as possible completely tax free with no RMD requirements at 70 1/2.

Employer match has to be in a regular 401, but that's all that would be in mine.  I'd convert to a Roth 401 strategically,  depending on my income for that year and the market.  Convert on down years.

According to the IRS website, if I'm reading it correctly, Roth 401K's do require RMD's upon reaching 70 1/2 but they then can be rolled over into a Roth IRA which has no RMD requirement and until death. Correct me if I'm wrong in my understanding.

https://www.irs.gov/retirement-plans/retirement-plans-faqs-regarding-required-minimum-distributions

As to investing in the Roth solely, I’ve actually thought about doing it but I see some benefit to having both a regular 401K and a Roth 401K, namely, hedging against taxes. Whether my tax bracket goes up and down, I should be safeguarded. Plus, I do get to deduct the traditional 401K contributions which helps me being on the cusp of the next bracket. 

 Gotcha. Glad you are well-informed.  Being on the cusp of a higher bracket would def influence my regular 401 contribution vs Roth 401 decision. I just keep in mind growth. If I have 30 years, I'll pay a few extra grand in taxes now to avoid paying on a couple mil later.

As far as no RMD goes, yes, I'd assumed one would transfer to a Roth IRA. No need to stay in a 401 after retiring. Cheers!