Thanks for the suggestion. I'll make sure to address that topic in one of our monthly newsletters later this year.

Will I be a big fan of Roth 401(k)? Unless you're in one of the lowest tax brackets, my initial reaction is to say no. My philosophy is generally to do what you can to save taxes today, and try to wisely invest the taxes you saved. Who knows what the tax system will be like when you retire or pass your assets to the next generation.

Thanks again for the suggestion.

Zip Code: cpa@mdtaxes.com

While I generally suggest that clients enroll in qualified plans for a number of reasons, they must be aware of the pitfalls.

First and foremost a retirement plan does NOT PROVIDE an income tax deduction, only a tax deferral. Therefore, if income tax rates rise or if a client will be earning more in the future than today, they might end up giving all of the tax "savings" back.

Growth that might be taxed as Capital Gains are taxed as ordinary income in a pension plan. Additionally, no capital losses are permitted.

Extremely limited access to monies prior to age 59 1/2 without substantial penalty or taking a "loan" from their account(s).

A Roth 401(k) or Roth 403(b) could be just the answer that we are all looking for - the ability to save and invest, have protection from creditors, have access to our monies and not have to worry about paying taxes on our gains in the future.

Larry

Zip Code: lkeller@physicianfinancialservices.com

For a different viewpoint from an ERISA expert, see article: The Roth 401(k): "A Hidden Wealth-Transfer Treasure for High Income Taxpayers" - June 13, 2005 at www.roth401kinfo.com.

Zip Code: bmilberg@erisaexpertise.com

I guess the only way you can definately lose is by opting not to contribute to either the new Roth 401k or the traditional 401k. The 401k plan is one of the best financial opportunities available to people during their working years.

Whether you chose to save taxes today with the traditional 401k plan, or to forego a tax savings today in anticipation of tax-free growth and other benefits of a Roth 401k, will be the tough decision.

Zip Code: cpa@mdtaxes.com

Here is some excellent information and analysis about the Roth 401(k): http://www.roth401k-center.com

Zip Code: nospam@jamiesmith.com

More Information

Roth 401k Forum - Discuss the Roth 401k

Zip Code: roth401k@gmail.com

REFERENCE THE 403B/ROTH. THIS NEW PROGRAM IS WHAT MY DAUGHTER WANTS TO INVEST IN THROUGH HER EMPLOYER, THE NEW YORK STATE RETIREMENT FOR TEACHERS. WE ARE HAVING TROUBLE FINDING A INVESTMENT COMPANYTHAT WILL OFFER THIS PROGRAM TO TEACHERS. SHE WORKS IN THE WESTHILL SCHOOL DISTRICT IN SYRACUSE NEW YORK. NO ONE SEEMS TO KNOW ABOUT THIS IN HER SCHOOL DISTRICT EITHER. CAN YOU OFFER ANY SUGGESTIONS ? THANK YOU

Zip Code: COPPERSKIN@MSN.COM