Pre-tax 401(k) or after-tax...thoughts?
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Depends on your current tax bracket vs expected tax rate upon retirement.
You’re mixing and matching.
Pre-tax = traditional. Pre-tax money and tax free growth, with taxes at withdrawal
Post-tax = Roth. Post-tax money and tax free growth. No tax at withdrawal.
These are mixable up to 19.5k. Your employer matches this, and match is traditional.
After-tax = after-tax. Post tax money up to your company’s limit. Tax free growth and tax at withdrawal. But, you can roll it into a Roth IRA and turn it into a tax free withdrawal, too.
Personally, I do as much tax free growth and withdrawal as possible. Taxes always goes up and the market always goes up. Even with high taxes now, it’s still worth it to me.
Pass unless there is a match.
Wrong
The theory behind pre-tax is that your income and tax rate will be much lower when you start withdrawals than your tax rate now.
So, the real question is "do you trust your government won't jack up the tax rates in however many years it is to when you retire?"
I feel the same. Roth all the way
what's the max contribution for after tax?
also important here, alongside the comment "tax bracket now vs retirement": the post tax account can be converted into a Roth IRA without triggering a tax event. I do this once a year and get about $37k / year in for retirement between 401k + match, Roth IRA, and the triple tax benefit HSA.
Accenture's plan offers megabackdoor Roth IRA rollovers. You can call the 401k team and they'll walk you thru how to do it online right thru Hewitt website. Super easy and the EY tax service knows how to handle the tax implications from the special 1099 form they send at the end of the year.
Know there is an important distinction between after-tax and Roth. Do Roth first.
https://www.google.com/amp/s/www.kiplinger.com/article/retirement/t001-c032-s014-a-401-k-may-be-worst-account-to-have-in-retirement.html%3famp
The answer to all of these is Roth contributions and rolling to an IRA (may have to wait until you don’t work there if in-service withdrawals aren’t allowed).
https://www.google.com/amp/s/www.cnbc.com/amp/2016/10/26/self-made-millionaire-dont-put-money-in-your-401k.html
Worst advice I’ve ever heard. It’s dangerous and irresponsible for 99% of people. I’ve listened to this guy and though he’s successful, he’s not a sophisticated investor at all. Counter to his advice, most people do in fact save their way to retirement prosperity vs putting it all on black at the roulette table.