401k and roth 401k max contribution

Merkle
yolo moon

Go to company page Merkle

yolo moon
Jan 19 6 Comments

Dumb question

The new cap to 401k contribution is $20.5k annual

Does that cover both regular 401k and roth 401k?

Or am I allowed to contribute $20.5k to regular and another $20.5k to roth 401k?

Thanks in advance

Tc $245k no stocks

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 TOP 6 Comments
  • The first one. It's the maximum for total contributions for all 401ks,so you'll have to divvy up how you're contributing up to that $20.5k between both Roth and traditional.
    Jan 19 0
  • $20.5k is max 401k contribution (either traditional or Roth or combined ), you also can invest in IRA upto $6k,open IRA account with fidelity or any broker .
    Jan 19 3
    • Income limit (129,000 if single or $204,000 if married and filing jointly) is only for Roth IRA, no income limit for Traditional IRA, deduction limit depends on wage level
      Jan 19
    • If you make a non deductible contribution to a traditional IRA, you still have to pay regular income taxes on the gains at withdrawal...so does that ever make sense to do? I get that those taxes are deferred, but the LT cap gains rate is lower (if you kept the $ outside the IRA and just did buy and hold.....)
      Jan 19
  • Qualcomm / Eng
    oRXf54

    Go to company page Qualcomm Eng

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    Viasat Inc.
     oRXf54
    No it's 20.5k to split between the two however you like. You could also do after tax and convert that to Roth (mega backdoor).
    Jan 19 0