My wife and I have been max contributing to 401k consistently for the last 15-20 years. We are evaluating whether to stay the course or start contributing to Roth-401k going forward. Need some advice from this community. We have plans to settle down in India after retirement in about 15 years. For a family that wants to settle down outside the US after retirement, does it makes sense to put money in Roth 401k or keep doing the traditional 401k, considering current and future US tax rate projections and India CoL projections, given our situation below: 1. Combined TC = 750k/year 2. MCoL 3. Years to retirement = 15 4. US citizens 4. Want to settle in India. Currently, we own properties in Chennai India.
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I heard one thing, you can keep your 401k account here and can move to India, after age 59.5 you can reap the benefits of it by withdrawing money and transferring back to India. Talk with Charles schwab once, I am pretty sure you can.
Wow. What is your combined retirement accounts balance?
If you don't need money now, better to let it grow in 401k and Roth. That's regardless of where you live. Also remember that us dollar Indian rupee exchange rate will only go in one direction
This made me think about required minimum distributions (RMDs) - given your TC and contribution history, minimizing RMDs will likely be a consideration for you. I’d check if Roth IRAs are actually not subject to RMDs (link says they’re not) and what stops you from rolling your Roth 401k plan into a Roth IRA. “RMD rules do not apply to Roth IRAs while the owner is alive.” https://www.irs.gov/retirement-plans/retirement-plans-faqs-regarding-required-minimum-distributions#1
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