Originally Posted by
LeineLodge
They are both subject to tax advantages (and contribution limits) of 401k plans per the IRS. I don't think Delta will restrict your ability to retire based on age or years of service.
The limits you will encounter come from the IRS, regarding:
1) how much per year can be contributed-known as the 415c limit, which is $50,000 for 2012 and includes your employee contributions as well as Delta's DC and DPSP contributions on your behalf
2) what age you can begin making catchup contributions (I think it's 50, but I'm one of the "young" guys I don't have to worry about that quite yet
)
3) what age you can begin taking distributions from your tax-advantaged accounts without incurring a penalty. Again, I can't remember off the top of my head what the age is, but you'll probably find the answer faster on the IRS website or by calling ALPA, than calling 800-MYDelta
Leine,
That's good information... To add a couple of points:
1.) There is a maximum individual contribution as well. It's $17,000 but "catch-up contributions" are allowed for those of us 50 and older. Those add an additional $5,500 to the limit making it $22,500.
2.) The Roth account, whether it's a 401K or IRA, grows tax free as well. So you pay the taxes on the money up front but all the growth is tax free.
If you believe (as I do) that taxes will go up. That is something to consider. That feature also allows you to manage your income taxes in that when you start taking withdrawals from your retirement accounts you can adjust (within some limitations) how much you withdraw from your Roth and non-Roth accounts to minimize your tax liability.