Originally Posted by
gloopy
Plus profit sharing, which you can choose to allocate to your 401 I believe. While that's harder to predict (and may go way down or away entirely) so far its been quite nice. 8% this year, I think 6% the year before that, etc.
You are correct. You can have anywhere from 0%-100% of the profit sharing put directly into your 401k. I did 100% last year to avoid the taxes on the bonus which tend to be higher than your tax bracket. Bonus money seems to be taxed at roughly 30-40 % which you can recoup some of that on year end taxes.
I have recently flown with several guys who are only contributing to the ROTH 401K (after taxes) because they hit the IRS limit by September. May as well keep putting money in year round but when you make 250k and the company contributes 15% the company is alone putting away 37500 per year toward your IRS limit of 52k. May as well put the 14.5 into a ROTH 401K
. Unfortunately, I do not have this same dilemma.