Team members team 6
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Team Members Team 6 PowerPoint PPT Presentation


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Team Members Team 6. James Ayoub Michael Pan Melissa Sy James Traylor. 401K vs. Roth IRA. Introduction Project Outline Results Conclusion. 401K Tax-Deductible Contribution limit is $15,500 Withdrawals are fully Taxable. Roth Ira Non Tax-Deductible Contribution limit is $5000

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Team Members Team 6

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Team members team 6

Team MembersTeam 6

James Ayoub

Michael Pan

Melissa Sy

James Traylor


401k vs roth ira

401K vs. Roth IRA

  • Introduction

  • Project Outline

  • Results

  • Conclusion


401k vs roth ira1

401K

Tax-Deductible

Contribution limit is $15,500

Withdrawals are fully Taxable

Roth Ira

Non Tax-Deductible

Contribution limit is $5000

Tax-free Withdrawals

401K vs. Roth IRA


Assumptions made

Assumptions Made

  • Equal contributions to both plans

  • Roth IRA ineligibility ignored

  • Flat tax (not tiered)

  • Annual salary raises kept up with inflation at 3%

  • ROR is 10%

  • No 401K matching from employer

  • No Social Security Benefits

  • No investment fees

  • 35 working years


Subject

Subject

  • 25 year old Engineer

  • Starting Salary: $50,000

  • Male

  • Secret identity: Clark Kent

  • Allergic to Kryptonite

  • Favorite Colors: Red & Blue


Results

Results


Conclusion

Conclusion

From our default assumptions our analysis concludes that the 401K is a better plan than the ROTH IRA.


Resources

Resources

  • www.moneychimp.com

    (great for tax rates)

  • www.mutualfundsabout.com

    (Contribution limits to retirement plans)

  • www.fool.com

    (general information on plans)


Questions

Questions?


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