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401K catch-up contributions?
Old 10-12-2006, 06:53 PM   #1
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401K catch-up contributions?

There was an earlier thread concerning after tax contributions to a 401K and the majority opinion was negative. I am currently making catch-up contributions to my plan since I am in my 50th year. I did not want to hijack that thread so I thought I would start a new one.

Are catch up contributions treated as after tax contributions? So far is looks like everything is being reported on the same line.

Thanks for any help,

JP

Only 4 years, 11 months and 18 days to go... but who's counting
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Re: 401K catch-up contributions?
Old 10-12-2006, 07:11 PM   #2
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Re: 401K catch-up contributions?

Nope, they are pre-tax.

So, for 2006 if you are 50 or over this year, you can put in up to $20,000 pretax.
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Re: 401K catch-up contributions?
Old 10-12-2006, 07:35 PM   #3
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Re: 401K catch-up contributions?

That's a real nice avatar Martha
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Re: 401K catch-up contributions?
Old 10-12-2006, 08:53 PM   #4
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Re: 401K catch-up contributions?

I've decided not to do the catch up portion of the 401k. I will turn 50 next year. I plan on contributing the catch up on my Roth. The rest is going to my after tax account in I Bonds. I will sell the I Bonds when I retire at 56 and live off them untill I'm 60. At that point I'll start collecting my pension.

The downside to deferring the pension is that I will have to fund my own health insurance until I start to draw the pension. When it gets closer to retirement I'll have to start researching my options. I had an aneurysm and I have a vestibular disorder so I have some pre existing conditions.
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Re: 401K catch-up contributions?
Old 10-12-2006, 10:50 PM   #5
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Re: 401K catch-up contributions?

I turn 50 next year... and will start the catch up in January... I can not put into a Roth, but I don't think I would do it there anyhow as the tax advantage is better than the deferred income..


edit age... duhhhh
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Re: 401K catch-up contributions?
Old 10-13-2006, 06:49 AM   #6
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Re: 401K catch-up contributions?

I started the catch up as soon as I was able, it's the only tax deferred spot for me to park money and I'm considered highly compensated so my contributions can be limited by employee participation, the extra 5k helps a lot.
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Re: 401K catch-up contributions?
Old 10-13-2006, 08:23 AM   #7
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Re: 401K catch-up contributions?

Both hub and I max out with the makeup at 20K. It's great.
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Re: 401K catch-up contributions?
Old 10-13-2006, 03:17 PM   #8
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Re: 401K catch-up contributions?

related ... anyone have a clue what the new max (including catch-up) will be next year?
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Re: 401K catch-up contributions?
Old 10-13-2006, 05:21 PM   #9
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Re: 401K catch-up contributions?

No announcement yet on next year's cap.
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