regular Roth vs 401k Roth

[halv45]

age 42, married
2 kids in grade school
I make 68k
my wife make 10k
Fed tax bracket is very low, I think it was 5%
I'll work for another 20 years.

I am putting 5% + 5% match into a 401k Roth and since we just paid off the house, we'll put that payment ($750) into investments.

I was thinking a regular Roth would make more sense since I have more control over the money.

The flipside is once it's in a 401k, it's hard to get out, which is a good thing.

I can buy most ETF's in my 401k. But I can buy anything in the Roth.

Any suggestions?

 

[RunningBum]

Probably depends on what kind of fees you are charged in your 401K Roth. After getting a full match I would probably just do a regular Roth to have full choices and probably lower fund expenses unless you have a good plan. I'm not all that familiar with a 401K Roth though, so I could be missing something.

Not that it really matters in this discussion, but there is no 5% tax bracket. Your effective rate may have been 5%, but you are most likely in the 15% bracket. This would matter more if this was a discussion about a regular 401K vs Roth 401K. The Roth 401K almost certainly was the right call, btw. If you edge into the 25% bracket, you might want to revisit that.

 

[Animorph]

In terms of Roth IRA contributions, you'll be limited to $5,500 or $6,500 depending on your age. Your 401k lets you contribute much more, though you may be able to contribute to both.

If you want to do a rollover, I think all the usual 401k versus IRA arguments still apply.

 

[heeyy_joe]

Always invest enough in 401K to qualify for the match. A separate Roth for part of your money is a good idea too as it gives you lots of withdrawal choices later.