If you have the option to invest in both a traditional 401(k) and Roth 401(k) at work, here’s how to decide which account is better for you.
Most workers are familiar with the benefits of a traditional 401(k):
- It is a retirement savings and investment account in which workers can sock away a percentage of their earnings pre-tax
- Contributions lower their taxable income for the year
- Over time, workers can build their retirement savings through years of contributions and compound interest from their investments