[Anonymous]

Does anyone know the answer to this?

[Anonymous]

@rupert: I also have a Roth, and I think it's a matter of making hay while the sun shines. I don't expect tax rates to go DOWN later in life, do you?

Though it is quite tempting to be able to claim my contributions as tax deductions now, I'm sticking with the Roth. 60 something me will thank 30 something me… I think.

[Anonymous]

@rupert – for me, the biggest positive is that in a Roth earnings are withdrawn tax free too – not just your contributions.

[mla1169]

Rupert, if someone is fairly early on in their career its a good move to pay the tax now. If your tax rate now is 25% and you anticipate it will go up as you progress in your career and that it might even be a higher rate at retirement, now is the time to pay the tax on your retirement.

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Massachusetts CPA (non reporting) since 3/12.

[neoptolemus412]

To the OP's question, no Roth 401K option. Only a traditional option. The match & additional contribution plan for partnership retirement has been mentioned. Options aren't great, but this is true of most big 4 firms. Taking into account attrition of over 60%-80% of employees within their first 5 years of employment, no reason to have a great 401K plan if employees are going to walk out the door early anyway. The big take away is at least they offer some type of match. Overall, industry will have much better retirement options.

[Anonymous]

I actually just re-read the new employee benefits form from PwC since I am starting in a week and in it said:

Save on either a pre-tax OR after-tax basis, or a combination of the two. Pre-tax savings are deducted from your salary before federal and state taxable income and related withholdings are computed. By saving with pre-tax dollars, you defer paying taxes on this money until it is paid out to you from the Plan (e.g., at retirement or termination of employment). As a result, you have an opportunity to invest funds that otherwise would have been subject to taxes.

So it looks like the Roth option IS available.

[neoptolemus412]

CPjAson – your post is inaccurate. PwC's plan allows you to save after-tax dollars, but it is not a Roth vehicle. You are essentially funding a defined contribution plan with after-tax dollars. As such, gains are taxed upon withdrawal. In a Roth, gains are non-taxable upon withdrawal. This is why a Roth is so attractive for younger investors.

“You do not again pay income taxes on post-tax contributions when these contributions are paid to you from the Plan, but any investment gains are taxed and any losses reduce the amount that is paid.”

[Anonymous]

@neo I'm not really understanding your post. Isn't funding a retirement account with after tax dollars the entire purpose of a Roth 401k? Pay taxes now while you're in a lower tax bracket, withdraw tax free.

[Anonymous]

Wow interesting- just did a little research to figure out the difference. I guess I had always just simplified the two as before tax= traditional and after tax= roth.

https://www.money-zine.com/financial-planning/retirement/comparing-401k-contributions/

[Author]

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