2007-01-10 23:00:02 · 4 answers · asked by bamboo 2 in Business & Finance ➔ Personal Finance
Nuff said look it up.
2007-01-10 23:07:20 · answer #1 · answered by pnybt 4 · 0⤊ 0⤋
A 401K is an employer-sponsored retirement plan that allows the worker to invest his earnings without paying taxes on them. Any gains from the investments are also tax free, and in many cases the employer matches all or part of the worker's contribution, again tax free.
2007-01-10 23:15:06 · answer #2 · answered by njyogibear 7 · 0⤊ 0⤋
A good way to decide between traditional and roth is which tax bracket you will be in when you invest the money and when you disburse the money, since one is taxed up front and the other is taxed when disbursed.
2007-01-11 00:57:39 · answer #3 · answered by adoc1950 1 · 0⤊ 0⤋
401k earnings are NOT tax free, they are tax deffered,there is a big difference, you will pay regular income tax on all of the money when you take it out at retirement
a roth ira grows tax free, but you put money in on an after tax basis
2007-01-11 00:16:28 · answer #4 · answered by swenjj 4 · 0⤊ 0⤋