Thank you. I *think I understand. Sounds like I/he need more info on the DBP so we’ll wait on that.Looks as if he may be able to buy a certain amount of a defined benefit pension. Whether that is a good deal (or even whether that's what it is) depends on that "emailed to you separately" information.It is a defined benefit plan.
It appears the 401k allows
a) traditional,
b) Roth, and
c) after-tax non-Roth contributions.
He needs to choose first between a & b (see Traditional versus Roth). Option c is the first step in the MBR (#7 in the prioritizing investments link).
Other than the to-be-determined information about the DBP, is the rest making sense? If so, good - if not, what questions remain?
From reading the articles, it sounds like he should max out the 401k first prior to considering the DBP. Pretty sure that should be traditional as opposed to Roth. From the investment priorities article, it seems he should max out the pretax 401k (20% of his income), prior to doing a MBDR. Is my thinking, correct? He makes about 200k per year, and I’m trying to encourage him to do the full 20% of saving to start with.
Statistics: Posted by Michelle2024 — Tue Jul 02, 2024 9:02 am — Replies 6 — Views 341