Roth 401(k)
An employer plan that combines a 401(k)'s high limits with a Roth's tax-free withdrawals.
A Roth 401(k) is a workplace retirement option funded with after-tax pay, so qualified withdrawals in retirement are tax-free. It blends the higher contribution limits and employer match of a 401(k) with the tax treatment of a Roth account.
Examples
- Choosing Roth contributions in your 401(k) means paying tax now for tax-free growth.