Jill on Money with Jill Schlesinger

Should I Switch to Roth 401(k)?

Dec 27, 2024

Is it time to shift from a pre-tax 401(k) to a Roth? Explore the pros and cons of this transition. Delve into essential wealth management strategies for business owners. Listen to real-life listener questions about retirement and the complexities of financial infidelity. Understand the importance of financial separation and gain insights on comparing Roth and traditional accounts. Get ready to make informed financial decisions!

16:59

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Quick takeaways

Maintaining separate finances in relationships can protect individual interests, especially when one partner has financial management issues.

Switching to a Roth 401(k) allows for tax-free withdrawals in retirement, providing significant long-term financial benefits compared to traditional accounts.

Deep dives

Navigating Financial Relationships

Maintaining separate finances in a relationship can be a crucial strategy for protecting personal financial interests, especially when one partner has a history of financial mismanagement. This approach allows individuals to avoid potential risks associated with co-mingling funds, such as shared credit cards and joint bank accounts, which can lead to complications if trust issues arise. For example, one listener highlighted his concerns about his spouse's ongoing credit card debt and IRS problems, prompting him to consider strategies to safeguard his financial future. It is emphasized that open communication and clear boundaries regarding finances can help mitigate risks and foster healthier financial habits within partnerships.