Roth 401K, Roth IRA, 401K Retirement Plans: Which is Best?

The Roth 401 (k) plan is a new form of retirement account combining the Roth IRA (k) plan and the regular 401 (k) plan. It has bits of both plans which allows the employee to have more flexibility when planning out his retirement as long as his employer agrees with the the switch.

There is no limit to how much income an individual or a couple receives in the Roth 401 (k) plan, but tax is taken off after received income, rather than the 401 (k) plan. However when the employee turns 59 1/2 he is not subject to taxation on his withdraws from the Roth 401 (k) plan. Taxing on income is the main difference between all three plans; whether one wants to be taxed after income through the Roth 401 (k) plan or when he withdraws from the plan after he is 59 1/2 years old  in hopes of a better tax rate through the 401 (k) plan.

Below are listed the key differences and similarities between the three plans:

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