Suze Orman Says This Retirement Account Could Be Your Best Bet

Core Viewpoint - Suze Orman advocates for the Roth 401(k) as the optimal retirement savings account due to its tax advantages during retirement [3][7][8] Group 1: Advantages of Roth 401(k) - Roth 401(k) accounts provide tax-free withdrawals in retirement, which do not count as taxable income, thus avoiding potential taxes on Social Security benefits and higher Medicare premiums [7] - Contribution limits for Roth 401(k) are higher than those for Roth IRAs, allowing for greater tax-advantaged retirement savings [7] - The account allows individuals to skip immediate tax savings in favor of more significant tax savings later in life [5][6] Group 2: Comparison with Traditional 401(k) - Traditional 401(k) contributions reduce taxable income in the year of contribution, providing immediate tax savings [4] - In contrast, Roth 401(k) contributions are made with after-tax money, meaning no immediate tax deduction is available [5] - The trade-off is that while traditional 401(k) offers upfront tax benefits, Roth 401(k) offers long-term tax-free growth and withdrawals [5][6]