Why Your 401k Contributions Might Be Costing You Tax Money

Episode 129 of Wealth Building with Fexingo dives into a common retirement planning mistake: assuming traditional 401(k) contributions are always better than Roth. Lucas and Luna unpack the math behind marginal vs. effective tax rates, showing how even high earners can benefit from Roth contributions today to avoid a tax bomb in retirement. Using a real example of a couple earning $180,000, they demonstrate how small Roth allocations reduce future RMDs and Medicare surcharges. The episode also covers pro-rata rules, employer match interactions, and when to switch strategies as tax brackets change. A practical, numbers-driven look at optimizing tax diversification across your working years. #RetirementPlanning #TaxStrategy #Roth401k #Traditional401k #MarginalTaxRate #EffectiveTaxRate #RMDs #MedicareSurcharges #TaxDiversification #PersonalFinance #Investing #WealthBuilding #FexingoBusiness #BusinessPodcast #FinancePodcast #Retirement #TaxAwareInvesting #CompoundGrowth Keep every episode free: buymeacoffee.com/fexingo