For various reasons, you should split your contributions between "pre-tax" and "after-tax" accounts.
You can make contributions to your traditional K enough to maximize the tax credit, and make additional contributions to the ROTH side.
Tax rates are actually at fairly historic lows; which supports ROTH contributions now.
Additionally - the balance in your account 35 years from now is going to be primarily money that is from GROWTH (not from contributions). In a ROTH, NONE of the growth is taxed (i.e. Pay tax on $100K today, but pay NOTHING on $5M+ of growth money in 35 years).
Having a well funded ROTH at retirement allows you to make larger "lump sum" type withdrawals (like for a car purchase) without bumping you into a higher tax bracket.
I would recommend using both a Roth and a Traditional 401k. With your timeline -- you have no idea what the tax situation will be when you start to draw from it. It's better to be diversified in that regard.
You need to speak with a tax advisor because I make 187,200.00 and I'm in my 30s not including my wife income of 104k. We need a traditional 401k to lower our taxable income. Last I checked, there are no income restrictions for Roth 401(k) contributions. According to IRS guidelines, single tax filers whose taxable income is more than $120,000 and married-filing-jointly tax filers whose taxable income is more than $177,000 cannot contribute to a Roth IRA so you need to speak with a tax advisor. You may want to pay taxes on your contributions now ― so Roth 401(k) contributions may make sense for you. On the other hand, if you expect to be in a lower bracket after you retire, you may want to pay the taxes then, which means traditional 401(k) pretax contributions may be a good option. Speak with a tax advisor
Best of luck
Roth if you can do it. If you are making that at age 31, you are liable to also have high retirement income so a Roth would be to your advantage. Nothing is quite as annoying as paying regular income taxes in retirement, sending in $12k in estimated tax prepayments and then having to pay an additional $10k when you get your taxes done.
I would Roth IRA (not 401K), the only reason I consider the 401K plans is if my employer matching my contributions. otherwise, it would be much better to go with the IRA (roth)
if you're able to max out the annual contribution ($18,000) - maybe Roth is the way to go - you'd have a lot of tax free income at retirement and the money are are making - $1000 tax credit is peanuts
I prefer Roth. I like the idea of not paying taxes on the withdrawals.
if your income is at a certain level, you can't do a roth. check irs.gov now
