u/Happy-Glove9277

I'm trying to decide whether to contribute to a Traditional 403(b) or a Roth 403(b), and I'd appreciate some input. [edit: I am now seriously considering splitting between traditional and roth.]

One more point: I consider myself highly knowledgeable about retirement tax planning, so I'm not looking for explanations of how Traditional and Roth accounts work. I've already built several math models using different assumptions (tax rates, investment returns, Roth conversion windows, RMDs, etc.), and Traditional comes out ahead every time for my situation. I want to see if I am overlooking any important considerations.

Here's my situation:

• Age: 49
• Married filing jointly, current federal tax bracket: 12%
• Tenured college professor at a R1 institution; my wife is a homemaker.
• I contribute about $45k/year to my Traditional 403(b) and 457 (including employer match).
• We also max out both Roth IRAs and our HSA every year.
• We immigrated to the U.S. in 2017, so we started saving for retirement relatively late. Since 2022, we've been contributing about $68k/year to retirement accounts.
• Current retirement assets are about $700k, including approximately $400k Traditional and $120k Roth (the remainder is in brokerage accounts). No mortgage; house bought with cash.
• We also receive annual cash gifts from our parents, so we don't rely on employment income for saving and living expenses.
• I plan to retire around age 62 and delay Social Security until age 70.
• Between retirement and age 70, I expect to have very little taxable income, so my plan is to do Roth conversions during those years.
• We currently live in a state with income tax but plan to retire in Washington, which has no state income tax. That decision is pretty much settled. I love Washington's climate. The cloudy, rainy weather is actually a plus because of my skin issues. We also want to live near a large Asian community, so Washington is really our only choice.
• We also own properties in Asia and expect to spend about half of each year there during retirement.

Reasons supporting traditional 403(b):

• I can save my state income tax because I will retire to WA.
• I could later do Roth conversions during my low-income years.

Reasons supporting Roth 403(b):

• I only pay 12% federal tax now.
• It provides tax diversification.
• It protects against the possibility of higher future tax rates.
• Qualified withdrawals are tax-free.

Given these facts, which option would you choose, and why? Am I overlooking any important considerations?

I am wondering what the average retirement savings are for Americans. The numbers posted online are so misleading because they are reported per account rather than per person. Since many Americans have multiple retirement accounts (multiple 401(k)s because of job change, IRAs, pensions, etc.) and many families have more than one income earner, these figures surely underestimate total retirement savings.

Based on my observation of people around me, my impression is that the average American has at least $1 million in retirement savings by age 60, excluding home equity.

I moved to the U.S. in 2017 and started building retirement savings relatively late. Currently, I have only $690,000 in retirement accounts and a paid-off home worth about $600,000. I am 49 years old, I am behind the $1 million benchmark because I am the sole income earner in my family, with a homemaker wife and one child.