Advice: Roth vs. Traditional with a pension
I have a pension that I have started receiving at 42. The pension is $65k. I have now started a new job/ second career. My salary puts me firmly in the 24% bracket without the pension (I stay in 24% with pension). I'm trying to figure out if I should contribute to a traditional 401k, Roth 401k, or a combination.
- Pension: $65k; inflation adjusted for life
- Employer match: .75 for every $1, up to 4.5% of salary
- Current retirement investments: All Roth
- Timeline: 15-20 years before I plan to really retire
- Taxes: Married filing jointly.
- Personal belief: I think taxes will have to go up before I reach real retirement age
I'm currently thinking of going 50/50 after accounting for employer contributions (more like 70% Roth, 30% traditional on my contributions) in order to build some pre-tax funds, but I don't want to have too much in pre-tax because of my belief on future taxes and my pension plus future social security income.
What say you?