joec, did I make a mistake in my calculation? Based on my calculation, for that scenario, it’s much cheaper to go w/ Roth. I didn’t say you take out the $1.8M all in one year. I assume this person would take the $1.8M out over 20 years, starting at age 70.5. Which equate to $90k/yr on top of SS, etc. I’m sure you’re aware, that’s why you picked the 70.5 age, but traditional has minimum distribution while Roth doesn’t.
Job change won’t affect your calculation that much unless you’re out of a job for a whole year or more.
Yes, I agree that everyone’s case is different. No investment vehicle is a no brainer for everyone. I’m just trying to say that the longer you are away from retirement, the better Roth becomes. Assuming you don’t have too many gaps in employment. I also noticed that you mentioned that you won’t have any income during retirement. In my calculation, if someone start saving $1k/month, they’d have $1.5M in 30 years w/ 8% yearly return. The interest you get from $1.5M would be considered income. Wouldn’t SS also considered income?
