Operation Roth 401(k) – Phase One Complete :)

Yesterday I decided to campaign for a Roth 401(k) option at work. We get pretty good benefits here, I guess, so I’m not complaining. And I admit that I probably haven’t taken complete advantage of all of our options, but I do max out the 401(k) and have subsidized health and dental insurance through work. I also take advantage of the flexible spending and tax-advantaged commuting account options.

But it certainly would be nice to have a Roth option. Many of us, for one reason or another, don’t qualify for a Roth IRA. So the Roth 401(k) is our only potential way to have a Roth option. And even for those who do qualify for a Roth IRA, the annual limit is much greater for the Roth 401(k), so it would be good to have additional Roth options.

I like Nicole’s method of splitting the contributions between a traditional and Roth 401(k). This way you get some tax benefits now and hedge against higher taxes later. I’m going to look more into this (without counting chickens before they hatch). So even for those who qualify for a Roth IRA, you could include that amount in your split and do a higher percentage traditional 401(k) to equal the Roth IRA and Roth 401(k) if you’re looking for a 50/50 split.

So many possibilities! I love options (except when I’m trying to order food at the Cheesecake Factory… that’s why the wait is so long – people take too long to read the menu!)!

Anyhow – onto phase one. I approached the director of administration at my company. She and I go way back and have a great relationship. She’s an amazing woman and a fantastic administrator who always seems to look out for the worker-bees’ best interests. I walked in and said something to the effect of:

I was hoping to get a Roth 401(k) option here. I think many people would like to at least split their contributions to hedge against rising taxes.

Her response was something to the effect of “I’m not the person, but [insert the person's name here] is. You can e-mail him if you want, but I’m happy to do it for you.” Score. I was happy e-mailing the right person, but took her up on the offer, just to save my bullets in case I decide to have more “operations”