Message Font: Serif | Sans-Serif
No. of Recommendations: 0

Given that I will be in a higher tax bracket than usual this year (I am receiving some severance from a previous employer)...I am thinking about putting it all into deductible IRA's to get the deduction and then try to save the rest so I can hog wild on my 401(k) next year to catch up rather than invest in a Roth (as I normally do). I am in my later 30's.

Does this seem to be the better of the two alternatives from a tax strategy standpoint. I understand the pay now or pay later concept, it's just that my taxable income will be unusually high this year due to this one time event.

Thanks again.
Print the post  


In accordance with IRS Circular 230, you cannot use the contents of any post on The Motley Fool's message boards to avoid tax-related penalties under the Internal Revenue Code or applicable state or local tax law provisions.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.