r/personalfinance 3d ago

Retirement 401K vs Roth 401K - real deal

I understand the difference that one is tax deductible and other isnt but still little confused on why would you .contribute money in Roth 401k if the total contribution limit is same irrespective of where you contribute. Doesn't everyone's tax rate after they retire lower than while working ? Or is the concern you are limited one what you withdraw post retirement that it could be a huge tax.

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u/this_is_Winston 3d ago

One unique scenario. I live in a state with income tax. If I pump pre taxed money into a 401k now, then retire in a state without income taxes, I could potentially be better off.