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Should you use a Roth 403(b) instead of a traditional pre-tax 403(b)?
In this episode of the Washington State Retirement Planning Podcast, we break down how a Roth 403(b) works and why it can be one of the most underutilized retirement benefits available to Washington State employees.
We explain the difference between contributing pre-tax and after-tax money, why a Roth 403(b) can provide tax-free growth and tax-free qualified withdrawals, and why it’s important to evaluate your tax situation each year instead of automatically choosing pre-tax contributions.
We also cover an important distinction that many employees overlook: the Roth 403(b) is just the account structure – what you invest in inside the account matters too. Different plans can have very different investment choices, fees, annuities, and levels of flexibility.
Later in the episode, we answer a listener question about how many years of service you should have before retiring. We explain why 27 years doesn’t automatically qualify you for full benefits, why 30 years can be an important milestone, and the tradeoffs that come with retiring early, including permanent pension reductions, healthcare costs, and the need to make your retirement savings last longer.
If you’re a Washington State employee trying to decide between Roth and pre-tax retirement savings or wondering when you can realistically retire, this episode will help you understand the key considerations.
00:00 Roth 403(b) explained
02:14 How a Roth 403(b) works
03:08 Roth 403(b) contribution limits and income rules
04:07 Why the investment inside your Roth 403(b) matters
05:09 Listener question: How many years should you work before retiring?
06:28 The tradeoffs of retiring early
07:29 Why 30 years is an important milestone
08:14 Should you keep working after 30 years?
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DISCLAIMER
**Advisory Services offered through Intirety, LLC a registered investment adviser. Intirety LLC and Scenic Financial are not associated with the Washington State Department of Retirement in any way. Scenic Financial makes content available as a service to its clients and other visitors, to be used for informational purposes only. While our best intentions are to provide accurate and timely information, you should always consult with retirement, tax, and legal professionals prior to taking any action. 🕸️
