I make 110k post tax now, thanks mainly to the FEIE (Overseas US citizen expat). My income may rise a bit over the next few years as well. I plan to retire in 10-12 years and withdraw 30k to 50k per year, more likely at the lower end. I am self employed under an LLC treated as an S corp.
I think my optimal savings structure is:
1. Roth Solo 401k. Etrade has these, and I may open one if this is better than Traditional
2. Roth IRA. To add another 6k per year. I plan to open one at Schwab
Is that correct? I also have a Fidelity HSA.
Solo 401k: Roth vs Traditional
Re: Solo 401k: Roth vs Traditional
I don't know about the FEIE considerations -- can you even contribute FEIE excluded income to a solo 401(k)? I know you can only contribute to an IRA to the extent that your income exceeds FEIE.
As always Roth vs traditional comes down to current vs retirement marginal tax rates. Your income is quite a bit higher than your planned spending which might suggest that that you might be better off with traditional than Roth (unless you can contribute FEIE excluded income). If you aren't paying state tax now and expect to in retirement that might change the math in favor of Roth.
Also look at how traditional solo 401(k) contributions effect the Qualified Business Income deduction. This can make the actual tax savings for traditional solo 401(k) contributions 20% lower than your normal marginal tax rate would suggest.
E*Trade is a good option as they allow Roth contributions, allow incoming rollovers from IRAs (useful if you have any traditional IRAs and want to make backdoor Roth contributions) and have many good investment options, including a number of Vanguard funds.
As always Roth vs traditional comes down to current vs retirement marginal tax rates. Your income is quite a bit higher than your planned spending which might suggest that that you might be better off with traditional than Roth (unless you can contribute FEIE excluded income). If you aren't paying state tax now and expect to in retirement that might change the math in favor of Roth.
Also look at how traditional solo 401(k) contributions effect the Qualified Business Income deduction. This can make the actual tax savings for traditional solo 401(k) contributions 20% lower than your normal marginal tax rate would suggest.
E*Trade is a good option as they allow Roth contributions, allow incoming rollovers from IRAs (useful if you have any traditional IRAs and want to make backdoor Roth contributions) and have many good investment options, including a number of Vanguard funds.