An after-tax 401k is a special type of 401k contribution that allows you to add additional "after-tax" money into your 401k account. Most long-term investors realize there aren’t too many ...

Some 71 million workers have access to 401(k) retirement plans and they have saved $8 trillion toward their retirement. The program, which started in the late-1970s, has become one of the premier ...

Higher earners may use this planning tool to fund a Roth account. “A 401(k) has no income restrictions on after-tax contributions, but a Roth outside does,” Dudley said.

Although after-tax 401(k) contributions may sound like a Roth 401(k), there is at least one significant difference. Your withdrawals in retirement won’t all be tax-free.

Like your regular 401(k), you’ll be able to move your after-tax 401(k) to a new employer or to another retirement plan. After-tax contributions can be rolled over into a Roth IRA.

Your contribution to a Roth 401(k) doesn't reduce your taxable income, but you won't have to pay income tax on your retirement withdrawals from a Roth - unlike withdrawals from a traditional 401(k).

Because Roth 401(k) contributions are made with after-tax dollars, Roth 401(k)s must be rolled over to either a Roth IRA or a new employer's Roth 401(k) (if that employer offers one).

A Roth 401(k) has after-tax contributions and tax-free withdrawals during retirement. 401(k) withdrawals before age 59½ may be subject to early withdrawal penalties.

I have $120,000 in after-tax contributions in my traditional 401(k) at work. Can I roll over just the after-tax money into my Roth IRA? I would like to avoid creating a taxable event. – Daniel ...

In a Roth IRA, you contribute after-tax dollars and then can receive tax-free withdrawals in retirement. The only criteria are that you must be 59 1/2 years old and made your first contribution at ...

For a Roth IRA, distributions can be taken after age 59 1/2 from accounts at least five years old. In contrast, you will owe income tax on each withdrawal from traditional IRAs and 401(k)s.