A discussion arose on whether one should continue investing in a 401(k) after reaching financial milestones. The original poster, who has a significant retirement savings, is considering if he should stop contributing. Experts suggest that, while employer matches are vital, transitioning to alternative accounts like Roth IRAs can avoid hefty taxes and RMDs later in retirement. Roth accounts provide tax benefits and help maintain flexibility in withdrawal strategies, especially for high earners worried about tax liabilities in retirement.
If you are earning a 401(k) match from an employer, you should never stop investing enough to earn the full match.
Once you have earned your full employer match, there is definitely an argument to be made that at some point you can switch to putting retirement money into other things.
Investing in Roth accounts can help you enjoy your retirement income without a huge tax bill, which is a major concern if you retire rich.
Roths don't have RMD requirements, which allows you to avoid forced large distributions.
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