The Roth Advantage and Why Tax-Free Growth Could Be Your Smartest Move
Leverage 2025’s new limits, 2026’s looming tax hike, and a few well-timed conversions to unlock six-figure lifetime savings
Hello, Dear Friends!
Here’s a Two-Minute Thought Experiment 🚀:
Picture a Tuesday morning in Austin. Two founders are grabbing cortados before stand-up:
Founder A funnels every spare dollar into a pre-tax 401(k).
Founder B maxes a Roth 401(k), sprinkles in Backdoor Roths, and converts aggressively in any low-income year.
Both earn the same salary, and both clear the same exit in 2035. Yet when they turn 65, Founder B keeps ~30 percent more spendable cash, solely because her growth escaped the IRS dragnet.
That’s the Roth edge in a nutshell: pay a small, known tax today to dodge a potentially bigger, unknown tax tomorrow, while compounding tax-free the entire way.
With one year left before the Tax Cuts & Jobs Act sunsets (2026), 2025 may be your cleanest shot in a decade to juice that edge. Let’s break down how.
1. 2025: The Calm Before a Tax-Rate Storm
Top bracket stays at 37 percent, for now, kicking in at $626,350 single / $751,600 joint (IRS).