I’ve been maxing out my after-tax 401(k) and converting it to a Roth for 2 years — is this a good strategy?

Rich Duprey

Tue, May 19, 2026 astatine 8:50 AM CDT 6 min read

Some 71 cardinal workers person entree to 401(k) status plans and they person saved $8 trillion toward their retirement. The program, which started successful the late-1970s, has go 1 of the premier vehicles for individuals to guarantee they person a comfy manner aft quitting the rat race.

While the $24,500 publication bounds tin beryllium a hard threshold to scope for the mean worker, not lone is it a simpler way for precocious wage earners, but it is not astir enough. With an excess of funds disposable to defer to retirement, they person disposable to them different concern vehicles beyond a elemental Roth IRA, arsenic that lone allows for $7,500 successful after-tax contributions.

One of the often-utilized strategies is what is called a mega backdoor Roth conversion. That is wherever you max retired your 401(k) contributions, but past spot further wealth into the program with after-tax contributions up to a combined full of $72,000. For savers aged 60 to 63, a higher catch-up tier bumps this maximum wide program headdress to $83,250. The other contributions are past rolled implicit into a Roth IRA relationship or, if your 401(k) program allows, into a Roth 401(k) account.

Key Points

• Mega backdoor Roth conversions let high-income earners to lend up to $72,000 annually ($83,250 for ages 60-63) successful after-tax wealth that grows tax-free, compared to lone $24,500 successful pre-tax 401(k) contributions and $7,500 successful Roth IRA contributions.

• Mega backdoor Roth conversions connection superior taxation benefits to regular taxable brokerage accounts due to the fact that contributions and net turn tax-free, whereas brokerage accounts look semipermanent superior gains taxes, and they debar Required Minimum Distributions that use to accepted status accounts.

  Are you ahead, oregon down connected retirement? SmartAsset's escaped instrumentality tin lucifer you with a fiscal advisor successful minutes to assistance you reply that today. Each advisor has been cautiously vetted, and indispensable enactment successful your champion interests. Don't discarded different minute; larn much here.

• Are you ahead, oregon down connected retirement? SmartAsset's escaped instrumentality tin lucifer you with a fiscal advisor successful minutes to assistance you reply that today. Each advisor has been cautiously vetted, and indispensable enactment successful your champion interests. Don't discarded different minute; larn much here.