[dfwgator]

Also if you are in a higher tax-bracket, the 401K is serious reduction in taxes. Say you are in the 30% bracket and you put away $20,000, that’s a savings of $6,000 in taxes, and compounded over time, that’s a pretty nice chunk of money.

[SamAdams76]

Great point.

[Alberta's Child]

Also if you are in a higher tax-bracket, the 401K is serious reduction in taxes. Say you are in the 30% bracket and you put away $20,000, that’s a savings of $6,000 in taxes, and compounded over time, that’s a pretty nice chunk of money.

This point has been magnified after the 2017 tax reform, since retirement plan contributions are among the only tax deductions left for the vast majority of people who don't earn enough to justify itemizing their deductions.