I Am 58 With $1 Million in My 401(k). Should I Switch to Roth Contributions?

Whether to make the move from contributing to a tax-deferred workplace plan or switch to a Roth isn’t a question of “should” but a question of, “What works best for you?” Just a few of the considerations are:

How much you plan to save toward retirement
Your current vs. future tax situation
The specifics of your Roth option
Whether you’ll leave money behind for heirs

You can speak with a financial advisor to help you understand the tradeoffs, as retirement decisions made early on in your journey are important.

A Quick Review

With a 401(k) plan, your contributions aren’t taxed at the time you make them but are taxed when you take withdrawals. In many cases, you’re also getting an employer match to your contribution, which is free money. If, for example, your employer gives a 50% match on contributions up to 5% of your salary, you’re getting an automatic 50% gain on that money every time you make a contribution. That kind of return is hard to beat.

But, like any other tax-deferred plan, you’ll also need to start taking required minimum distributions at age 73 (or 75 for those born after 1960), which will result in taxes and could very likely result in making up to 85% of your Social Security benefits taxable.

With a Roth IRA, you don’t get the tax break when contributions are made, but you won’t pay any tax on withdrawals (including your investment gains) as long as you are at least 59 ½ years old and the account has been open for five years.

Consider the Taxes

The younger you are, the more sense a Roth account makes, because you’ll have decades of compounded returns on your investments that will be shielded from the tax man’s grab. One common piece of advice to young workers is to make 401(k) contributions up to the limit of any employer match and put any other retirement savings into a Roth IRA.

Part of that advice also applies to older workers. Even at the age of 58, you’ve got decades of investing ahead of you. For example, you still have nine years until you reach your full retirement age of 67 and potentially decades of retirement. That makes having at least some of your assets in non-taxable accounts a smart move.

However, older, well-paid workers are likely to hit the contribution limits on a Roth IRA. For 2026, you can’t put more than $7,500 into a Roth, plus another $1,100 if you’re older than 50. In addition, your modified adjusted gross income (MAGI) as a single filer must be less than $153,000 to make a full Roth IRA contribution and less than $168,000 to make a partial contribution. The income limit for joint filers is $242,000 for a full contribution and $252,000 for a partial contribution.

Your 401(k) plan, however, has no income limits and will let you stash up to $24,500 of pre-tax salary in your account in 2026, plus another $8,000 if you’re at least 50. 401(k) participants between 60 and 63 may be able to save an extra $3,250 thanks to an enhanced catch-up contribution that was introduced in 2025.

A financial advisor can help you make hypothetical projections to evaluate your options for funding retirement.

What Kind of Roth Account?

Another consideration is the type of Roth account: Is it a Roth IRA or a Roth 401(k) plan? The Roth 401(k) is newer but more employers are offering them. Like a Roth IRA, your contributions are taxed and all withdrawals are untaxed. But, in most cases, the employer match is made with pre-tax money, which adds some complexity to your withdrawal strategy in retirement.

The good news is that both the Roth IRA and Roth 401(k) plans aren’t subject to required minimum distributions, allowing you to keep all of your Roth investment compounding throughout your retirement. Any money left to your heirs won’t be taxed, either, and the restrictions on liquidating an inherited Roth account are much more relaxed.

More to Consider

A few more points to consider about a 401(k) are that, while you’re working most plans give you the option to borrow against your account, which forces you to repay yourself (with interest). By comparison, you can withdraw contributions without penalty (but not gains) from a Roth account, even before age 59 ½. However, there’s no mechanism that forces you to replace the money withdrawn from what’s supposed to be a retirement account.

Another reason for keeping a 401(k) account current is that if you’re working for the employer you aren’t forced to take required minimum distributions until after you’ve retired.

If you need help calculating your RMDs, SmartAsset’s RMD calculator can estimate how much your distributions will be and when they’re due to start.

Required Minimum Distribution (RMD) Calculator

Estimate your next RMD using your age, balance and expected returns.

Quickly estimate your RMDs and when to take them

RMD Amount for IRA(s)

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RMD Amount for 401(k) #1

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RMD Amount for 401(k) #2

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About This Calculator

This calculator estimates RMDs by dividing the user's prior year's Dec. 31 account balance by the IRS Distribution Period based on their age. Users can enter their birth year, prior-year balances and an expected annual return to estimate the timing and amount of future RMDs.

For IRAs (excluding Roth IRAs), users may combine balances and take the total RMD from one or more accounts. For 401(k)s and similar workplace plans*, RMDs must be calculated and taken separately from each account, so balances should be entered individually.

^*The IRS allows those with multiple 403(b) accounts to aggregate their balances and split their RMDs across these accounts.

Assumptions

This calculator assumes users have an RMD age of either 73 or 75. Users born between 1951 and 1959 are required to take their first RMD by April 1 of the year following their 73rd birthday. Users born in 1960 and later must take their first RMD by April 1 of the year following their 75th birthday.

This calculator uses the IRS Uniform Lifetime Table to estimate RMDs. This table generally applies to account owners age 73 or older whose spouse is either less than 10 years younger or not their sole primary beneficiary.

However, if a user's spouse is more than 10 years younger and is their sole primary beneficiary, the IRS Joint and Last Survivor Expectancy Table must be used instead. Likewise, if the user is the beneficiary of an inherited IRA or retirement account, RMDs must be calculated using the IRS Single Life Expectancy Table. In these cases, users will need to calculate their RMD manually or consult a finance professional.

For users already required to take an RMD for the current year, the calculator uses their account balance as of December 31 of the previous year to compute the RMD. For users who haven't yet reached RMD age, the calculator applies their expected annual rate of return to that same prior-year-end balance to project future balances, which are then used to estimate RMDs.

This RMD calculator uses the IRS Uniform Lifetime Table, but certain users may need to use a different IRS table depending on their beneficiary designation or marital status. It's the user's responsibility to confirm which table applies to their situation, and tables may be subject to change.

Actual results may vary based on individual circumstances, future account performance and changes in tax laws or IRS regulations. Estimates provided by this calculator do not guarantee future distribution amounts or account balances. Past performance is not indicative of future results.

SmartAsset.com does not provide legal, tax, accounting or financial advice (except for referring users to third-party advisers registered or chartered as fiduciaries ("Adviser(s)") with a regulatory body in the United States). Articles, opinions and tools are for general informational purposes only and are not intended to provide specific advice or recommendations for any individual. Users should consult their accountant, tax advisor or legal professional to address their particular situation.

In the end, a mix of taxable and tax-free retirement accounts gives you several options in terms of timing your retirement, deciding when to collect Social Security benefits, how to deal with taxes and required minimum distributions, what can be left for heirs, and more.

It doesn’t hurt to get a second opinion on important financial decisions. Get matched and speak with a financial advisor for free.

Bottom Line

A tax-deferred workplace 401(k) account and a Roth account that provides tax-free withdrawals each come with advantages and drawbacks. Thinking through your long-term retirement goals and overall strategy can help you decide which type of account, or combination of accounts, fits your situation best.

Retirement Planning Tips

A financial advisor can help you plan and save for retirement. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with vetted financial advisors who serve your area, and you can have a free introductory call with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
How you draw income can matter as much as how much you’ve saved. Coordinating withdrawals across taxable accounts, tax-deferred accounts and Roth accounts can help smooth income and manage taxes over time. Thinking this through in advance also helps reduce the risk of drawing too much early in retirement.