Episode 2 of 6
The Mega Backdoor Roth
Dan's 401(k) plan allows after-tax contributions with in-plan Roth conversion — the mega backdoor Roth. He can contribute an additional $43,500/year in after-tax dollars. The model shows the 20-year impact.
Key Insight
Contributing $43,500/year in after-tax dollars and immediately converting to Roth adds $870k in tax-free retirement assets over 20 years at 7% growth. The tax cost at conversion is $0 (already after-tax money). This is the single highest-impact move available to high-income earners with the right plan.
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