re: Saving More for Retirement - Trad IRA vs Normal Brokerage Account

You should consider your top marginal income tax rate now and what you expect it to be in retirement. You don't know what the rates will be in the future, just use today's rates, or go back and use the Obama rates. It probably works the same.

Use a reasonable rate to project your tax deferred 401K/IRA balance when you retire. Add your expected Social Security benefit, and your wife's if you are married. Then look at where the tax rates break. At today's rates, the 12% Federal rate extends to $100K for a married couple. You also get a large standard deduction.

At that point, the Roth comes into play. If you are in a high income bracket now, like 34% +, it doesn't make sense to convert to a Roth if your top rate in retirement is 12% or 22%. Roth's are useful and more flexible, but not worth paying more taxes now to save less on taxes later.

If you are in a higher tax bracket, put some in a Roth, maybe 10% of your savings, but wait until after you retire, take smaller distributions to stay in a lower tax bracket, and try to do Roth conversions form your deferred assets at a lower tax bracket.

If you have extra money to invest, tax deferred is better if you are in a higher tax bracket. If your top marginal rate is going to be the same in retirement, then it really doesn't matter. 34% is 34% whether you are retired or not.