While I applaud your enthusiasm, there are some clarifications that are necessary. First, I agree that it is prudent for participants to maximize any match from the plan sponsor, but that isn’t free money. It’s money that plan sponsors are willing to provide as incentive for the participant to save for retirement and is part of the employee benefits cost of the plan sponsor. An employee benefit that should certainly be valued by the participant. Nothing is free. In addition, the Roth IRA is not tax free, and is certainly not free money. Taxes are paid on the contributions in the year that they are made. A study this year by the Center for Retirement Research at Boston College (“What is the tax advantage of 401(k)s”, February 2012 Number 12-4) shows on average the tax benefits of current deferral and Roth contributions are equivalent. The truth is that the difference between benefits to Roth versus regular tax deferred deferrals will depend on the facts and circumstances surrounding each individual participant. Individuals should consult with qualified tax advisors to determine what is best for them.

This analogy will make it easier for me to explain to my clients the need to talk to their TPA and exactly what type of services they are receiving. And possibly how it may effect their tax obligations now and in the future.