I was trying to create a best case scenario for the money put aside so I figured it would be invested and held for duration then sold off at the capital gains tax rate of 15%. That’s best case. As you point out it can get a lot more complicated than that and face a lot higher tax rates.
You are also correct that you can take money out over time to control taxes. The point is to compare a Roth vs Traditional 401k. I ‘m not opposed to 401ks at all everyone should have one and make sure they are taking advantage of them. The point of this post is to show that a Traditional 401k doesn’t give you some hidden tax savings versus other types of investing, including a Roth 401k.

@EvolutionWealth

For example, let’s say you buy a bond, with a 7% yield… some of that yield is going to come to you as interest payments, and interest payments are TAXABLE ANNUALLY on your 1040.

Oh, it’s a stock… with no dividends?
Mutual fund? both div’s and cap-gains.

So, where do you pay the 20,ooo tax due on your 401k? Well, to start with, you do have 80,000 and/or you could take the money over time to get to a smaller tax bracket then the 25% you assumed — you can start taking the money after age 59.5 (in most cases) and aren’t FORCED (min required distributions) to take anything until the year you turn 70.

Why are you so opposed to 401k’s?