Do 401k To Roth Ira Transfers Count Towards Your Contribution Limit

A Roth IRA is  totally useless if you  do not, invest the money in your Roth IRA. Here, the number one  area for financial education I’m going to go over three of  the most effective Roth IRA investments. Do 401k to Roth IRA transfers count towards your contribution limit. Any type of one of these investments can and will make you a tax-free millionaire.

Do 401k To Roth Ira Transfers Count Towards Your Contribution Limit

I’m additionally going to make a referral on just how to choose which of these three techniques is best for you. Just like numerous things in life, there’s never one appropriate solution. Due to the fact that the most effective investment for you might not be the best financial investment for somebody else. Do 401k to Roth IRA transfers count towards your contribution limit.

 So I  desire you to be as  enlightened as  feasible  to ensure that you can be in full control of what happens to your money. 

 

 

It makes sense to use your Roth IRA for high growth investments, since usually more revenues amounts to more tax obligations, however not if those investments are inside your Roth IRA. Not just this, but the Roth IRA is a long-term lorry, so it additionally does not make sense to invest for Passive earnings in your Roth IRA.

  Rather of  concentrating on  easy  revenue in your Roth IRA, why not focus on  development?   So this rules out a  great deal of investments,  for instance, Bonds or Money, Market Investments like CDs  and also short term Treasuries,  as well as  definitely not  money,  due to the fact that you  do not  intend to  lose the tax shield of the Roth IRA on investments that return only one or two percent or nothing. 

 

Do 401k To Roth Ira Transfers Count Towards Your Contribution Limit

  So  presuming you’re not  ready to retire next year, you  desire growth  and also  concentrated investments for your Roth IRA.  In other words, you  intend to  purchase stocks.  So,  allow’s  discuss the three ways to  buy stocks, for your Roth IRA.  Do 401k to Roth IRA transfers count towards your contribution limit.  I’ll initially detail, what they are and afterwards I’ll clarify how every one works in order of simplest to the majority of advanced.

  1. 1. The first way to purchase your Roth IRA is to get target-date funds
  2. The 2nd method is to buy index funds.
  3. The 3rd way is to get individual stocks.

 Let’s go into each of these one by one. 

 Without a doubt the easiest  financial investment for your Roth IRA is  acquiring target date funds. Target date funds is a mutual fund that contains  3 to four different index funds inside it.  Basically, it’s a fund of funds.

Here’s a  common target date fund  and also you’ll,  typically see a  residential stock fund, a International stock fund, a bond fund  as well as  typically a  percentage in a money market or  cash money fund. Do 401k to Roth IRA transfers count towards your contribution limit.  That’s what a fund of funds looks like.

A 2055 fund is going to be  a lot more heavily weighted towards stocks. Do 401k to Roth IRA transfers count towards your contribution limit.  Its called a 2025 fund, due to the fact that if you’re intending to retire actually soon, you do not have the deluxe of awaiting a recovery in the event of a stock market downturn. You’re going to have more bonds, which offers you extra security and also much less in supplies.

Target-Date funds  immediately  choose a blend of investments for you,  based upon your approximate age,  and after that it  adjusts that  mix of investments. As you approach  old age, if  extra Americans owned target-date funds during the last  economic crisis, they  truly would have been much better off.

Do 401k to Roth IRA transfers count towards your contribution limit.  I understand it’s a delicate subject, yet when you hear about people that shed half of their retired life in the 2008 stock market accident, much of them had too much of their portfolio in stocks, offered their age and also or they either offered every little thing and then totally lost out on the recuperation. S, ince it’s every age certain, the name of a time frame fund is constantly going to have a year attached to it.

The Fidelity Freedom Index 2055 funds. Every target date fund has a target retired life year as part of the name, so finding the right one, for you is really very easy.

 Ramit Sethi, a personal finance  expert  as well as  very successful author of “I will  instruct you to be rich”,  suggests  time frame funds for the  substantial  bulk of  individuals. He  speaks about how target-date funds are the  supreme  collection it and forget it  financial investment  as well as they  set you back a  great deal less than  utilizing a robo-advisor. Do 401k to Roth IRA transfers count towards your contribution limit.  Yes, you can accomplish higher returns with other methods like the ones.I’m mosting likely to tell you about a little in the future. These other techniques all need more job and even more initiative. You do not obtain higher returns, placing in less effort. It’s like even more job amounts to a lot more returns.

 That’s why target-date funds are the  rational  option for most people. In that  feeling, target-date funds are a no-brainer  financial investment  alternative for your Roth IRA. 

The  secondly of Roth IRA investments I  wish to  discuss is Index Funds. Do 401k to Roth IRA transfers count towards your contribution limit.  This technique is truly comparable to Target Date Funds, except it’s much more DIY.

The  time frame fund  offers you a complete optimally  alloted portfolio in one  good package,  yet with index funds. Do 401k to Roth IRA transfers count towards your contribution limit.  You essentially would construct that on your own, so you need to choose an asset allocation, that’s right for you as well as for your age, and then you need to find index funds to build that asset allocation.

You would  additionally  require to rebalance your portfolio once the market moves in order to maintain those percentage asset  allotments, as well as keep your  retired life date or your goal date in mind.  And also readjust your portfolio  in the direction of a more conservative allocation  with time.

 It is a little bit  a lot more  job than a target date fund, because you’re  basically going to do yourself what the target date fund would do for you.  Do 401k to Roth IRA transfers count towards your contribution limit.  The alternative that benefits you if you want a bit even more control over your investments, a time frame fund. So for all you type-a, geeks as well as control go crazy there, you’ll probably wish to do it.

 In this manner, I personally do index funds in one of my accounts  and also I  do not do  time frame funds, because I  directly  intend to follow an asset allocation that isn’t offered by  any kind of target date funds. The asset allocation  version that I  comply with is one  suggested by David Swensen. He’s the  epic portfolio manager of Yale’s, thirty billion  buck endowment fund.

I  speak about him a  great deal  as well as he recommends allocating percent in domestic stocks, 15 % in international  supplies, 10 % in emerging markets, 15 % in  United States Treasuries, 15 % in US inflation-protected Treasuries  as well as 15 % in roths or  realty  investment company.

This is a portfolio made of six various index funds, yet if you want to keep it straightforward, you can likewise simply replicate the allocation of a target date fund. As an example, if you check out the Fidelity 2055 fund that we discussed earlier, you see that they have 60 % in residential stocks.They have concerning 30 percent in an International stock fund and the rest of it in bond as well as money market funds. You can simply duplicate that asset allocation and discover index funds to produce that, and also simply do it on your very own.

In fact there’s hundreds of various asset allotments you could choose from. There is no one right solution, but you just intend to understand the pros and cons of each and afterwards choose something. I selected David Swensen’s asset allocation due to the fact that I such as that it does not have a lot of eggs in one basket. Do 401k to Roth IRA transfers count towards your contribution limit.
In other words, there’s no  solitary asset  course that  controls the portfolio there’s like at most 30 percent in the domestic  supplies,  yet  after that  whatever else is 15 percent in  realty  as well as 15 percent in bonds and 15 percent in  arising markets.

This  indicates that, throughout  any kind of  financial cycle or season periods of low  development, high  development, low  rising cost of living,  reduced  and also high inflation, my portfolio is positioned to  profit,  as well as yet it’s still very  development focused  due to the fact that  a lot of it it’s is in  supplies.

  So it’s  truly  simply a fancier version of the  common asset allocation of  a lot of  time frame funds, for a more in-depth  description on  exactly how to invest in index funds for your Roth IRA  ensure to download my Roth IRA investing starter kit.  Do 401k to Roth IRA transfers count towards your contribution limit.  It has detailed guidelines on various asset allotments to select from. The benefits and drawbacks of each allocation, which index funds to purchase as well as how much of each index fund to acquire. It’s really certain extensive. And it’s an impressive resource that I’ve produced just for you and I know you’re going to love it.

Once you  choose an asset allocation,  after that  action is to find  low-priced index funds that fit those allocations.

The  trick is to make sure that the  expenditure ratio of the index fund is under 0.2 %, and you can even  discover a lot of index funds that are much lower than that. If you’re  considering doing index funds for your Roth IRA then definitely download my Roth IRA investing starter kit. It’s  an additional very popular  choice that I did  especially on Fidelity Index Funds.

The 3rd and also most sophisticated way to invest your Roth IRA is by buying individual stocks. At the heart of it, the whole idea when acquiring individual stocks is that you’re attempting to acquire excellent firms at a excellent priceYou don’t want to buy poor companies at a good rate.

  It’s also the most labor-intensive  means to invest your Roth IRA.  There’s a  little bit of a  discovering  contour and it requires you to  type of learn how to read financial statements  and also  study on  private  business when you’re  checking out individual stocks. To buy for your Roth IRA, you would  intend to ask yourself the  complying with  concerns: do I  comprehend this  firm  and also the industry it’s in. Do I understand how this  firm  generates income  as well as do I  also  understand what this company’s  organization  version is  as well as what it takes for it to be successful. 

 

Do 401k To Roth Ira Transfers Count Towards Your Contribution Limit

 Another  inquiry you  wish to ask yourself is: do you want? Do you trust the CEO  as well as the  monitoring  group to do the  best  point? You  likewise  wish to ask  on your own: does this company have good cash flow now  and also in the future,  to ensure that does involve reading the  economic  declarations  as well as  discovering trends and patterns  as well as  thinking of where the  market’s headed in the future? You also  intend to ask yourself: does this  business have too much debt, which is  truly something that  would certainly  jeopardize its ability to  make it through  any type of  type of economic  recessions. A  fast way to tell whether a company has too much  financial obligation or not, is to  take a look at a Ratio called the debt to asset  proportion. 

In general, you want to invest in business that possess two times as much as it is the much more it owes relative to what it owes the better. I talk more regarding financial obligation metrics in my Roth IRA Investing starter kit so certainly a duplicate.

 If you haven’t  currently,  an additional  inquiry you  desire to ask yourself is: can I buy this stock at a  affordable  rate  as well as what’s  practical is  totally  family member?  It’s all relative to how  rewarding the  business is, the  much more profitable a  business is the  a lot more I’m willing to pay to  have that  supply. On the  other hand, the less  successful that  firm is the  much less I’m  prepared to pay to  possess that stock.

  One quick  means to  inform if the  supply is trading on a  affordable  rate is to look at what’s called the p/e ratio or the  rate to  revenues ratio.  Do 401k to Roth IRA transfers count towards your contribution limit.  The rate to revenues ratio is a metric that compares the rate of the supply divided by its incomes per share as well as the lower the p/e proportion, the cheaper the price is about the earnings. The greater the p/e proportion, the higher or much more costly the stock cost is about its profits. Simply put, a low p/e proportion indicates more bang for the buck. Or you’re getting more revenues for each dollar that you pay for that supply.

Again, my Roth IRA, investing starter kit  supplies  in-depth  directions on how to find a  supply’s p/e ratio, as well as  exactly how to  utilize it to  make great investing decisions.

 

Do 401k To Roth Ira Transfers Count Towards Your Contribution Limit

 Now for some  referrals on  just how to go  around  picking which of these three Roth IRA  spending  methods would be best for you. The  3rd option of picking individual stocks  certainly it sounds fun  and also it can be really  rewarding,  however 99 % of people are just  chat here. 

It’s kind of like if you’re  attempting to  reduce weight and you need to choose a diet plan that you would actually  have the ability to do  and also the results  may not be as  attractive or  quick,  yet at least it’ll  function.

 Returning to  spending, you  intend to  select the  approach that you’re  really going to do  and also in most cases, just  buying target-date funds, you’re  mosting likely to  wind up  truly really  rich. If you just do that  regularly, if you’re a  careless  capitalist –  and also you want to  spend the money in your Roth IRA, with as little effort as possible –  opt for target-date funds. Do 401k to Roth IRA transfers count towards your contribution limit.  If your eyes just glaze over at the idea of managing your very own investments as well as trying to find index funds and also rebalancing your portfolio, then do not compel on your own to do something that you do not intend to do.

Life is  as well short for that, so  great deals of people retire millionaires  simply doing target-date funds.  So I  truly  suggest target-date funds for the very kind of lazy, hands-off  capitalist. 

For the somewhat much more DIY financier I recommend index funds. I such as index funds as well as well as for the really DIY investor I recommend learning how to spend in individual stocks.

All of you, type-a  geeks  available,  discover some accounting  terms and do a bit of research  as well as number crunching. For  any person  that  makes the effort to  discover how to  examine individual stocks, it can be really  gratifying.

These are the three really remarkable ways to invest your Roth IRA. Do 401k to Roth IRA transfers count towards your contribution limit.

Do 401k To Roth Ira Transfers Count Towards Your Contribution Limit

A Roth IRA is  totally  ineffective if you  do not,  spend the money in your Roth IRA.  Right here, the  primary  location for financial education I’m  mosting likely to go over  3 of  the most effective Roth IRA investments. Do 401k to Roth IRA transfers count towards your contribution limit. Any one of these investments can and will make you a tax-free millionaire.

Do 401k To Roth Ira Transfers Count Towards Your Contribution Limit

I’m likewise mosting likely to make a referral on how to decide which of these three strategies is best for you. As with numerous things in life, there’s never one appropriate response. Because the most effective investment for you might not be the most effective investment for someone else. Do 401k to Roth IRA transfers count towards your contribution limit.

 I  desire you to be as  enlightened as  feasible so that you can be in  complete control of what  occurs to your money. 

 

 

It makes sense to utilize your Roth IRA for high growth investments, because usually more revenues amounts to more tax obligations, yet not if those investments are inside your Roth IRA. Not just this, however the Roth IRA is a long-term vehicle, so it likewise does not make sense to invest for Passive earnings in your Roth IRA.

 So instead of focusing on passive  revenue in your Roth IRA, why not focus on growth?   This  guidelines out a  great deal of investments, for  instance, Bonds or Money, Market Investments like CDs  and also  brief term Treasuries,  and also  definitely not cash,  since you don’t  desire to  throw away the tax shield of the Roth IRA on investments that return  just one or two percent or  absolutely nothing. 

 

Do 401k To Roth Ira Transfers Count Towards Your Contribution Limit

Assuming you’re not around to retire following year, you desire growth as well as focused investments for your Roth IRA. Allow’s speak regarding the three methods to invest in supplies, for your Roth IRA.

  1. 1. The very first means to invest in your Roth IRA is to buy target-date funds
  2. The second means is to acquire index funds.
  3. The 3rd means is to acquire individual stocks.

  Allow’s go  right into each of these one by one. 

 Without a doubt the  simplest investment for your Roth IRA is  getting target date funds. Target date funds is a mutual fund  which contains  3 to four  various index funds inside it.  Basically, it’s a fund of funds.

 Right here’s a typical  time frame fund  as well as you’ll,  normally see a  residential stock fund, a International stock fund, a  mutual fund  and also  generally a  percentage in a money market or  cash money fund. Do 401k to Roth IRA transfers count towards your contribution limit.  To ensure that’s what a fund of funds appears like.

A 2055 fund is going to be more heavily weighted  in the direction of stocks. Do 401k to Roth IRA transfers count towards your contribution limit.  Its called a 2025 fund, since if you’re intending to retire truly quickly, you don’t have the high-end of awaiting a recovery in the event of a stock market downturn. You’re going to have more bonds, which gives you much more stability and much less in stocks.

Target-Date funds automatically  choose a  mix of investments for you, based on your approximate age,  and after that it  adjusts that  mix of investments. As you  come close to retirement age, if  a lot more Americans  possessed target-date funds during the last  economic crisis, they  actually would have been  far better off.

Do 401k to Roth IRA transfers count towards your contribution limit.  I recognize it’s a delicate subject, however when you hear about people who shed half of their retired life in the 2008 stock market collision, much of them had too much of their portfolio in stocks, offered their age as well as or they either sold every little thing and afterwards completely missed out on the recovery. S, ince it’s any age certain, the name of a target date fund is always mosting likely to have actually a year connected to it.

The Fidelity Freedom Index 2055 funds. Every target date fund has a target retirement year as component of the name, so finding the appropriate one, for you is actually easy.

 Ramit Sethi, a personal  money guru  and also  very successful  writer of “I  will certainly teach you to be rich”,  advises target date funds for the  large  bulk of people. He  discusses  exactly how target-date funds are the  supreme  collection it and forget it investment and they cost a  great deal less than  making use of a robo-advisor. Do 401k to Roth IRA transfers count towards your contribution limit.  Yes, you can accomplish greater returns with other methods like the ones.I’m mosting likely to tell you about a little later on. But these other approaches all call for more work and more initiative. You do not obtain greater returns, putting in much less effort. It’s like even more job equates to a lot more returns.

 That’s why target-date funds are the  sensible  option for  many people. In that sense, target-date funds are a no-brainer investment  alternative for your Roth IRA. 

The second of Roth IRA investments I want to talk about is Index Funds. Do 401k to Roth IRA transfers count towards your contribution limit.  This approach is truly similar to Target Date Funds, other than it’s far more DIY.

The  time frame fund gives you a  total  ideally allocated portfolio in one  good  plan,  yet with index funds. Do 401k to Roth IRA transfers count towards your contribution limit.  You basically would construct that yourself, so you need to choose an asset allocation, that’s right for you and for your age, and after that you require to locate index funds to build that asset allocation.

You would  additionally  require to rebalance your portfolio once the market moves in order to  keep those  portion asset allocations,  along with  maintain your retirement date or your goal date in mind.  As well as readjust your portfolio  in the direction of a  much more  traditional allocation over time.

 It is a little bit  much more work than a target date fund,  due to the fact that you’re  basically going to do yourself what the target date fund  would certainly do for you.  Do 401k to Roth IRA transfers count towards your contribution limit.  The option that is good for you if you want a little more control over your investments, a time frame fund. So for all you type-a, nerds as well as control freaks out there, you’ll most likely wish to do it.

This way, I  directly do index funds in one of my accounts  as well as I  do not do target date funds,  due to the fact that I  directly  intend to follow an asset allocation that isn’t  supplied by  any type of target date funds. The asset allocation model that I follow is one  advised by David Swensen. He’s the legendary portfolio manager of Yale’s, thirty billion dollar endowment fund.

I  discuss him a  whole lot  as well as he recommends allocating percent in domestic  supplies, 15 % in international stocks, 10 % in emerging markets, 15 % in  United States Treasuries, 15 % in  United States inflation-protected Treasuries and 15 % in roths or  property investment trusts.

So this is a portfolio constructed from 6 various index funds, yet if you want to keep it basic, you can also simply duplicate the allocation of a time frame fund. For instance, if you look at the Fidelity 2055 fund that we spoke about earlier, you see that they have 60 % in domestic stocks.They have concerning 30 percent in an International stock fund and the rest of it in bond and money market funds. You can simply replicate that asset allocation and also locate index funds to develop that, and also simply do it on your very own.

Really there’s numerous various asset appropriations you can choose from. There is no one right answer, but you just want to comprehend the advantages and disadvantages of each and afterwards pick something. I chose David Swensen’s asset allocation because I like that it does not have way too many eggs in one basket. Do 401k to Roth IRA transfers count towards your contribution limit.
 Simply put, there’s no  solitary asset  course that dominates the portfolio there’s like at most 30 percent in the  residential  supplies, but  after that everything else is 15 percent in  realty  as well as 15 percent in bonds  and also 15 percent in emerging markets.

This  implies that, throughout  any type of  financial cycle or season  durations of low growth, high growth, low inflation,  reduced and high  rising cost of living, my portfolio is  placed to  profit,  as well as yet it’s still  extremely growth focused  due to the fact that  a lot of it it’s is in stocks.

It’s really simply a fancier variation of the regular asset allocation of many target date funds, for a more in-depth explanation on just how to spend in index funds for your Roth IRA make certain to download my Roth IRA spending starter kit. The pros as well as cons of each allocation, which index funds to acquire and just how much of each index fund to buy.

Once you  pick an asset allocation, then  action is to  locate  affordable index funds that fit those  appropriations.

The  secret is to  ensure that the  cost  proportion of the index fund is under 0.2 %, and you can  also  discover a  great deal of index funds that are much lower than that. If you’re  thinking about doing index funds for your Roth IRA  after that  most definitely download my Roth IRA investing starter kit. It’s  one more  incredibly popular option that I did specifically on Fidelity Index Funds.

 The  3rd  as well as most  sophisticated  means to invest your Roth IRA is by  acquiring individual stocks. At the heart of it,  rationale when buying individual stocks is that you’re  shopping  great companies at a  excellent priceYou don’t  intend to buy  negative companies at a good  cost. Do 401k to Roth IRA transfers count towards your contribution limit.  You don’t want to purchase excellent companies at a negative cost. You wish to buy great business at a great rate. Clearly that’s simpler stated than done, however basically that’s the heart of it and also purchasing individual stocks is the fastest method to develop wide range.

  It’s also the most labor-intensive  method to invest your Roth IRA.  There’s a bit of a  knowing  contour and it  needs you to  sort of  find out  just how to  review  economic statements  as well as do research on individual companies when you’re  considering individual stocks. To  purchase for your Roth IRA, you would  wish to ask  on your own the  complying with  inquiries: do I  recognize this  business  and also the  sector it’s in. Do I understand how this company makes money and do I  also  recognize what this  firm’s  organization model is and what it takes for it to be  effective. 

 

Do 401k To Roth Ira Transfers Count Towards Your Contribution Limit

  An additional  inquiry you want to ask yourself is: do you  desire? Do 401k to Roth IRA transfers count towards your contribution limit.  You additionally desire to ask yourself: does this firm have too much financial debt, which is really something that would certainly jeopardize its capacity to endure any kind of type of economic downturns.

 This tells you how much a  firm owes  about  just how much it owes.  As a whole, you  wish to  purchase companies that own  two times as  long as it is the  a lot more it owes relative to what it owes the better. Do 401k to Roth IRA transfers count towards your contribution limit.  This is just among the metrics you might check out to see if a business has too much financial debt. I chat a lot more concerning debt metrics in my Roth IRA Investing starter set so most definitely a copy.

 If you  have not  currently, another  inquiry you want to ask yourself is: can I buy this  supply at a  practical  cost  and also what’s  practical is  totally  family member?  It’s all  about  exactly how  successful the  firm is, the  much more  lucrative a company is the more I’m  ready to pay to  possess that  supply. On the  other side, the less  rewarding that  firm is the  much less I’m  prepared to pay to own that stock.

  So one  fast  means to tell if the stock is trading on a  practical  rate is to  consider what’s called the p/e  proportion or the  cost to  revenues  proportion.  Do 401k to Roth IRA transfers count towards your contribution limit.  The cost to profits proportion is a statistics that contrasts the cost of the supply divided by its revenues per share and the reduced the p/e ratio, the less expensive the price is about the profits. The greater the p/e ratio, the higher or much more expensive the supply price is relative to its profits. In other words, a low p/e ratio suggests more bang for the buck. Or you’re getting even more earnings for every single dollar that you pay for that supply.

Again, my Roth IRA,  spending starter  package  gives  comprehensive  guidelines on how to  discover a  supply’s p/e  proportion, as well as  just how to  utilize it to  make great investing decisions.

 

Do 401k To Roth Ira Transfers Count Towards Your Contribution Limit

  Currently for some  referrals on how to  tackle choosing which of these three Roth IRA  spending strategies would be best for you.  You want to be  reasonable  concerning what you’re  really going to do.  There is  absolutely nothing more  pointless than an  outstanding investing  method that you’re not going to  follow up with.  The  3rd option of  selecting individual stocks  undoubtedly it  appears fun  and also it can be really  rewarding,  yet 99 % of people are just talk  below.  They don’t have the time or the  desire to put in that  sort of work. 

It’s  sort of like if you’re trying to  drop weight and you need to  select a diet  strategy that you would  really  have the ability to do  and also the  outcomes might not be as  attractive or  quickly,  however  a minimum of it’ll work.

 Returning to  spending, you want to  choose the strategy that you’re actually  mosting likely to do  as well as  in many cases, just investing in target-date funds, you’re going to  wind up really  actually  well-off. If you just do that consistently, if you’re a lazy investor – and you  intend to invest  the cash in your Roth IRA, with as little effort as possible –  select target-date funds. Do 401k to Roth IRA transfers count towards your contribution limit.  If your eyes just glaze over at the thought of handling your very own investments and seeking index funds and also rebalancing your portfolio, then do not force on your own to do something that you don’t want to do.

Life is too short for that, so  great deals of  individuals retire millionaires just doing target-date funds.  I  actually  suggest target-date funds for the  actual kind of lazy, hands-off investor. 

For the slightly more DIY capitalist I recommend index funds. I like index funds as well as well as for the very DIY financier I recommend learning exactly how to spend in individual stocks.

 Every one of you, type-a nerds  around,  find out some accounting terminology  as well as do a bit of research  and also number crunching. For  anybody who  makes the effort to learn how to  examine individual stocks, it can be  actually  fulfilling.

These are the 3 actually remarkable methods to spend your Roth IRA. Do 401k to Roth IRA transfers count towards your contribution limit.