Submitted by GlitterInfection t3_11y2mnx in personalfinance
My boyfriend is moving in end of next month. I make approximately 8-9x as much money as he does. I own the condo we are going to be sharing soon and he's leaving a rent controlled room in a roommate situation where he pays about $1000 for his share of things.
Instead of having him pay that rent to me I've asked for him to split the amount and pay half of it to an IRA and give me half for which I'll do the same. The idea is that if we don't get married, his time with me will leave him in a better financial situation than had he stayed in his apartment, but if we do get married then the retirement accounts become money for us both.
The question I have is, assuming we get married which is better for him to contribute to now, a Roth IRA or a traditional? I assume Roth for as long as we can before we marry but I get lost at backdoor-ing and pro-rata-rules and the like.
Edit: Thanks for all the advice and kind comments!
To clarify, this would be splitting $1000 rent into $500 he keeps in a retirement account and $500 I do. He was anxious about leaving his rent controlled apartment and this was something I came up with that he also thinks is a good idea. We both gain from it financially no matter what happens.
I don't quality for a Roth without doing the backdoor route. Presumably when we marry he also won't qualify any longer.
We aren't engaged but we are both in alignment on what we want. We plan to meet with a financial advisor before marriage and will likely arrange a (fair) prenup. We've discussed all of this together already. It's probably a couple years out, since we are just moving in together.