From My understanding ,a Roth is funded with After tax money and not taxed when withdrawn,Even the gains are not taxed.

Roth 401(k), and 401(k) are both employer-sponsored investment savings account plans. In 401(k) plan, you contribute in a pretax basis and earning acrrued on a tax deffered basis. When withdrawing money at 591/2 years of age, you will pay income tax. While the Roth 401(K) plan, your contribution will be after tax, and when 591/2 years old, you dont have to pay income tax of the money withdrawn. It is really a good idea to use both plan, if your company have 401(K) and Roth 401(K), put equal amount of contribution. The total maximum amount of both plan as of 2011 is$16,500. or $22,000. for 50 years old or older. Example; Roth 401(K) $8,250. and $8,250. to 401(K) , for a total of $16,500.Your employer will contribute or match your contribution in a pretax basis, that`s why you still need the regular plan or the 401(K) to capture all the free money.

Thank you very much domingo506. I have been trying to understand this for quite a while. You are the first person who has explained it in a way in which I could understand it.