So if I simplify a bit, the priority, given availability would be Roth 401(k) (or similar other plans), then traditional 401(k) (as these two would be matched by the employer, up to certain percentage), up to the limit (seems to be USD19k for both combined).
The priority is really to collect every dollar of employer matching funds. Past that (past the employer's matching fund limit), it doesn't particularly matter whether you're contributing to the employer's plan or to your own IRA since the tax advantages are the same. The IRA is more flexible because everything your U.S. broker offers is available, which is a vast selection. Most 401(k) and 403(b) plans offer very good, low cost investment choices nowadays, but the choices are more limited and sometimes they're questionable.
The annual 401(k) and 403(b) plan contribution limit is now US$19,500 (2020 figure), excluding the additional amount that workers age 50 and older are permitted. Also, the Roth variant of the 401(k) or 403(b) plan, if offered, effectively allows a higher contribution since the same contribution limit applies.
Pro tips: If you start getting employment income mid-year, and if you can afford it, see if you can temporarily raise your 401(k) or 403(b) plan contribution percentage in order to hit or at least get near the annual maximum. Also, if your employer's plan offers a "match maximizer" or similar mechanism, you'll probably want to use that feature.
OK, so to recap, I'd do it in this priority order of dollars available for saving:
1. Max out the employer's matching funds in the 401(k) or 403(b) plan (using the Roth variant I suggest);
2. Max out your IRA contribution (Roth variant again I suggest);
3. Max out the remainder of the 401(k) or 403(b) plan limit. (The Roth variant effectively allows a higher limit than Traditional since Roth contributions are after tax.)
4. If you want to get
really "crazy" then some 401(k) and 403(b) plans let you contribute above US$19,500 per year to a separate subaccount, which I think is treated as nondeductible (after tax). Once you separate from the employer you're then generally allowed to roll that particular nondeductible subaccount over into your own Roth IRA, paying income tax at that time on the gains only (and at ordinary income tax rates, not at preferred capital gains rates, as I recall). Once in the Roth IRA, it's U.S. tax free thereafter (assuming no premature withdrawals). So this subaccount, if offered, effectively allows you to bust the $25,500 per year contribution limit. There's some higher aggregate 401(k)/403(b) limit that applies in this case, but I think it's $5X,000 per year, so potentially using this path if it's offered you could stuff another $3X,000 per year into a Roth IRA, eventually. I managed to take advantage of this "hack," and it was/is lovely, for me anyway. "Your mileage may vary."
And then after reaching the limit for those, I'll contribute to Roth IRA, and then traditional IRA (USD6k combined limit, and the Roth version is only available for those earning up to USD139k/year).
Not actually. There's something called a "Backdoor Roth IRA," and it works like this:
1. Make a nondeductible, Traditional IRA contribution.
2. Invest the funds in something safe for a couple months, like a U.S. T-Bill or short-term U.S. Treasury fund.
3. After the couple months, convert the whole Traditional IRA to a Roth IRA. Invest your Roth IRA (and other tax advantaged accounts) in the most aggressive vehicles within your total wealth. (That's a basic principle of tax advantaged accounts, to put the long-term highest yielding stuff within them to max out the tax advantages.)
4. If your $6,000 contribution turns into $6,005 (let's suppose) by the time you convert to a Roth IRA, then you'll report $5 of income on your tax returns and pay tax on that.
For some weird reason there's an income limit for direct Roth IRA contributions but no income limit for
nondeductible Traditional IRA contributions and no income limit for Traditional IRA to Roth IRA conversions/rollovers. You'll need to make sure that you convert
all Traditional IRA funds and have no other Traditional IRAs. (This doesn't really work for people with lots of funds in Traditional IRAs that have appreciated.) But since you don't have any IRAs now this part is easy.
These would all add up to a maximum of USD25k tax advantaged investments in a year, and anything on top of that could be placed in non-tax advantaged accounts such as my IBKR for example. Would that be correct?
US$25,500 (2020 figure, under age 50) per year, to be precise.
Note that 401(k) and 403(b) plan contributions are calendar year based, but you have until April 15 of the following year to make IRA contributions for the previous year. I wouldn't wait that long, though. Once you know you qualify for an IRA contribution (have enough "W-2 income"), I'd go for it. And of course don't wait that long to open the IRA and deposit a dollar if that's what's required to open it. The IRA account opening process probably isn't instantaneous.
Yes I'm aware of state/city taxes, though I wonder if this would be dependent on the location of the company/organization I'm interning/working for, or my address of residence? (e.g. if I stay in Princeton but work in an NYC-based firm)
Yes.
That's a bit complicated, actually, but if you're a "cross border" worker the various tax authorities have rules about how that all works. I believe the basic, typical rule is that you pay the workplace's income tax jurisdiction(s) first, then you pay the tax jurisdiction covering your place of residence if there's any additional income tax owed (if your place of residence has a higher tax rate on that income and you need to pay the difference).
Regarding H-1B1 status (you'll be H-1B1 as a Singaporean citizen, I assume) -- or really any visa status or even undocumented/non-status (staying without permission; don't do that) -- the IRS applies something called the "substantial presence test" to determine whether your worldwide income and assets are subject to U.S. tax jurisdiction or not. So just take a look at that test and try to position yourself better in the calendar year preceding the calendar year when you cross that "substantial presence" threshold. If you fall in love, marry an American, get a green card (permanent residence), and live happily ever after, then you definitely cross the threshold.
So I went to Allianz Singapore website and looked around for a bit, these highlighted parts are probably what I should be looking out for right?
Highly preferably you want "unlimited" next to the emergency medical coverage line, which Allianz Singapore offers in their single trip "Gold" plan for example. Unless the number is a stonking big number, like 8 digits big, which is probably OK for these purposes.
Versus the sample quotation you provided Bupa Global's base annual plan (British pound price) is less expensive, actually, and would work fine as long as your pre-insurance stay entirely fits within their maximum trip length.
Your Aetna (or similar) U.S. insurance policy, once you're covered and stay covered, probably works pretty well for your international travel outside the U.S. -- for a vacation in Canada, Europe, or wherever. U.S. private medical insurance almost always covers emergency medical care outside the United States, and happily so since it's so much less expensive. Check the policy terms, of course, but that's pretty typical. Less common is medical repatriation coverage, but sometimes even that is covered.
Edit:If we assume that I'm going to be away from Singapore for a few years, would it make sense (or is it even possible) to downgrade to the lowest integrated shield plan (GE supremehealth standard), drop the rider completely, just to prevent the existing condition from resetting, and then upgrading it back to private and getting a new rider when I return to Singapore?
I wouldn't go that low. At your likely age the "as charged" public hospital B1 plan (Supreme Health B Plus) is going to be within a very few dollars of the Standard Plan. The TotalCare Classic rider (lowest cost rider) for that B Plus plan is fine, too. Preexisting condition exclusions apply to both the base plan and the rider, so if you drop the rider completely (for example) then you have to assume you might not get back in.
The basic issue here is that, as a Singaporean citizen (I assume) you've got one country where you have an unambiguous, firm right of abode: Singapore. So you have to presume that you'll be coming back to Singapore until two things are true: (1) you have a firm right of abode elsewhere, and (2) you intend to stay in that other country. And if you're inevitably coming back to Singapore (you must presume), then do you want to come back with only MediShield Life due to preexisting condition exclusions? I vote no, personally, so I'd maintain the next sensible level of coverage above MediShield Life, which in your case would be Great Eastern's Supreme Health B Plus and TotalCare Classic rider -- a very fine combination for Singaporean citizens/best in class, actually. At your age (guessing) this combo is quite affordable, and you have perfectly respectable coverage if/when you land back in Singapore, with or without new preexisting conditions.
I presume your suggestion to keep the basic rider and downgrading to B/A plan is to cover in case I choose to get hospitalized in Singapore, rather than in the US using my university insurance?
It's really about the future and the way preexisting condition exclusions work (really don't work) in Singapore.
In anticipation of Integrated Shield plan premiums during your U.S. sojourn, check your MediSave balance. If it's in good shape, great, but if it could use some more dollars, if you could use the tax relief, and if you have room below the CPF Annual Limit, give some consideration to topping up your MediSave Account.
Oh, one other thing: if you can record nontrivial U.S. Social Security contributions within 10 calendar years, i.e. at least 40 "credits," then you'll qualify for future U.S. Social Security retirement benefits plus potentially some other benefits. If you're at the 3 year mark and decide you've had enough, OK, fair enough. On the other hand, if you're at the 8 year mark and trying to decide whether to head back or not, see if you can hang on to get those magic 40 credits -- and count carefully. It'd be really terrible to end up with 39.
In the year 2020 you need US$1,410 of U.S. Social Security taxable income (earned income, a.k.a. "W-2 income") to earn one Social Security credit. The maximum you can earn within a calendar year is 4 credits, and US$5,640 (4X 1410) will do it. Each year this figure is raised a bit for inflation. As you can see, if you start work in October and earn US$7,000 for 2020 (let's suppose), that's enough to clock all 4 credits in 2020. Likewise, if you leave in March, 2029, after clocking US$9,500 of earnings in 2029 (let's suppose), that should be enough for all 4 Social Security credits that year. So you can get to the magic 40 credits with as little as 8-point-something years of work, and with short periods of non-work interspersed. (Hypothetically as few as 10 paychecks will do it, if the paychecks are each big enough and each is within a separate calendar year.) If you hit at least 6 credits and then head off to Germany (for example, one of the many Social Security treaty countries) and work 8+ years there, contributing to their social insurance system, then U.S. Social Security can "totalize" your contributions into the German system in order to qualify you for U.S. benefits, and potentially vice versa (Germany counting your U.S. credits toward minimum qualification).
....OK, I'll stop there.