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Why Consider a Roth Conversion?

November 2, 2019

If you believe, like we do, that federal income taxes will be higher down the road than they are today, then you run the chance of paying more taxes down the road when you retire than today. So, one of the things that we have been talking a lot about is Roth conversions. Does that make sense for you today? To purposefully take money out of your pre-taxed accounts, traditional IRA’s, 401K’s and not spend the money, but purposefully take the money out and convert it into a Roth so that you eliminate RMD’s on any amount converted and all the money in the Roth is tax free for the rest of your life. Does that make sense?

And so, that’s something we look at and talk about with every single person that walks through our door. Now might be the best time in the last 100 years to purposefully pay taxes on your pre-taxed, qualified retirement accounts and get those funds into a Roth. Taxes are on sale and we need to seriously look at this between now and 2025 while the tax code is in its current form.