A Roth account is a type of individual retirement account (IRA) that is funded with after-tax dollars. This means that the money you contribute to a Roth account has already been taxed and you will not receive a tax deduction for your contributions. However, the money you contribute to a Roth account grows tax-free and you can withdraw your contributions and any earnings on them tax-free in retirement.
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Want to retire in your 50s and withdraw from savings? You need to understand the Roth 5 year rules to avoid penalties. The post Understanding the Two Roth 5-Year Rules: A Key to Smarter Early Retireme...
Answering reader questions on the Backdoor Roth IRA and the Mega Backdoor Roth, including what the Mega Backdoor Roth is, who it makes sense for, and how to make the most of it. The post Backdoor Roth...
Converting at least some of an old 401(k) to a Roth IRA can offer long-term tax benefits and retirement flexibility, especially if you anticipate being in a higher tax bracket later or wish to leave a...
I was advised and I am following through with a near-complete conversion of my tax-deferred assets to a Roth IRA prior to age 72 when RMA's should begin. I mention "near-complete" because I'm leaving ...
If you have a significant amount in tax-deferred retirement accounts, you could be sitting on a tax time bomb. Luckily, there's a way to defuse the situation....
Exploring the Backdoor Roth IRA? Don’t get burned by the Pro-Rata Rule. Here’s how it works and what to do if you have a Rollover IRA....
You don’t have to choose just one. Life insurance and Roth IRAs can work in tandem to provide retirement income....
So I'm looking to start ROTH conversions once I retire in 2 years (at 62). I'm hoping to lower overall taxes in my lifetime, eliminate or reduce taxes for my heir (my kid), avoid forced RMD's (and inc...
Converting now would enable you to spread a possible tax hit over more than one payment while reducing future taxes....
If you make above a certain income, expect to pay more for Medicare, unless you take steps to lower your income. Here's how....
Ryan in Texas is in the 32% tax bracket. Where should he save for retirement so he’ll be in a lower bracket? Should Weronika in Texas pay the taxes now to convert to Roth for lifetime tax-free g...
Ralph and Alice in Monument, Colorado have $4.6 million dollars saved at ages 63 and 58. Should they do Roth conversions? How do they avoid IRMAA? Mary Jo in Escondido, California wonders if she shoul...
Converting your traditional IRA to a Roth can be a fantastic tax-saving move, but you've got to be smart about two things: how much and when....
How to maximize the tax free income from your ROTH IRA today. Several valuable tax planning strategies to reduce your taxes on retirement income....
Understanding the nuances of Roth conversions can help you avoid forking over more money in taxes than you need to....
Answering reader questions about the Mega Backdoor Roth, the regular Backdoor Roth IRA, and IRA rollovers. We also talk about high-yield dividend funds and answer a question about asset allocation and...
I am 58, retiring at 60. Have been deep down the rabbit hole on Roth conversions as I am 75% (1.4M) deferred, plus another 450K inherited IRA....got on the Roth accounts late, and was high income. I u...
A fundamental strategy for any U.S.-based DIY retirement planner is to accumulate as much retirement money as possible in a Roth IRA. Roth IRA contributions and conversions grow tax-free, and withdraw...
This financial planner unpacks why Roth conversions can save you big-time on taxes if you're a retiree with a pension....
The potential for tax-free growth makes Roth IRAs an attractive option for younger savers who have decades to maximize investments....
All of the traditional logic and advice points to Roth conversions being critical to optimize taxes and control RMD's later in retirement. But with our desired retirement lifestyle of spending for exp...
John in Boston is in the 32% tax bracket. Should he do Roth conversions? Flight Deck Dad and Irish Girl in Pensacola have a lot of tax-free pension income. Should they do Roth conversions? Bert and Er...
Answering reader questions with WCI friend and Roth IRA expert, Chris Davin, where we talk about when to choose Roth and why, Roth and tax-planning considerations, and using Roth as an independent con...
What are the pros and cons if Chip uses the money in his taxable brokerage account for early retirement income? Jack and Sally ask Joe and Big Al to spitball on whether they can retire around age 55 o...
Understanding the allocations in your Roth IRA can help manage volatility and set realistic expectations for long-term returns....
Just about every week here on YMYW, Joe and Big Al talk about converting your retirement savings to Roth accounts. But why? What’s the big deal? Today the “IRA guru” Ed Slott, CPA re...
Thinking of converting a traditional IRA to a Roth IRA? The Kiplinger Tax Letter Editor highlights nine factors you should consider before making a move....
Tuesday, April 01 - Monday, April 07, 2025 Most Commented score comments title & link 94 147 comments How financial advisors treat couples 12 41 comments Help with our first ROTH conversion Top Co...
Here's everything you need to know about Mega Backdoor Roth conversions and whether they're the right move for you in the long run. The post Mega Backdoor Roth IRA Conversion in Your 401(k) or 403(b) ...
You could do more harm than good if you react emotionally to volatility. Instead, consider tax-loss harvesting, Roth conversions and how to plan for next time....
Looking for opinions on what to do with the money. I am the higher earner of the 2 of us, aged 57, spouse is retiring as a teacher at 56. Getting about 250K lump sum in exchange for a lower COLA incre...
Answering reader questions about the difference between Roth and traditional IRAs, the process of opening Roth IRAs for your kids, and what to do if you over-contribute to your 401(k). The post Roth I...
"Jim" (66) and "Karen" (64) both retired in the last six months. Jim has an IRA with $900,000, and Karen has a Roth IRA with $300,000. They inherited a brokerage account with $600,000 and a cost basis...
I understand the basics (5 year rule, paying the taxes, etc.), but does it mean I'm basically "buying" with money from my traditional IRA? Let's say I want to convert $50K. My $50K is now worth $40K (...
While some 'golden rules' stay in style forever, the financial landscape is constantly evolving. Here are five common myths to revisit (with more on the way)....
Facing a future tax hit on your retirement savings? A Roth conversion may be a way to lower the taxes you owe....
Strategic Roth IRA conversions can set you up for tax-free income in retirement and a tax-free inheritance for the people you love....
That 401(k) or traditional IRA you've filled with your hard-earned money could turn into a tax bomb. Before it blows, see if a Roth could help rescue you....
Planning for retirement is crucial, especially for those self-employed or anyone without an employer-sponsored retirement plan. A Roth solo 401(k) might be the solution....
If available, you may be able to access additional Roth savings annually. However, there are important considerations for employers and employees to keep in mind....
An IRA conversion can give you a leg-up in retirement with tax-free income. But proceed with caution....
Converting a traditional IRA account to a Roth IRA is a fabulous part of a proactive tax-planning strategy to reduce the tax drag on your retirement income....
Get 6 surprising takeaways from Boldin's recent survey of users about Roth conversions. The post Strong Engagement & High Confidence: What Boldin’s Survey of Users Reveals About Strategizing...
To read this story on KSL.com, click here. Millions of Americans are converting their traditional tax-deferred IRAs and 401Ks into tax-free Roth accounts. CNBC reported last year that Roth conversions...
You may not be bound for Mordor, but Roth IRA pitfalls could upend your retirement if you're unaware of them....
If your child has earned income, they can contribute to a Roth IRA. Opening a Roth IRA for kids can significantly change their financial situation in retirement....
Roth IRAs are a great way to build tax-free retirement income—but the withdrawal rules can be tricky. In this video, I’ll break down the five-year rules, how contributions, conversions, an...
The most complicated routine question for investors is the annual dilemma about Roth contributions and conversions. Here's what to know. The post Should You Do a Roth Contribution or Conversion? appea...
You should check out the mega backdoor Roth tax-planning strategy. The huge life time tax savings can improve the health of your retirement income....
Retirement savings and taxes are a minefield — and the higher your income, the more complicated the options. Use these tips to find your way forward....