Terry Savage: Roth conversions — a good idea?

Terry Savage: Roth conversions — a good idea?

Would you send the government a big check this year — in return for a potentially far larger future tax break? That’s the simple and essential premise of Roth conversions — paying taxes now on regular IRAs, 401(k)s and other tax-deferred retirement accounts (except those from your current job) in exchange for tax-free withdrawals of those balances, plus all their growth, down the road. Many Americans have spent the last 40 years growing tax-dedu…

Five Strategic Times For Roth Conversion

When planning for retirement, Roth conversions can offer a powerful strategy for long-term tax savings. Converting a traditional IRA to a Roth IRA means paying taxes upfront but benefiting from tax-free growth and withdrawals in retirement. However, the timing of the conversion is crucial, as it impacts the overall tax liability and your future financial flexibility. In this article, we explore the pros and cons of Roth conversions and the five …