Should I Convert My Retirement To Roth?

[@CliveBirse]

Investing in a Roth IRA is a smart choice because contributions grow tax-free over time, and withdrawals in retirement are tax-free. This allows you to keep more of your hard-earned money. Starting early maximizes the benefits of compounding, where your investment grows exponentially by earning interest on both the initial amount and the interest it accrues.

[@mariaguerrero08]

Effective personal finance management is more important than the amount of money saved, regardless of whether income is earned through job or investment. Individuals can seek counsel from a certified financial advisor to optimize financial outcomes, who can provide specialized advice and methods to decrease expenses and maximize income.

[@ThomasChai05]

I completely agree; I am 60 years old, recently retired, and have approximately $650k in external retirement funds. I am debt free and have very little money in retirement funds compared to the total value of my portfolio over the past three years. To be honest, the Fin-advisor can only be neglected, not rejected. Just do your due diligence to identify a fiduciary one.

[@mikegarvey17]

@@ThomasChai05This is exactly how i wish to get my finances coordinated ahead or retirement. Can I get access to your advisor?

[@ThomasChai05]

My CFA ’Izella Annette Anderson’ , a renowned figure in her line of work. I recommend researching her credentials further. She has many years of experience and is a valuable resource for anyone looking to navigate the financial market.

[@Grace.milburn]

This is useful information; I copied her full name and pasted it into my browser; her website popped up immediately and her qualifications are excellent; thanks for sharing.

[@clarkstephen7861]

Accept people laughing at your $0.50 dividends, Stick to the process and accumulate more shares,Laugh at them for not understanding how compounding works.

[@RoseGuerra7862]

My first dividend was less than $1, but it provided me with the framework to get to enough in dividends to cover expenses.Once you get that first one, you get hooked.

[@martinheaway]

Investing in stocks can be a wise decision, especially if you have a dependable trading system that can lead to successful outcomes. Personally, I've been working with a financial advisor for about a year now. Starting with less than $200K and I'm now just $19,000 away from making half a million in profit.

[@JaneClark7861]

That's incredible. Could you recommend who you work with? I really could use some help at this moment.

[@martinheaway]

My CFA Amy Desiree Irish a renowned figure in her line of work. I recommend researching her credentials further... She has many years of experience and is a valuable resource for anyone looking to navigate the financial market

[@JaneClark7861]

Just ran an online search on her name and came across her websiite; pretty well educated. thank you for sharing.

[@KennedyVerbruggen]

I just switched up my Roth IRA to 50% SCHD, 25% SCHX, 25% SCHG, and my Roth 401k is 70% vanguard S&P 500 index, 20% vanguard growth index, and 10% vanguard international index. Seeking best possible ways to grow $350k into $1m+ before retirement in 3 years.

[@NorthCarolinaForward]

Safest approach i feel to tackle it is to diversify investments. By spreading investments across different asset classes, like bonds, real estate, and international stocks, they can reduce the impact of a market meltdown. its important to seek the guidance of an expert

[@SavannahMitchell-b3d]

It's true that many people underestimate the importance of advisers until their own feelings burn them out. A few summers ago, following an ongoing divorce, I needed a significant push to keep my company afloat. I looked for licensed advisors and found someone with outstanding qualifications. She has contributed to my reserve increasing from $275k to $850k regardless of inflation.

[@antoniaribeiro8073]

How can I participate in this? I sincerely aspire to establish a secure financlal future and am eager to participate. Who is the driving force behind your success?

[@SavannahMitchell-b3d]

Rebecca Nassar Dunne is the licensed advisor I use. Just search the name. You’d find necessary details to work with to set up an appointment.

[@KatyaSantos-g4c]

Thanks a lot for this suggestion. I needed this myself, I looked her up, and I have sent her an email. I hope she gets back to me soon.

[@FeelMyTruth]

The concept of mini-retirement changed my life. I'm no longer waiting for some retirement paradise when I'm 65. It helps to know how to fund the lifestyle. You know, making money while you sip that piña colada by the beach does help. I wouldn't have been able to do it otherwise.

[@cloudyblaze7916]

Yeah, people miss that part. You don't jet out to Puerto Rico with your life savings. Proper investing and a good business acumen are big pluses. Invest in the stock market, real estate, build businesses. That's just it.

[@mohican-jx6fx]

Safe to say not everybody has the skill to pursue investing. But it's always easy to follow the advice of someone who knows how to i.e a financial advisor. You could anywhere between 10--40k with the right ones. Online businesses are a good bet too if you are savvy.

[@ericmendels]

I think most people want to try out a financial advisor, but the amount of information on the internet is overwhelming. Could recommend any good one(s)?

[@mohican-jx6fx]

Yes, it feels overwhelming when you are starting out, but with time you'll find your foot. I personally suggest sticking with one who understands your goals. I'll recommend *Sharon Lynne Hart* because I work with her and you could check her website out, but I'm sure there are other good ones, too.

[@JannyLuits]

VGT outperformed SCHD and VOO over 5 and 10 years. Despite having most of my $500k retirement in VGT, I try to beat my Roth with my taxable account but still underperform the S&P 500.

[@Justinmeyer1000]

I'm taking a hybrid approach with VGT, SCHD, and VOO as my foundation over a 20-year horizon. I still enjoy life, travel, and buy what I love. It's the best combo, plus I enjoy the small victories of dividends, dividend growth, and share price appreciation.

[@carssimplified2195]

ETFs are great, but don't rely solely on it for retirement. I retired at 62 with a $1.5M portfolio, starting with $35K, thanks to an adv1sor and dividends. Invest wisely, build your nest egg, and don't sell the chicken that lays the egg!

[@PatrickFitzgerald-cx6io]

Who is this person guiding you and how can i reach he/she?

[@carssimplified2195]

I'm very cautious about giving specific recommendations as everyone's situation varies. Consider independent financial advisors like "Aileen Gertrude Tippy" I've worked with her for 9 years and highly recommend her. Check if she meets your criteria.

[@PatrickFitzgerald-cx6io]

Thanks a lot for this suggestion. I needed this myself, I looked her up, and I have sent her an email. I hope she gets back to me soon.

[@NicholasBall130]

Investing in Roth IRA can be a good choice since they are funded with after tax dollars, your contributions can grow tax-free over time. When you withdraw money from your Roth IRA in retirement, you won’t have to pay tax on it, which will help you keep more of your hard-earned money. I retired with 5 million dollars

[@StacieBMui]

On the contrary, even if you’re not skilled, it is still possible to hire one. I am a project manager and my personal port-folio of approximately $750k took a big hit in April due to the crash. I quickly got in touch with a financial-planner that devised a defensive strategy to protect and profit from my port-folio this red season. I’ve made over $150k since then

[@StacieBMui]

Credits goes to " Sonya lee Mitchell" one of the finest portfolio managers in the field. She's widely recognized; you should take a look at her work.

[@lolitashaniel2342]

I searched her up, and I have sent her an email. I hope she gets back to me soon. Thank you

[@alanpedrick1562]

You get taxed either way, it seems you don't know how the math works. It comes down to tax bracket differences and nothing about how it grows.

[@mgdiaz2158]

When you convert to a Roth IRA you have to pay taxes on the amount you convert, so if you have $100.000 to convert, and your taxes bracket is 24%, you'll pay $24,000 in taxes, so your conversion is $76,000 and you have to come up with that money to pay that tax bill

[@TheJackCain-84]

I believe the retirement crisis will get even worse. Many struggle to save due to low wages, rising prices, and exorbitant rents. With homeownership becoming unattainable for middle-class Americans, they may not have a home to rely on for retirement either.

[@JacquelinePerrira]

Got it! Buying stocks during a recession when prices are down could be a good move. You might get them at a lower price and sell later when they go up. Just do your homework and be aware of the risks before diving in!

[@kevinmarten]

That's awesome! Investing in stocks with a reliable trading system can lead to great outcomes. It's fantastic that you've been working with a financial advisor for a year now. Starting with less than $200K and being just $19,000 away from making half a million in profit is impressive! Keep up the good work!

[@Jamessmith-12]

Mind if I ask you to recommend this particular coach you using their service?

[@kevinmarten]

Carol Vivian Constable is the licensed fiduciary I use. Just research the name. You’d find necessary details to work with a correspondence to set up an appointment..

[@Jamessmith-12]

She appears to be well-educated and well-read. I ran a Google search for her name and came across her website; thank you for sharing.

[@philipfletch]

I just switched up my Roth IRA to 50% SCHD, 25% SCHX, 25% SCHG, and my Roth 401k is 70% vanguard S&P 500 index, 20% vanguard growth index, and 10% vanguard international index. Seeking best possible ways to grow $350k into $1m+ before retirement, I'm 55.

[@NatashaJoy7861]

Your allocation looks solid. Consider dollar-cost averaging & dividend reinvestment. I suggest you consult with a financial advisor for guidance.

[@martinheaway]

Accurate! asset allocation is crucial with an Experts guidance. I have 850k in equity, 300K cash earning 5.25 interest, 685k in 401k, 250k cash account, 120k in car assets ( paid off cars) Gold and silver bars. age is 48. My advisor helped me realign my portfolio to my risk tolerance and it boomed overtime.

[@JaneClark7861]

That's incredible. Could you recommend who you work with? I really could use some help at this moment.

[@martinheaway]

Amy Desiree Irish is the advisor I use and am just putting this out here because you asked. You can Just search the name.

[@JaneClark7861]

She appears to be well-educated and well-read. I ran an online search on her name and came across her website; thank you for sharing.

[@AddilynTuffin]

Increasing tax rates are the reason I rolled over my 401k to a Roth. I don’t want to be 59 paying taxes on current income on withdrawals made from my retirement account. I'm now seeking best possible areas or ways to gain wealth in today's economy.

[@Dollrnri]

Pre-tax contributions may help reduce income taxes in your pre-retirement years while after-tax contributions may help reduce your income tax burden during retirement.

[@JordanReam8186]

Both have their perks but you can also save for retirement outside of a retirement plan, such as in an individual investment account or employing the services of a retirement planner/investment advisor.

[@Redwood4040]

Private investing is the best way to go about the market right now, especially for near retirees, I've been in touch with a wealth manager, netted 370K the last downturn, made it clear there's more to the markets than we average joes know.

[@NO-TIME170]

Well it seems like a lot of your interest is riding on your source, I could really get well accustomed to your viewpoint, get me involved.

[@Redwood4040]

I've stuck with ‘’Victoria Louisa Saylor ” for years now, and her performance has been consistently impressive. She’s quite known in her field, look her up.

[@GibsonJames-gr3on]

My retirement account has gone down by 13.7% in the past year due to rebalancing I did out of fear uncertainty and doubt. What are best alternatives to take in other to secure a financially free retirement and achieve ultimate peace? I don’t want to fail after years of working hard.

[@OwenFlex]

If you want to rebuild your portfolio by yourself, without help, I will tell you it is near impossible. Even NewRetirement and co can’t do the job of an FA with expertise, a large following/client base and experience. Vet and hire one and begin to develop a rapport.

[@RoseBalerus]

You honestly should hire a private advisor, they are reliable. Look up online for a for one, That way you have an expert perspective and contributions

[@GibsonJames-gr3on]

How can I get with someone like that?

[@RoseBalerus]

*JOSEPH NICK CAHILL*

[@RoseBalerus]

He is very well known in the financial sector. He not only understands the intricacies of the stock market, retirement planning and real estate but also has insights into navigating the financial sector for potential gains.

[@BrewerVera]

I am 27 and i just started my ROTH IRA and deposited the max for 2024! I feel stupid for how long it took to get my life straight. The problem here is, what is the best way to invest the money to grow to $1 million for retirement?

[@Raymondcraw1967RaymondCrawley]

I believe every Investor should start with ETFs for a solid foundation, then diversify across asset classes and maintain disciplined, regular investing to minimize risks and maximize growth.

[@fredrickmcgraw9491]

You don't need to find the next NVDA to succeed in investing. Just choose top-notch ETFs and partner with a financial advisor like I did. I turned $100k into $20,000 in annual dividends-a significant milestone for me today.

[@VanessaWilliams-pu8vt]

Impressive! I admit I'm scared about retirement as I turn 60 on my next birthday. I need to ensure I have enough money to survive on. How can I consult your advisor? My retirement account isn't performing well.

[@VanessaWilliams-pu8vt]

Thanks for sharing. I curiously searched for her full name and her website popped up immediately. I looked through her credentials and did my due diligence before contacting her.

[@OvaltineJenkinsFx]

Please be careful soliciting this advice from random people on the internet. Dave has a place on his website where you can sign up for a financial coach, or a financial advisor called a Smartvestor Pro. Or you can find your own advisor. Dave’s books also outline basics of how to diversify your portfolio, I’d start there.

[@AndersonFair-cy2bb]

I am currently in my 50s and This is no time to taper retirement savings. I want to max out my retirement contributions and I also have another $200k in a savings account that i want to invest in a non-retirement account. Where should I invest it now?

[@RoseGuerra7862]

Safest approach i feel to tackle it is to diversify investments. By spreading investments across different asset classes, like bonds, and international stocks, they can reduce the impact of a market meltdown. its important to seek the guidance of an expert

[@martinheaway]

A good number of people discredit the effectiveness of financial advisors in exploring new markets, but over the past 10years I’ve had a financial advisor consistently restructure and diversify my portfolio/expenses and I’ve made over $1.2m in gains… might not be a lot but i'm financially secure.

[@JaneClark7861]

I’ve been looking to switch to an advisor for a while now. Any help pointing me to who your advisor is?

[@martinheaway]

My CFA ’Amy Desiree Irish’ , a renowned figure in her line of work. I recommend researching her credentials further. She has many years of experience and is a valuable resource for anyone looking to navigate the financial market.

[@JaneClark7861]

I just looked her up on the web and I would say she really has an impressive background in investing. I will write her an email shortly.

[@HarryBishopm]

Dave said “Don’t do a Roth if you’re over 55 because it doesn’t have time to grow”, But I have a cash savings of $600K which I need to invest for retirement, and I’m 57. What strategy should I use?

[@JordanReam8186]

What about throwing it into a roth where it grows. Or you can consult with an expert CFP to guide you.

[@WestonScally7614]

There are many ways to approach this. Converting your IRA to a Roth IRA can be beneficial, especially if done when the market is down. For example, if you're in a 22% tax bracket and convert $30k, you'll owe $6600 in taxes. If the market rises at a modest rate of 7% per year, you can recoup the $6600 in about three years. Converting when the market is high means it takes longer to recoup taxes. Since I'm over 72.5 and have to take RMDs, my CFP suggested this strategy, and it's working well. You need to consider your tax situation and goals. If you plan to spend the money soon, keeping it in a traditional IRA might be better.

[@SaintYvess]

Pls can you refer me to this CFP?

[@WestonScally7614]

Thanks for sharing, just copied and pasted *Victoria Louisa Saylor* on my browser and found her consulting page no sweat.. she is valid

[@WestonScally7614]

Thanks for sharing, just copied and pasted "Victoria Louisa Saylor" on my browser and found her consulting page no sweat.. she is valid

[@johnben9]

I just switched up my Roth IRA to 50% SCHD, 25% SCHX, 25% SCHG, and my Roth 401k is 70% vanguard S&P 500 index, 20% vanguard growth index, and 10% vanguard international index. Seeking best possible ways to grow $350k into $1m+ before retirement, I'm 55.

[@suzannehenderson5]

Consider financial advisory so you don’t keep switching it up, Top 3 payers for the month were $OHI, $KMI, and $EDP for an over all payout of a little over $20.. not bad for a 350k portfolio.

[@emiliabucks33]

Agreed, I’ve been investing in the market for 11 years now, last 4 years with the help of a fiduciary advisor apparently due to the covid-19 pandemic crash. Throughout these years of guidance, I've been fortunate enough to 10x my return as a DIY investor, summing up nearly $1m ROI as of today.

[@frankbarnes22]

No doubt, having the right advisor is invaluable, mind leaving info of your advisor here please? I only invest in 401k for now but particularly interested in diversifying my portfolio and exploring alternative options.

[@emiliabucks33]

I've shuffled through investment coaches and yes, they can be positively impactful to an individual's portfolio, but do your due diligence to find a coach with grit, one that withstood the 08' crash. For me, Carol Vivian Constable turned out to be better and smarter than all the advisors I ever worked with till date, I’ve never met anyone with as much conviction.

[@frankbarnes22]

Thank you for this. I just sent her an email, and I hope she gets back to me soon.

[@АннаВекшина-ю6б]

I am at the beginning of my "investment journey", planning to put 85K into dividend stocks so that I will be making up to 30% per year in dividend returns. Any advice?

[@JenniferAdams-r2k]

Investing without proper guidance can lead to mistakes and losses. I've learned this from my own experience.If you're new to investing or don't have much time, it's best to get advice from an expert.

[@ЛинаТарасовак6ы]

The issue is people have the "I want to do it myself mentality" but not equipped enough for a crash, hence get burnt. Ideally, advisors are reps for investing jobs, and at first-hand encounter, my portfolio has yielded over 300% since 2020 just after the pandemic to date.

[@LucasWilliam-b9w]

Glad to have stumbled on this comment, Please who is the consultant that assist you and if you don't mind, how do I get in touch with them?

[@ЛинаТарасовак6ы]

My CFA NICOLE ANASTASIA PLUMLEE a renowned figure in her line of work. I recommend researching her credentials further... She has many years of experience and is a valuable resource for anyone looking to navigate the financial market..

[@LucasWilliam-b9w]

I just googled her and I'm really impressed with her credentials; I reached out to her since I need all the assistance I can get. I just scheduled a caII.

[@r4ym1n13]

I converted my traditional 401k to a Roth 401k. No tax break now but I'll be smiling later in life when it's time to retire

[@monharris28]

same

[@Nepthu]

As long as politicians don't change the rules.

[@apnudi]

@@Nepthu what other choice do we have?

[@davidt5770]

@@Nepthu If you think the rules are changing, are you expecting taxes to rise or to fall? If your expectation is that tax rates rise (which I would guess) Then start conversions is a very good plan if you are able. (Not already in a high bracket) At least taxes should go up in 2026 when the jobs act expires and we revert to the less favorable schedule.)

[@Gheuns3251]

What happened to the money that was already in the traditional ? Does it get tax after conversion or does the Roth start accumulating on a seperate bucket ?

[@harrigill]

Two things to consider: 1) Future RMDs, if high enough, can not only put you into a higher tax bracket (which may be higher than today's brackets), but may also push you into an increased IRMAA payment which can be significant, and an additional Net Investment Tax. 2) Traditional IRAs inherited by your heirs will be fully taxable to them (with a 10 year requirement for full withdrawal), but inherited Roths are not taxable.

[@Oheeeoh]

One advantage to converting the ROTH that wasn't mentioned is it potentially lowers the amount of your social security benefit that is subject to tax.

[@Cathy-xi8cb]

You would have to earn almost NOTHING to avoid paying taxes on SS. That takes some fancy money management early in your career, or the desire to eat cat food. My mother was able to do that by spending years, decades really, craftily moving money into non-taxable investments, but you have to have money to live on while you do it. Most people with under 500K in assets and paid-off home/car/education/etc cannot do that.

[@hubster4477]

Retirement earnings dont affect SS.

[@cnewton6527]

@@hubster4477 it does affect the taxable income. Therefore affects the Social Security taxable amount and your Medicare rates.

[@MaximilianFischer497]

Great recommendations. I'm looking to start investing in the stock market and other asset classes with $60k this quarter. Should I focus on index funds or individual stocks? Preferably want the route with the best return in investment upon retirement. Thanks!

[@AshleySommerset808]

Index funds are a safer bet to start. They offer good diversification. But individual stocks could make you a fortune if you know how to go about it. Some people make upper six figures yearly from investing alone. But it's always a good idea to work with a financial advisor. It raises your chance of profit by a lot.

[@EvelynBrooks0]

I agree with that. Investing in a Roth IRA, I netted more than 300k in 2023 by using a financial advisor, despite crisis and the elections. It was like discovering a life hack.

[@MarshalWagner457]

Wow, that's interesting . I've recently been exploring the option of working with an FA too. Any chance you could recommend who you work with?

[@EvelynBrooks0]

Her name is “Diana Casteel Lynch”. Just research the name. You’d find necessary details to work with a correspondence to set up an appointment.

[@henryallard245]

I just googled her and I'm really impressed with her credentials; I reached out to her since I need all the assistance I can get. I just scheduled a caII.

[@Daniel-b1s3s]

I recently adjusted my Roth IRA to 50% in SCHD, 25% in SCHX, and 25% in SCHG. For my Roth 401k, I went with 70% in Vanguard's S&P 500 Index, 20% in the Vanguard Growth Index, and 10% in the Vanguard International Index. My goal is to grow my $350k to over $1 million within the next three years.

[@CarddtReddt]

It might be worth considering a financial advisor to avoid constant adjustments. Your selections are strong, especially for a $350k portfolio.

[@HotManP-l5g]

I agree-having an advisor manage my investments has been invaluable since my work schedule doesn't allow time for in-depth analysis. Thankfully, my portfolio has grown fivefold in just four years, reaching nearly $1 million today.

[@FrankJaaay]

@@HotManP-l5g That's impressive! Would you mind sharing your advisor's details? I’m in urgent need of rebalancing my portfolio.

[@HotManP-l5g]

I work with Rebecca Lynne Buie. At first, I was hesitant to let someone else handle my investments, but it turned out to be the best decision I’ve made.

[@maxshiraz3447]

Probably makes sense to do a conversion to max out the 22% bracket and have a better bsalance of Traditional and Roth

[@judynewsom1902]

I wonder if people that experienced the 2008 crash had it easier because. my portfolio has lost over $27000 and I don't see my retirement turning out well when I can't even grow my stagnant reserve

[@RickWatson-xu6gw]

You have an opportunity to rebalance thanks to volatility. In order to help you diversify your portfolio, you must hire a financial counselor or broker.

[@gregorywhem]

I'll suggest you create a diversification strategy because building a good financial-portfolio has been more complex since covid. I have accrued over $120K under the guidance of my coach during this crash

[@EverlyndPerez]

I’m new to all this, heard it's a good time to buy and basically I've just got cash sitting duck in the bank and I’d really love to put it to good use seeing how inflation is at an all time-high, who is this coach that guides you, mind I look them up

[@gregorywhem]

My advisor is *Alicia Estela Cabouli* she’s highly qualified and experienced in the financial market. She has extensive knowledge of portfolio diversity and is considered an expert in the field.

[@Theresaa12]

She appears to be well-educated and well-read. I ran a Google search on her name and came across her website; thank you for sharing.

[@CrystalJoy-32]

I am in my 40s and This is no time to taper retirement savings. I want to max out my retirement funding and I also have another $200k in a savings account that i want to invest in a non-retirement account.Would it be better going to housing? Maybe own property and let it till im ready to move in at 65.

[@LuvmeRos]

Research some dividend aristocrats and choose six to ten firms with over 25 years of dividend payments. Also consider working with an asset-manager to build a strong portfolio.

[@FrankPatrick-no8zo]

I wholeheartedly concur; I'm 58, recently retired, and have about $1,450,000 in outside retirement assets. I have no debt and, when compared to the value of my entire portfolio over the previous three years, I have very little in retirement funds. To be honest, investing with a portfolio advisor is brilliant!

[@RuthEvelyn-rc3bg]

It's always beneficial for a novice investor to hear from someone who has experienced all the bad times and overcome them. What are some successful strategies that I can use?

[@FrankPatrick-no8zo]

Monica Shawn Marti is the licensed advisor I use. Just research the name. You’d find necessary details to work with a correspondence to set up an appointment.

[@albacus2400BC]

Thank you so much for your helpful tip! I was able to verify the person and book a call session with her. She seems very proficient and I'm really grateful for your guidance

[@markadams8942]

Weird suggestion? Every advisor I have talked to - including my ELP - suggest traditional to Roth conversion.

[@DaveM-FFB]

There's actually a simple answer regarding Roth conversions. If your current effective tax rate is greater than it will be in your retirement, then you should not be paying excess tax now by moving tax deferred money into a Roth IRA. If you cannot estimate your effective tax rate in retirement, then you don't have enough information to make an informed decision regarding a Roth IRA.

[@DaveM-FFB]

@@timtoolman9940 If you do the math, for most people, pension, social security, plus RMD at 72 will still be less than the several highest earning years for a household. The average SS is $1,600/mo. 90% of America doesn't have a huge retirement nestegg. And every year, fewer workers have a pension.

[@davidcason7805]

This is the correct answer tax rate now versus later is all that maters

[@silver6054]

@@davidcason7805 More or less, and unfortunately the later rate is unknowable! But there are a few other factors, such as IRMAA (and the base cost of the premium). These aren't directly related to a percentage of income: if you are in a certain range of income, you will pay X% extra on a base of $Y (and Y is the same for everyone). Doing a reasonable sized Roth conversion at 63+ will probably push you into an IRMAA threshold, not doing one, come RMD time, will probably push you into another, with the unknowns of base cost, ranges for surcharge, and surcharge %.

[@1Mannco]

@@timtoolman9940 True..and if you had a decent paying job, waited to 67-70 to collect SS, have a good chunk in ret. funds and lucky to have a pension [many people dont] then it can add up and you may be in a higher bracket. New RMD Rules As of Jan. 1, 2023, the SECURE 2.0 Act increased the age for starting RMDs from 72 to "73". This is applicable to individuals turning 72 on or after Jan. 1. In "2033", the starting age increases again to "75". So an IRA say $800k, they're healthy, family usually lives into their 90's, they wait to 70 to for SS, have a pension...at 73 y.o the RMD's..[example]..w/$800k is $2,500/mo, at 84 y.o. w/$585k it's $2,900/mo, at 95 w/$375k it's $3,500/mo...then add SS that's probably grown, the pension= possible higher tax bracket.

[@KevinLeiker-mz4fu]

What if the government incurs an insurmountable amount of debt and then raises taxes to cover it? The Roth shields you if/when when the country follows Denmark.

[@miketracy9256]

When tax rates go way up in 2026, the more we have in Roth and the less we have in taxable retirements the better. Short-term pain today will yield long-term gain in the future.

[@KaeHwang]

A bad idea to convert all of $600K in one year. Should convert over several years to stay in 22% or 24% tax bracket.

[@Jim_Curtis]

The Ramsey organization should really do a better job of advising high net worth people like the caller to seek advice from their estate planning lawyer and accountant. To me, it's dumb to convert all of the IRA to Roth at their age and pay 37% tax for federal plus state tax on the conversion (and yes the conversion results in taxable income which the caller did not consider). A good advisor could tell the guy to let his kids pay tax on the IRA distributions when it passes to them or consider gifting it to charity as alternatives. It's clear he has had these tax planning discussions and a 5 minute phone call with Ramsey is not going to cut it for this.

[@MDJSTVFL]

Well at 70 you going to be forced to take MD, so depending on your situation it might be better convert, just watch the convert amount. As you are not paying taxes on the growth, additionally with the margins down it would be even better.

[@Jim_Curtis]

@@MDJSTVFL Yeah he could watch it grow if he lived to be 90+. At 64-65 years old, he should have done some estate planning to make an informed decision about what to do with the IRA upon death.

[@adamseidel9780]

100%. That said, I think Dave did a good job of basically saying “maybe.”

[@colebaker25]

Also if one of them happens to die the survivors tax status switches from married jointly to single which could result in way more taxes paid, especially if forced to withdraw with rmds. Definitely needs a professional planner to examine and give good advice.

[@bmf0354]

Yes, good advice. The conversion decision can't easily be generalized with all the possible variables in play. The tax bracket you're in when contribute to a Roth vs the bracket you're in when pulling $ from a regular IRA is a big factor.

[@kortyEdna825]

I've recently allocated my Roth IRA to 50% SCHD, 25% SCHX, and 25% SCHG. Meanwhile, my Roth 401(k) is divided into 70% Vanguard S&P 500 Index, 20% Vanguard Growth Index, and 10% Vanguard International Index. My goal is to grow my $350,000 portfolio to over $1 million in just three years before retirement. I'd love to hear your thoughts and suggestions on how to optimize my investments for maximum growth!"

[@brucemichelle5689.]

Consider consulting a financial advisor to help you create a personalized investment strategy, so you can avoid frequent changes and stay on track. That being said, your current picks look solid! Allocating your $350,000 portfolio across those funds is a great start. Just remember, consistency and patience are key to achieving your long-term financial goals.

[@NicholasHarmon-ow3jl]

I completely agree! Having a financial advisor manage my investments has been a game-changer, as my busy schedule doesn't allow me to dedicate time to analyzing stocks myself. And the results speak for themselves - my portfolio has grown an impressive 5X in just 5 years, reaching nearly $1 million today! It's a great feeling knowing my investments are in expert hands, giving me peace of mind and freedom to focus on my career.

[@KaurKhangura]

This is huge! would you mind revealing info of your advisor here please? in dire need of portfolio rebalancing

[@NicholasHarmon-ow3jl]

She goes by ''Aileen Gertrude Tippy'' a renowned figure in the financial industry with over two decades of experience. I'd suggest you research her further on the internet.

[@NicholasHarmon-ow3jl]

Thanks for putting this out, curiously inputted ''Aileen Gertrude Tippy''on the web, and spotted her consulting page no sweat.. was able to schedule a call session with her, she actually shows a great deal of expertise

[@brianfolding40]

Irritating when callers finally ask the question they want to ask and while Dave is doing his best to answer the question, the caller keeps interrupting...

[@Blitcliffe]

Certainly! I understand that living expenses and taxes can take up a significant portion of one's income in the UK, which can limit how far that income can go. Even 100k doesn't get you very far and the dream of retiring early is starting to seem like a fairy tale. I have roughly $200,000 in 401(k) that I need to grow quickly. Please leave a comment if you can help.

[@2024Red-j5t]

Invest in the financial market. I heard that people make millions if you know the tricks of the trade. Bloomberg and other finance media have been recording cases

[@Countstep0099]

@@2024Red-j5t It depends on your personal preferences and comfort level. However, one option is to keep things simple and consult an investment-advisor. They can help you determine your risk appetite, avoid common mistakes, and provide a broader perspective on your investment landscape.

[@Petroguest-i4g]

@@Countstep0099 This is exactly how i wish to get my finances coordinated ahead or retirement. Can I get access to your coach?

[@Countstep0099]

@@Petroguest-i4g Yes, a Fidelity financial advisor named "NICOLE DESIREE SIMON" put an end to my fears about investing, and after making more investments, I was able to reach the high six-figure mark in less than 3 years. A licensing advisor satisfies the necessary security criteria; hence, reimbursement is guaranteed if I'm dissatisfied with the service, so I'm much better off hiring one.

[@Petroguest-i4g]

@@Countstep0099 I just copied and pasted her full name on my browser, super impressed with what I've seen so far. thanks for sharing!

[@tommyg6178]

I do 100 dollars in scratch off lottery tickets every Friday. That’s my retirement plan. So far I’m still working.

[@peterhoffman8525]

Consider the widow's taxes being much higher if the husband dies before the money is converted to Roth. All those RMDs will play havoc with the couple already and if one partner dies, the survivor will pay even more tax on income as a single person.

[@BarryWhite-h9m]

I just turned 41 and awfully late to investing with barely any portfolio except my 401k, I have a decent amount of cash saved up and with inflation currently soaring AGAIN, I’m getting worried about retirement, my intention is to retire at 65 at least, so how best do I maximize my savings of over $500k?

[@gregorywhem]

It may be a good idea to speak with a financial advisor who can help you develop a portfolio based on your individual goals and risk tolerance.

[@NormanGhali]

Partnering with a financial advisor has transformed my approach to investing. Their expertise and personalized guidance have not only helped me navigate complex financial markets but also optimized my portfolio to achieve my long-term goals efficiently.

[@MarkJoe-e7f]

Your advisor seems competent. Could you share how I can reach out to them? I've recently sold some property and am interested in investing in stocks, and I'm seeking guidance.

[@NormanGhali]

Marissa Lynn Babula is the licensed advisor I use. Just search the name. You’ll find necessary details to work with to set up an appointment.

[@JoelCharisma-q5u]

Very kind of you to share. I'll send her an email and I hope I'm able to connect with her.

[@blackworldtraveler3711]

Glad I only contributed to aftertax and Roth in my 401k.

[@TheTurdballs420]

If you’re smart you retire with your house and cars paid off. Therefore you should be in a much lower tax bracket when your retired than when you are working. If you like paying extra taxes then you’re doing a really good job. If you want to pay as little taxes as possible the formula is pretax contribution while working

[@ClaxtonBay123]

It all depends on what your plan is. One isn't necessarily better than the other by default.

[@blackworldtraveler3711]

@@TheTurdballs420 I’m good. I have around $450k taxable in my 401K because of company match and after tax gains. Not going to complain with close to two million tax free Roth. Completely debt free with two homes and three rentals. After being retired for almost two years and observing what others are going through getting slammed by the IRS and IRRMA because of taxable cash emergencies during retirement I see now that I made the right choice…..especially with 2026 approaching.

[@rayjgold]

@@blackworldtraveler3711 you feel you made the right choice because it is the choice you made.....and we always make the right choice. But if you calculate all the taxes you paid on the money before you put it in the Roth, it may very well come out to more than you would have paid withdrawing it in retirement......and you essentially have more to put away if you put it away before taxes....and therefore would have more than you have now...in retirement.

[@blackworldtraveler3711]

@@rayjgold I made the right choice. Glad I contributed to my aftertax and Roth in my 401k. Started early saving and investing since 10th grade and close to million net worth by 30. Past ten years I took off 3-4 months without pay each on top of six weeks paid vacation each year to travel and do other things I enjoy. Best I could do was contribute $45k-$52k a year to 401k and max the Roth IRA. Other savings/investments, passive income etc.. Retired at 49 two years ago so I have a while anyway with minimum ten years of growth to look forward to with 401k/IRAs. Paid cash for the rentals and beach home over ten years ago after housing crash. I’m good.

[@DeborahMicheal6k]

I think investors should always put their cash to work, especially In 2024, we'll start to see more market diversification. I'm hoping to invest about $350k of my savings in stocks against next year. Hope to make millions in 2024

[@JulianBenjamin3d]

Since risk is at an all-time high right now, perhaps you should be a little more patient and return when it has decreased. Alternatively, you can consult a trained financial expert for strategy.

[@ElizabethElijah2g]

Yes true, I have been in touch with a brokerage Advisor. With an initial starting reserve of $80k, my advisor chooses the entry and exit commands for my portfolio, which has grown to approximately $550k.

[@RubyOliverm5l]

I’ve been looking to switch to an advisor for a while now. Any help pointing me to who your advisor is?

[@ElizabethElijah2g]

My CFA NICOLE ANASTASIA PLUMLEE a renowned figure in her line of work. I recommend researching her credentials further... She has many years of experience and is a valuable resource for anyone looking to navigate the financial market..

[@RubyOliverm5l]

I searched for her full name online, found her page, and sent an email to schedule a meeting. Hopefully, she responds soon. Thank you

[@rickdunn3883]

Need to consider IRMAA, effect on Social Security income and other tax implications when doing a Roth Conversion. It requires a complete analysis to determine if it should be done. Wrong Dave: the professionals talk about Roth Conversions all the time. Using cash to pay the taxes can be more beneficial. Roth Conversion is two steps: 1. Remove some funds from your Traditional IRA-this is a taxable event (ordinary income rates). 2. Deposit into a Roth (Five year rule applies). Lots to think about - these are only a few.

[@maryjones6115]

We plan to do conversions next year. My husband is retired so our only income would be the Roth conversion amount. So, let's say we move 50K from Roth to 401K and the married deduction is $24,800 ; we will only be taxed on$ 25,200!!! Our state does not tax retirement income, incl. Roth. So, we are set.

[@krugcpa]

Assume you are drawing Social Security? If so, a portion of that income will be become taxable. The conversion still is worthwhile, but it will cost more in taxes than you are thinking.

[@Mechulus]

That is the RIGHT way to do it. Too many people here are converting at 22-24% for no good reason, and they lose the compounding effect of that lost tax money. It drives me crazy seeing how people make such bad choices just because they heard Roth is the best. There's a right way and a wrong way to do it, and you've shown the right way.

[@gibblespascack1418]

My daughter is 22 and I have helped fund her Roth for several years. This is the time to create the funds where it will have 45 years to grow. That mean that everything put in up until now will double 6.5 times before retirement. I also started a brokerage account for her and the goal is to get it to 100K in another 7 years. That way when she graduates college this year, she should be well on her way to becoming a millionaire by her 40s. Hopefully by that time she will be good enough to run my portfolio as I start to decline.

[@sonnysamu2645]

A few comments regarding this. If I was young and worked for a company that had a 401k plus employer match I would definitely take advantage of that. I would open a traditional roth while working and contribute to what you can. When you retire convert all or a portion into your traditional roth. Most people today when they retire will be in the same tax bracket or higher. If you are in a lesser tax bracket then you probably did not save enough. So your tax situation for the most part will probably not change if you have both. Even if you and your spouse worked 40 or more years then your social security will be pretty significant. Couple that with any withdrawals and you increase your income. So really the one big advantage in this case regarding a traditional roth is that it is tax free but it also does not count against social security taxation when calculating your provisional income. This is a nice little perk since most of us middle class are on a FIXED income. If retired, then at age 65 everyone needs to sign up or go on Medicare which can be another significant cost per month depending on the options you select after part A & B. Remember parts A&B do not provide a complete blanket of coverage. You also need to consider medicaid costs which will significantly affect your spouses ability to live if one of you end up in a nursing home. Just my .02.

[@damondiehl5637]

Converting from Traditional to Roth at retirement just creates a huge tax event for yourself. Doing it the same year that you are still employed could easily move you into a higher tax bracket, as well. The whole benefit of a Roth account as that all the growth is tax free. Converting to Roth late in life only makes sense if you are going to let that investment sit for another 15 years or more.

[@Aortadetroit]

Confusing, you actually made the argument for a Roth. Tax rates for a young person are almost certain to be higher and Roth is the best way by far to minimize taxes.

[@sonnysamu2645]

Not confusing you would open a traditional Roth separate from your 401k. You take advantage of the 401k employer match while working. Once you retire you roll the 401k into a traditional IRA or into your Roth. If the tax hit is to high just roll into a traditional IRA. Do conversions yearly to lessen the income tax hit. I am referring to total income earned not taxes on the converted amount. You will have to pay taxes on that amount. The idea is to not throw yourself into a higher tax bracket based on the converted amount. So yes a Roth in your later years makes more sense since you would probably not be in a lower tax bracket. Remember I am assuming you started a Roth relatively early after you left your employment that had the 401k. Most people do not stay with the same company for 35-40 years just a fact. Once you leave employment with that company the 401k is essentially dead unless you can roll it into another 401k plan with your current employer. If not this is where your Roth comes into play. Most companies allow you to roll-over into their plan. However, if you take a new job that only offers a pension then you would be foolish to contribute extra post tax money to your 401k. You should contribute any money to your Roth at that point. Do the conversions when appropriate into the Roth. Remember conversions and contributions are not the same. So you can contribute up the limits each year and do conversions at the same time. I no it sounds confusing but that is because people think they only need one retirement account. While that would be true if you worked 35-40 years with the same company, most will not achieve this. Believe me I am living proof of that scenario. Hope this helps.

[@alanm2842]

@@Aortadetroit young people raising a family are usually in a low tax bracket. max out a roth if this is you

[@Aortadetroit]

@@alanm2842 I'm rich actually. Anyway several serious pitfalls here. 401K fees are notoriously high and most 401K's return far less than a low cost ETF/Fund. That is a huge deal. Obviously if you get matching funds from your employer you max it out and that offsets some of the losses caused by fees. Checking Bloomberg Corporations 401K you would think it has low fees and excellent performance. It has neither and it's pretty typical these days. Pensions were much better. Again ,obviously use a regular IRA to drop yourself out of a tax bracket otherwise never use them. Use an HSA instead and a Roth. If you can max your Roths now not later because there is a very high probability conversions will be taken away by Congress. Were HSA's even mentioned? Maybe I missed that. Those are fucking magic. I'll stop here but I would recommend doing a LOT more research and rethinking that comment. Which of course has some great info and is well intentioned. But if you are 55 or less you are screwed on medicare (start HSAs now!) and your taxable SS will likely go from 80% taxable to 100% because neither Party works for us anymore. The only hope of low taxes in retirement with a diversified income stream is from inside Roths. Or you can own Hotels and real estate like I do but I struggle to stay out of the top bracket. Everything is harder than it looks now after 65.

[@butopiatoo]

69 and looking to convert some amount to ROTH this year and in 24 and 25 before tax rate go back up in 2026. It's always been said doing conversions late in life isn't a good strategy since it won't grow to offset the taxes paid at conversion. No heirs to pass to, so this is all about reducing RMD tax liability in the future. Too bad so complicated. Oh well. Thanks Dave for all your "life" advice. It has worked well for me.

[@huskypup3489]

Why would you convert and pay the taxes when the income will be added to your job W2 income. By 72, he may not be working, with no W2 income, the tax rate will be lower on the IRA withdrawal.

[@iamhischosen3866]

That’s what I’m thinking

[@southpaw9995]

This is exactly right. Majority of people will be in a lower bracket when they retire and that’s why saying to consult your tax advisor would’ve been appropriate advice in this video. You need a decent amt of time after the conversion for it to make sense. This could be from either not needing income or making sure you’re not close to dying. Your non spouse heirs will have to take it all out of the Roth within 10 yrs now with the new rules.

[@davehodge4606]

Reasons for doing it are tax bracket planning, RMDs pushing you into a different bracket, death of a spouse pushing you into single payer category, beneficiary not being pushed into a higher tax bracket... Ed Slott has a book on it.

[@BrandonMinguez]

It’s reasons like this that the Roth 401k should always be looked at when considering a workplace retirement account.

[@jdmulloy]

They only recently became available and common. So many already have substantial assets in traditional. Also employer match has always been traditional, even if you're doing it all Roth. The next bill that just passed will sometime soon allow 401k plans to have an option to pay taxes to make the match Roth, but I assume it will still require plan administrators to see that option up, so it will likely be a few years before most of us have the ability to make our match money Roth.

[@HodgeChris]

With Roth IRA, the money you are contributing has already been taxed. At any time for any reason, you can withdraw your contributions tax-free and penalty-free. Additionally, any earnings on investments can also be withdrawn tax-free and penalty-free, Not sure how much to contribute, I'm still at a crossroads deciding if to liquidate my $338k stock portfolio.

[@Pamela.jess.245]

For the average person, the strategies are fairly demanding. In actuality, most professionals who have the necessary abilities and knowledge to complete such occupations do so successfully.

[@carssimplified2195]

I wholeheartedly concur, which is why I appreciate giving an investment coach the power of decision-making. Given their specialized expertise and education, as well as the fact that each and every one of their skills is centered on harnessing risk for its asymmetrical potential and controlling it as a buffer against certain unfavorable developments, it is practically impossible for them to underperform. I have made over 1.5 million dollars working with an investment coach for more than two years.

[@Justinmeyer1000]

I need a guide so i can salvage my port-folio due to the massive dips and come up with better strategies. How can one reach this advisor???

[@carssimplified2195]

Do your due diligence and opt for one that has tactics to help your portfolio continue consistent and steady growth. "JULIE ANNE HOOVER’ is accountable for the success of my portfolio, and I believe she has the qualifications and expertise to accomplish your objectives.

[@Justinmeyer1000]

This is useful information; I copied her whole name and pasted it into my browser; her website appeared immediately, and her qualifications are excellent; thank you for sharing!!

[@MrBrewman95]

I have a Roth IRA and just started with a new company for a 401k. I need to convert it to Roth because I don’t see taxes being lowered in the future at all and I’m not making a ton of money anyway.

[@blackworldtraveler3711]

Taxes set to rise in 2026. Tax rate will go back to what they were before 2017.

[@damondiehl5637]

Lots of companies now offer Roth 401k plans. The company match has to be Traditional, but everything you kick in goes into the Roth side.

[@cliftongreen1281]

I would just leave it and just contribute to both.....

[@scruffy4647]

Lots of ways to think about this. The conversion can work in your favor interest wise. Wait until the market tanks, than do the conversion. Taxes paid on the conversion can be recouped on interest earned on subsequent market rise. As an example, let's say you are in a 22% tax bracket and you only convert $30k to the Roth from your IRA. Taxes due is $6600. The market being markets will likely rise. At a half way modest rate of 7% yearly in three years, you would have recouped the $6600 in interest earned on the $30k. If you do the conversion when the market is high, the time frame to recoup taxes is a lot longer time frame. I am pass 72.5 yrs old and have to do the RMD. My CFP suggested this to me and so far, it's working. You have to play with the numbers and your tax situation. If you intend to spend the money soon, then I would leave it in the traditional IRA.

[@Hannahbenowitz]

I am haldway through my 40s and This is no time to taper retirement savings. I want to max out my retirement funding and I also have another $200k in a savings account that i want to invest in a non-retirement account.Would it be better going to housing? Maybe own property and let it till im ready to move in at 65.

[@HildaBennet]

Research dividend aristocrats and choose six to ten firms with over 25 years of dividend payments. Also consider working with an asset-manager to build a strong portfolio.

[@FinnBraylon]

people do not invest in the stock market because of lack of guidance. Every year you don't invest, you are falling behind. I’m hitting numbers in the stock market I used to dream of… now my dreams are getting bigger. Going from ($50k to $600k) is surreal all thanks to insights from a professional.

[@FinnBraylon]

A percentage of workers do not invest in the stock market because of lack of guidance. Every year you don't invest, you are falling behind. I’m hitting numbers in the stock market I used to dream of… now my dreams are getting bigger. Going from ($50k to $600k) is surreal all thanks to insights from a professional.

[@JosephineKenney]

I thought such gains are nothing but a pipe dream! mind sharing details of yourmanager please?

[@FinnBraylon]

She goes by ‘’Sonya Lee Mitchell’. I say you look her up. To be honest, I almost didn't buy the idea of letting someone handle growing my finance, but so glad I did.

[@justgoto8]

One thing to note, if you’re self employed or 1099, you can use the regular IRA to reduce your taxable income. If I under pay my estimated taxes by 2k, my accountant calls me up and says, you can either give the government 2-3k or you can put that in a regular IRA. Good to have both but the regular IRA is a good a way to reduce taxable income, and the Roth isn’t.

[@texcosmo4236]

I just called my 401k provider and they allowed me to move my 401k contributions into my 401k Roth. The first person I talked to said they don’t allow it. You need a specialist at your provider to help.

[@howard1431]

If one regularly donates to 1 or 2 not-for-profits, why convert to Roth and instead do a qualified distribution directly to the charity? Thus, no tax hit on 401k RMD and donations are tax-free without needing to exceed standard deduction. Sure, it might be different if you want to pay the taxes on the conversion, depending on who might inherite your money. When ones estate is going to 1 or 2 charities, I can not figure out the benefits of a Roth conversion.

[@PH-md8xp]

That has to be the most oversimplified answer on Roth conversions on all of KZbin! There are many nuances to this topic. Also, it’s best to pay the taxes on a Roth conversion from assets that don’t originate from the IRA being converted if at all possible. I’ve found newRetirement to be very helpful at modeling various Roth conversion strategies.

[@HB-yq8gy]

Yes, NewRetirement confirmed my suspicion that Roth conversions weren't the way to go in our situation. However, all the financial gurus on YT will tell you otherwise.

[@PH-md8xp]

@@timtoolman9940 I’m not advertising anything. I’m just an individual retiree trying to figure this stuff out like many others. Don’t make false assumptions please. I do use newRetirement as it provides some excellent insights. Also, yes he mentioned something about paying the taxes from funds derived from outside the conversion, but only as an afterthought from a comment the lady added. All I’m saying is this is a complex topic as it has an impact on ACA subsidies, IRMAA, etc, and this discussion was grossly simplistic and shouldn’t be taken as valid advice in any shape or form.

[@Stashmo]

Most 401k plans don’t let you roll funds into an IRA while you’re still working for that company.

[@Stashmo]

Ramsay’s not the best on sophisticated stuff.

[@Stashmo]

He’s more of a motivational entrepreneur for average Joes.

[@mb3799]

If leaving the money as inheritance (non-spousal) is in the mix, then a Roth is even more desirable. Beneficiaries have 10 years to withdraw with no RMDs and no taxes. They get 10 years of untaxable growth, and when they do withdraw, it has no impact on their taxes. Also, RMDs on trad IRAs and 401ks can cause issues with Medicare premiums. Roth withdrawals do not impact Medicare premiums.

[@mike73ng]

Yes you should do the conversions between 65 and 7x (when you have to take RMDs). Convert up to the 20%ish tax rate for an effective tax of 10-12%. Do so that your 401k is almost eliminated. That said, probably not a factor for many who barely have savings in their 401k.

[@babulalsatasiya]

I think withdraw all money slowly make sense if the purpose of withdraw is to save tax. e.g. if you withdraw now all at time, you pay tax on all $600K and that is 37% Tax rate all money, he is working now, but not sure he will do after. I think without full details, it is not easy to make yay or nay decision. Always put all data into sheet and find-out what is income with or without Social security. Let us say he makes $50K, If he does not take SS until 70, that makes his income to be $50K+Withdraw of 150K for next 4 years. he would pay less tax over 4 years vs doing in one shot. Regarding growing tax free is silly, since there is a cost basis and there is deferred tax growing too. so technically it is not bad idea to keep deferred tax unless these money pass-down to his kids and they need to pay tax. so it boils down to their health. Overall Roth is good idea, but rushing to convert and forget means paying full tax while waiting to take advantage was original investment goals.

[@MoneyTalkwithMP]

I like the "LOVE TO WORK" sentiment. When you love what you do, it is not going to be like work!

[@Erikkurilla01]

I think it's time to make it more appealing for potential buyers. Real estate can be quite the rollercoaster! the stress and uncertainty are getting to me. I think I'll cut rents to attract potential buyers and exit the market, but i'm at crossroads if to allocate the entire $680k liquidity value to my stock portfolio?

[@jessicasquire]

'Overall, buyers hold a lot of the cards right now, and sellers are having to give out more concessions to close a deal." All the best, buying on sale is actually one of the best ways to invest in stocks, and advisors are ideally suited for such task

[@PajinakStanovska]

this sounds considerable! think you know any advisors i can get on the phone with? i'm in dire need of proper portfolio allocation

[@PajinakStanovska]

She appears to be well-educated and well-read. I ran a Google search on her name and came across her website; thank you for sharing.

[@errin4]

I’m 74. Moving some every year but only as much as will allow me to stay below the 24% marginal tax rate.

[@micheleyoungblood]

Watch out for Irmaa cliff. The maximum taxable income taking you into the first Irmaa category is inside the beginning of the 24% tax bracket. Married filing joint starts Irmaa at $206,000. You need to stay under this number.. if you're single it's 103,000. If you are getting into Medicare age in two years, we're already on medicare, you do not want to go into the 24% tax bracket best to stay at the top of the 22%. You said you're 74 years old, so you are well into Medicare. I assume you know what Irmaa is? You cannot go $1.00 over or you are slapped for a year of additional premiums. So 24% bracket is not what you want to do.

[@errin4]

Thank you! Point taken.

[@goldengriffon]

This video leaves out some important considerations, most notably what your income tax bracket is or will be. For most people, I think their future/retired income will be lower than their current income. So it would make more sense to NOT convert, and wait until they are in a lower income tax bracket to have to pay taxes on the money. Plus, leaving the money that will eventually be used to pay taxes in the account will let your balance grow faster!

[@daisyreinacher5022]

False. We needed the same income as when we were working. It’s just spent in different ways.

[@mnotlyon]

If you make less money in retirement than you did while working, you did it wrong.

[@matthewsheahan9435]

Also, things change when you hit 72 and have to take mandatory withdrawals. If you've amassed a sizeable amount in your traditional, you may be forced to start drawing a large taxed salary. Also when estate planning. If you leave a sizeable amount when you pass to someone (depending on who and their age), they may have to withdraw that amount over 10 years.

[@followthesun2115]

Excellent point. Many people are in a lower tax bracket after they retire.

[@goldengriffon]

@@matthewsheahan9435 Good points. While taxes on RMDs over 10 years would almost certainly be smaller than the taxes paid by moving it all over to a Roth in one swoop, the tax savings might not be worth having the money out in cash at that point instead of sitting in a Roth to grow longer. And also agreed about inheritance: If the decedent had already begun taking RMDs, then the heirs will wish they had transferred to a Roth. But even in this caller's situation, something they might want to consider is health care expenses. If they have higher medical costs later in life (as many do) and pay with funds out of a Roth, the tax deductions such medical expenses may provide could be of limited utility. But if you have some 401k or Traditional IRA money still available, you might be able to pull it out for the medical bills effectively tax-free.

[@fabiGBOtown]

I wish I could ask dave some questions about saving on taxes while investing. I keep getting bits and pieces from the internet but not one "path" to maximize deductions and invest.

[@plathiasjenkins1011]

Honestly, this probably isn't the best advice for a man of this age. There are significant tax implications for pulling that much money out of a traditional 401k. This couple will almost certainly move up to a higher tax bracket and end up paying more in taxes. It didn't sound as if the caller had a bunch of cash sitting around, but I could be wrong. Many people develop health issues later in life, often unexpectedly, and are essentially forced into retirement physically. If the caller starts accessing that money sooner than Dave said, then it likely would be the wrong call. Dave may be a great resource for getting out of debt or real estate, but he isn't an investment or tax expert. I'm sure he has more knowledge than the average person, but I suggest seeking expert advice on topics of that level of importance.

[@FloppedPizzaParty]

@@plathiasjenkins1011 well said. It just depends on if the caller will actually use the money before being forced to use it by 72 and pay taxes on it. And I like what you said towards the end, great resource for getting out of debt, but best to speak to financial advisor or tax expert.

[@blackworldtraveler3711]

@@plathiasjenkins1011 Higher tax bracket at retirement could trigger IRRMA as well.

[@dwights1464]

@@blackworldtraveler3711 Good catch. Also, once one spouse passes, the income thresholds for the various federal marginal income tax brackets are cut in half, so the remaining spouse could wind up paying more in income taxes on less income (when the lower Social Security check stops).

[@Cathy-xi8cb]

Your path is to hire a CFP, not watch a show.

[@johndv952]

would it not be better to wait until you retire to move some of the money to the Roth - your tax bracket is typically higher while you are working so the tax bite on the conversion will be higher than when you're retired?

[@damondiehl5637]

It depends on how much you make and how much you convert. You could stay within the same tax bracket, but the conversion could bump you up to the next bracket. Search the web for tax brackets for the current year. Any number of sites will have them listed.

[@jimmyp7999]

Roth conversion should be done every year and based on tax brackets. It is important to know that when you do a conversion you must not make any withdraws for 5 years, or you will pay a penalty. That is why smart people will end up with several roth accounts, one for each year.

[@james1000]

It’s tax rate now vs tax rate later. That’s the question. He’s still working so may not be the move to make Roth conversions. It is true that if one spouse dies, tax rates go up due to now filing as individual. So that favors Roth. And tax rates may go up in the future. But ultimate question is tax rates may now vs later when you’d otherwise pull the money and whether there’s an arbitrage potential.

[@legarockefeller]

I love how she helped dad and blocked the caller from talking 😂❤

[@hlakegollum1]

Guy won't shut up.

[@Kevin-yn7ju]

The goal should be to be like this guy, have so much savings and still operate without it that you have no idea what to do with your money.

[@captsorghum]

Actually you would want to do it before starting Social Security, not wait until just before RMDs start.

[@tomfields3682]

Yeah, the guy's wife took SS at age 62 and he is still working. She should have waited until 70 to take SS.

[@jg11596]

Is there a formula or calculation to help determine how long it will take to recover paid taxes on a Traditional IRA conversion to Roth?

[@Cathy-xi8cb]

Yes; you need to stay alive about 10 years.

[@titoperez1327]

I am 53 years old. I’ve been working for 28 years in my company because new structure now they are changing the retirement plans instead of 75% of my current salary. They are offering 33% at the age of 60. I have $210,000 in my pension fund, if I leave it there they’ll give me 1800 at the age of 60. If I retire now they give me $985 for life. I don’t have any more money saved and I want to enjoy my youth. How can I Aire some money for enjoyment and where should I saved the Rest ?

[@MrEdwardCollins]

I'm 63 and retired... living off my passive income (rental) and my savings. I'm planning on waiting four years, until I'm at 67... possibly even longer... before I start collecting Social Security. I'm in the 10-12% tax bracket now, with my reduced income. Would it make sense for me to slowly, over the next five or six years, to pay those taxes now and move a portion of my IRA to a Roth? My income will only increase later, down the road, once I do start collecting Social Security. If I DO ever need to access a large chunk of my IRA funds at a time (like if I want to buy a home) I don't want to have to pay any tax at the 22% rate if I can avoid that.

[@genglandoh]

In my case I estimate I will be needing to withdraw only 2% of my retirement saving to live on. I am planning on moving about 50% of my 401k into a Roth to go to my kids. The remaining 50% that is still in my 401k I will use to live off of making the withdrawal rate of 4% from the 401k only.

[@ivanvargas2425]

Wish I would of started my Roth IRA a long time ago. I don’t agree with everything Dave says in regard to real estate and CC but he’s dead on with this and debt

[@Leeon_King]

What part of the real estate do you disagree with? I know his stance on CC (which I disagree with) but not sure of his stance on real estate.

[@ivanvargas2425]

@@Leeon_King the part about buying a rental and paying it off in full. Plus your home has to be completely paid off first before getting into real estate. At that rate it would take forever to become a millionaire.

[@Snake-bq3kf]

How old are you?

[@matthewgardner2144]

@@ivanvargas2425 Agree..sometimes some careful leverage can be a useful thing in building wealth through a few rentals. The idea is not to get too crazy. Dave is wrong with this.

[@JS-sv4ol]

If you wouldn’t mind - curious and wondering what decade you started investing into a Roth?

[@jimh8080]

Spread it out over a few years to keep the tax rate on the conversions down. If you do it all at once you will pay a much higher tax rate on the funds you convert.

[@sorrygtfo]

Is there a limit to how much I can contribute to Roth each year? 6k right?

[@DareDog.]

Yes for Roth IRA it’s max of 6k.

[@lilzorro9142]

That's a different kind of roth. They're talking about their 401k

[@JWH808]

$20,500 for Roth 401(k)

[@bhupesh0111]

Contribute $6000 for Roth IRA Contribute $20,500 for Roth 401k

[@peartfaldo]

7k if over 50

[@robn.7426]

Dave - that money will be going to the kids. Rachel - 🤗

[@leemcfarland4769]

Roth is a fantastic tool. I'm 60 (and retired) and will convert $150k each yeay till 70 from my standard IRA. Most of my money will be in Roth then. I'll start collecting Social Security and live off my Roth.... and never pay taxes again. And YES, financial advisors don't tell you this. Another benefit is your beneficiaries never pay taxes, and they can keep it in a Roth. Tax free forever. Dave is converted... you should too.

[@SurfCityBill]

No. Paying the taxes out of transferred funds is a mistake. In order to maximize the potential of this strategy working, the taxes need to be paid out of after-tax accounts.

[@rkirkend]

Except if he lives in a high income tax state today and plans on retiring to a low or no state income tax in retirement that could change the equation

[@JakeTheSnake500]

I like how Dave told Rachel that he's leaving the Roth to the kids. It avoids coversations like in that TV commercial, "Awkward question, but is there going to be anything...left?" 😅

[@briemann4124]

I was wondering this a few months ago. I’m glad someone had the courage to ask!!!

[@johnscott2746]

Roth has a lot of benefits. I started one a long time ago and did a couple of conversions too. Now I can take distributions from my traditional Ira and supplement it with distributions from my Roth IRA and have plenty of money to live on and pay no income tax and my much younger wife gets fully subsidized health insurance. By the time I turn 73, I should have used up the balance of the traditional Ira and I will take Social Security at 70. Then we can start moving my wife’s retirement accounts over to her Roth IRA and when I pass on she gets my larger Social Security benefit and all of her investments will be in Roth accounts so no taxes.

[@PH-md8xp]

Sound like a solid plan. What if you outlive your wife. Yes, she’s younger but life happens.

[@johnscott2746]

@@PH-md8xp don’t see why that would matter. If it happened before I turned 70 I might rethink things. But if I’m already 70 and drawing my benefit then I will have that larger check for the rest of MY life anyway.

[@kzalaska4804]

Also, who believes that tax rates are going to go anywhere but up in the next few decades?

[@Savedcitytitan7118]

I'm envious of rachels abilities to listen and absorb

[@MyLifeThai371]

I know. She is such a sponge.

[@titanrain3374]

Pro tip - just fast forward to 2:01.

[@paulharmon8947]

Pay off your mortgage. Huge step to a good retirement. As time goes on invest in different things, U.S. based, and let it ride. The point is to invest in Roth's and solid companies that are mostly American because they have good staying power. Recycle your money tax free.

[@PMP-e9r]

im 38. in a new job. my employer offer option of 403B both traditional and roth. shall i just go with roth option straight away? thanks hope for ur response

[@rodeleon2875]

it looks like nearly every comment in daves videos anymore are bots. notice how they start off with blah blah and one of the bots ask for who their advisor is. i suggest all these bots invest with my personal advisor, a man by the name of bernie maddoff. might be hard to get ahold of, but keep trying.

[@damondiehl5637]

She appears to be well-educated and well-read. I ran an online search on her name and came across her website; thank you for sharing. ;)

[@duellingdescartes7950]

Just send Dave your money, so he can save you money.

[@tedhansen3846]

Another aspect I hadn't considered Dave, thank You

[@MikeS-7]

The reason CFPs don't want you to take it out of your 401K, at least if they are managing it, is they get paid on the entire portfolio, typically 1-2%. They should really only get that on profits only.

[@marktate2683]

Alright, I have concerns on what to do with my match. I get a piss poor 3% match that's vested 25% per year over 4 years. Just started my Roth 401k back in July, but my understanding is that my match is not taxed but still funnels into the same account. My 401k is through Fidelity as well. What steps do I take and when so I can get the taxes paid on it ASAP and keep growing interest free.

[@jose2212-]

I have an Investment portfolio that's worth $1million, I don't think that'll be enough for retirement. I need an average risk investment strategy in stocks that'll give me more yield. Is buying stocks now a goods idea?

[@carolynrose1816]

As they say, time IN the market is better than trying to time the market. I think you should seek advice from a licensed financial advisor. They’ll give you guide on high risk and low risk investment strategies for your portfolio

[@AddilynTuffin]

Working with a financial advisor has been a game-changer for me. They provided invaluable insights and tailored strategies that aligned perfectly with my risk tolerance and financial objectives. With their support, I've seen significant growth in my investments and gained confidence in my financial future.

[@NO-TIME170]

I've been looking to get one, but have been kind of relaxed about it. Could you recommend your advis0r? I'll be happy to use some help.

[@AddilynTuffin]

*Jennifer Leigh Hickman* is the licensed advisor I use. Just search the name. You’d find necessary details to work with to set up an appointment.

[@CrystalJoy-32]

I'm pleased with the advisr's prompt and knowledgeable assistance. Their professionalism instills confidence. Looking forward to further discussions.

[@jasonwilkins1969]

This is pretty bad advice to be honest. It’s important to remember that. The standard deduction will always mean that some income is never taxed. It’s important to remember that because if you convert all of your money into Roth, you will pay taxes on money you would’ve never paid. Any discussion of Roth conversions has to involve the question of taxable income, not subject to tax because of basic deductions

[@ttenner9179]

Roth conversion makes sense if your tax bracket now is lower than in retirement. That is the only consideration. Dave missed that. His teaching does not go far beyond very basic stuff. The caller still works and his wife already collects social security. They have 600k saved, which will give them some 25k a year - probably less than what the husband makes now. So their future tax bracket is likely lower than it is now. RMD’s are not a great concern in this situation.

[@drdotter]

I retired at 56, three years ago, with a decent FedGov pension and over a million in my TSP (401K-like vehicle). I'll take SS at 62 because the breakeven is around 81 and I don't know if I'll live that long or if the SS will still be paying the expected amount. I have a fairly aggressive withdrawal schedule for my TSP, hoping to zero it by the time I hit 81. I don't spend crazily, so any money I withdraw that I don't need will be converted to a Roth. I have to pay taxes on it, regardless. If I live past 81, then I'll have tax-free money to draw on, while still receiving my pension and SS, and with a paidoff home! I can't imagine having money issues especially since I'm divorced from the only significant drain on my finances. Thank you, Jesus!!!

[@JPE_DRAEB]

What if you only withdraw the yearly earned interest? Living off the interest per say after retirement!

[@biggerscranerealestategroup]

How does Dave even have a Roth? I thought there were income limits that he would certainly be well above, preventing him from having that as an option. What am I missing?

[@Apollo809]

If you contribute to a Roth IRA while you are working, you pay a higher tax rate. I am sure I will not use all of my traditional IRA before I die, so I will not pay any tax on that portion that I do not use. The distributions I do take will be taxed at al lower rate because I am no longer working.

[@lostinmyspace4910]

The question is, "why didn't he just convert anything he received on an annual basis into ROTH? Why do a conversion when the balance is so very large? He should've converted when he had income to do so rther than now race to do a conversion at a largeer rate of taxation, and I believe it must be completed before he attains age 70 1/2, or is it 72?

[@ralphparker]

You should have a professional do you a forward looking tax plan to see if it makes sense and how much to do each year.

[@SK-qt1rm]

I’ve been considering converting, my issue is the RMD curve. Im at a 12%, so if I convert a portion to keep me under the 22% each year until I’m either done or 73 (RMD), I can reduce the huge required withdrawal hit in my early 80s and might put me in the higher brackets and also cause Medicare cost increased and increased social security taxes: the secondary cost of traditional IRA.

[@birdman9029]

My wife and I are 60 and we just retired. Let's assume we live to 80 years old. Our plan is to do a Roth conversion over the next 2-3 years to keep us in the 22-24% federal tax bracket. (also, remember Medicare looks back two years) while we rent a small home in a no state tax state (like FL, NV or WA). Our pensions give us regular income of $170K/yr. and will not be taxed by the state of CA (because our primary residence would be in the no tax state during this time) which will pay for much of our 6 month and one day vacation in the no tax state. We think doing a Roth conversion makes sense in particular if the rollover money in the Roth is going to heirs. In other words, we are probably not going to touch the money, ever... AND we have the cash to pay the taxes now WITHOUT using the rolled over money. (In our case, we have plenty of money saved up.) Our heirs will get to keep the money in the inherited Roth for 10 extra years after we die... then they can take half out at years 9 and 10 (because the market could go down in year 10)... tax free!! Those last 10 years will probably double the account value, or more... which in 20 years would be much, much higher than the account value now. In summary, we are paying the federal tax NOW on a much lower amount so our children pay nothing 30 years from now (when tax brackets WILL be higher) on an account that is MUCH higher. What does everyone think of this plan? Thank you.