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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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....
Answering reader questions about Roth IRAs and the pro-rata rule; self-directing your solo 401(k), 457(f)s, and 457(b)s; and when to do Roth conversions. The post Roth IRAs, 457(f)s, and Other Retirem...
Most people never ask or research their retirement investing to see if it is supporting predatory lenders. Discover how index funds can often obscure this....
Is it better to save for retirement in traditional 401(k)s and IRAs, or in Roth accounts? That’s today on Your Money, Your Wealth® podcast 518 with Joe Anderson, CFP® and Big Al Clopine,...
Follow this detailed walkthrough of how to report a Roth conversion in FreeTaxUSA after recharacterizing a Roth IRA contribution in the same year. Learn the Nuts and Bolts I put everything I use to ma...
Hello, My goal is to in April next year to semi-retire, mainly stop working for my current company. I want to take the 401K and my Rollover IRA and pull the money out and pay taxes upfront, and then m...
In this episode, Tammy asks about the pros and cons of doing Roth conversions in retirement to manage Required Minimum Distributions (RMDs) down the road. With $2.9 million in combined IRAs and curren...
Should Nancy in Washington take out a 401(k) loan and invest it in her brokerage account to catch up on saving for her retirement? When Joe and Big Al talk about having a balanced portfolio of various...
Can you imagine eliminating ALL taxes on your retirement income? Well, you are allowed to and it's called a Roth Conversion. What's the catch? You have to pay the taxes TODAY once and done and then yo...
The Roth or traditional 401(k) decision can be complicated for high-income professionals. Consider these factors to best protect your income. The post Should You Make Roth or Traditional 401(k) Contri...
In this episode, we're talking about the importance of a strategic withdrawal plan in retirement to keep taxes in check and set you up for long-term financial stability. Ari and I break down why a sim...
Distributions from Roth IRAs must follow a specific set of ordering rules so that the taxation (or non-taxation) is correct. The post Ordering Rules for Roth IRA Distributions appeared first on Gettin...
Mike and his wife in Tampa are 39 and 36, they’ve got nearly a million bucks saved. Are they on track for retirement? Kate in California is 55 and hopes to retire in the next couple of years. Ho...
I'm 67, retired, good income from various sources. I have a pretty significant IRA I haven't touched. Really don't anticipate tapping into it for several more years, possibly only when required minimu...
Expensive medical care in the later stages of life is an unpleasant reality for many, but it can open a window for a Roth conversion that benefits your heirs....
You might want to convert all of your savings to a Roth in one go, but you could end up paying hundreds of thousands more in taxes than you have to....
Answering questions about the Mega Backdoor Roth IRA, the right kind of financial advisor for you, side gigs and increasing your income, and whether the Trump administration is going to get rid of PSL...
Contributing to a Roth IRA is one of the smartest ways to get ahead in investing. Here are five extra reasons why. The post 5 Little-Known Uses of Roth Contributions and Conversions appeared first on ...
Including a Roth IRA in your estate plan has clear tax advantages, which can be passed along to your heirs for years to come. But if passed down incorrectly, your heirs won’t reap the full benef...
If you set up a 529 education plan for your children or grandchildren that is no longer needed for education expenses, there is a new game in town....
Does it make sense for Alex and his wife in Massachusetts to do Roth conversions now to the top of their eventual tax bracket? Steve in San Diego got serious about saving for retirement after Joe and ...
A Roth Conversion strategy may be a very helpful way to generate a tax-efficient legacy for your heirs, while reducing the overall cost. The post Pre-Death Planning: Roth Conversion appeared first on ...
I am deciding whether or not to convert. I will be working for at least 10 more years. By then my tax-deferred funds will be slightly over $2 million. I want to convert at least $250k over a 5 year ti...
Discover the opportunities and limits of modeling your Roth conversion opportunities and get 6 tips for doing better. The post Planning for Uncertainty: Why Roth Conversions Require Iteration, Not Per...
Today we're bringing back one of our most downloaded episodes:The Three Reasons for Roth Conversions. We released this back in May of 2023 and it’s already shot up to be one of the most listened...
Republican lawmakers and conservative think tanks are proposing a new type of tax-advantaged savings account. Think Roth IRAs, but not just for retirement....
The Roth conversion is a popular year-end tax maneuver for DIY retirement planners. It works just as well at the start of the year, but more people are interested in December. The move involves transf...
I'm 67, and will have to start taking out RMDs from my IRA account at 73. This will give me a big tax hit at that time and subsequently. I was thinking I could pull out $50K/year from the IRA for the ...
You have heard your colleagues talk about this “Mega Back Door Roth” thing? Or perhaps you read about it here on FAANG FIRE and thought it was some exotic, complicated, advanced strategy. ...
Answering reader questions about the Mega Backdoor Roth, Roth conversions, solo 401(k)s, individual IRAs, and what to do with an inherited IRA. We also talk about whether the Robinhood 3% match is wor...
What do you do with the pennies your money earns between the contribution and conversion to a Backdoor Roth IRA? Not much. The post Pennies and the Backdoor Roth IRA appeared first on The White Coat I...
Joe Anderson, CFP® and Big Al Clopine, CPA spitball on paying the tax on your Roth conversions on Your Money, Your Wealth® podcast number 507. If you take the money out of your retirement acco...
Today I have a guest post from personal finance enthusiast Dan Griffin. While Dan is not a practicing financial planner, he passed the CFP exam in 2010 and holds an Executive Certificate in Personal F...
Article says payoff takes too long. I'm not good with all the math, but the explanation given seems to make sense. Especially considering we never know what the tax rates will be on the future. I'm 60...
When picking which type of 401(k) or IRA is right for you, consider whether you want to save a little on your taxes now — or save a lot more on them later....
What’s a safe withdrawal rate for Wine Guy and Wine Gal in Sonoma California to have 35 years of “guaranteed” retirement spending? How aggressively should they convert their retireme...
Rob and his wife in North Carolina are 51 and 44 and would like to retire in the next 3-5 years. Are they on track, and what should they consider as far as Roth conversions are concerned once the tax ...
Roth conversions are almost a buzzword today, with many people jumping into them like they’re a guaranteed fix for tax worries—much like rushing into surgery hoping it will solve all your ...
Ever since I started saving for retirement in 1999, I’ve been a proponent of tax-deferred retirement vehicles like the 401(k) and skeptical of tax-now vehicles like the Roth IRA. Working in bank...
Prepaying income tax on a retirement account might be a good idea. Or it could be a really bad idea. Read this before pulling the trigger....
Can Ted and Georgette convert $1.6M in an inherited trust to Roth without distributing it? Should the trust own their home so they can use the home equity? Melissa was added as joint owner on her pare...
Think you might want to open a Roth IRA? Roth IRAs offer tax-free growth of your investments and no RMDs, but income limits are low and you have to wait to withdraw earnings....
When should Jack and Swan in Florida pay off their home, retire, and convert their savings to Roth for lifetime tax-free investment growth? Jennifer in Colorado wonders whether she should take taxes i...
Roth IRAs offer great tax-free income benefits, but to make the most of them in retirement, here are seven things you need to know: Contribution Limits: In 2024, you can contribute up to $7,000 annual...
The short answer is: Not at all. Roth conversions can be great tax-saving strategies … for the right people. Are you a good candidate?...