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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A listener says, “Eventually, one spouse will pass before the other, which will often catapult the survivor into a significantly higher tax bracket. Shouldn’t a Roth strategy take this int...
Sammy, a 51-year-old retiree, is seeking advice on how much she should convert from her traditional IRA to a Roth IRA each year to avoid jumping tax brackets and minimize the taxation of her social se...
James explores the nuanced aspects of Roth IRAs, shedding light on intricacies that can confound even experienced investors. Through a listener question from Manfred, a retiree contemplating a $50,000...
The 2025 rule changes for Roth and traditional IRAs could mean more money for your retirement. But you have to pay attention to reap the rewards....
How much should you save in pre-tax accounts vs. post-tax accounts? Joe Anderson, CFP® and Big Al Clopine, CPA spitball on the "age plus 20" rule for retirement savings, Roth 401(k) contributions ...
Learn to make smarter financial decisions with math-driven strategies. James Lange shows how Roth IRA conversions and tax planning can maximize wealth and reduce taxes....
Today on Your Money, Your Wealth® podcast 495, Joe Anderson, CFP® and Big Al Clopine CPA spitball on three different listeners’ strategies for paying the tax on a Roth conversion now, to...
I was sitting around the campfire last weekend, enjoying the warmth of the flames and the comforting crackle of burning wood. My cousin, a financial advisor brimming with enthusiasm, leaned over and b...
So many retirement questions have no right answers. They’re simply judgment calls. In this episode, we’ll explore whether it makes sense to switch to a Roth 401K. Don’t listen to fin...
What is an exchange fund and is it a good thing if you have a lot of capital gains like Bryan in New York? That's today on Your Money, Your Wealth® podcast 492 with Joe Anderson, CFP® and Big ...
These retirement savings accounts, which are often pitched to young investors, can be a good option for older and retired workers....
Discover three effective strategies for using Roth IRAs and Roth 401(k)s in retirement to maximize tax-free income, manage withdrawals, and secure your financial future....
It might seem counterintuitive, but there are scenarios in which it would make sense to lock in lower marginal tax rates....
If you've been a good saver and face large required minimum distributions (RMDs), then you need to plan for how to head off or limit higher Medicare premiums....
Gary is a 73-year-old with $8 million in savings. Despite having substantial assets, he’s concerned about missed opportunities for Roth conversions as he faces significant required minimum distr...
Consider the idea of not converting any, some, or all of your Traditional IRA to a Roth IRA and go against the conventional wisdom....
Is timing the market when you withdraw money from your retirement accounts or do Roth conversions an effective strategy to minimize tax and maximize returns for YMYW listener Robert? That’s toda...
So many retirement questions have no right answers. They’re simply judgment calls. In this episode, we’ll explore whether it makes sense to switch to a Roth 401K. Don’t listen to fin...
Roth conversions can be an effective strategy for creating tax-free income in retirement. But Roth conversions can also get complex, and if you’re not careful it’s easy to make mistakes th...
Here are some strategies for utilizing whole life or indexed universal life policies to convert your traditional IRA to a Roth with LTC protection....
Retirement savers can reap benefits in the conversion if they are able to pay a tax now....
The are smart ways and terribly taxing to get funds from an Inherited IRA to a Roth account. Keep reading to learn how to get more tax free income from your inheritance....
I met the blogger Frugal Professor last week when he traveled to my area for a family gathering. I learned from his blog post that he earned over $5,000 tax-free by transferring a Roth IRA to Robinhoo...
Listener Nael opens up a discussion about Roth conversions. There are benefits to doing Roth conversions, but can you do too many? Are there any downsides to Roth conversions? Reaping the tax benefits...
The Roth 401(k) vs. traditional 401(k) decision can mean the difference between higher taxes now or in retirement. It's your choice....
How much do retirees really spend in retirement? Does the Social Security Primary Insurance Amount (PIA) continue to rise with inflation? Is all the talk about higher future tax brackets just fear-mon...
All offer great tax breaks as you save for retirement. In addition, there are 403(b), SEP and SIMPLE plans and more. But don't worry. It’s hard to go wrong....
last year I finally decided to retire in early 2025 I was thinking getting a couple months in so I could max my ROTH IRA. Then got to thinking "ill get my last check for my vacation time in January so...
If your company offers a Roth 401(k) you can convert your traditional 401(k) to pay lower taxes in retirement....
Photo credit: jb Many times it is among the best of ideas to establish a Roth IRA for your child. This way, your child can benefit from the long-term growth in the account and have a very good head st...
Should Mike in Virginia keep using his IRA money to pay the tax on his Roth conversions? How do you do a Roth conversion when you don’t have the money to pay the tax? That’s PeterLemonJell...
Healthcare subsidies are like a tax break and should always be optimized, right? That seems like an easy question that should have a straightforward answer. But the correct answer is, “It depend...
Lean into a Roth IRA well before your “day one” of retirement....
Photo credit: diedoe I occasionally receive this question: Can I make a non-deductible IRA contribution, and then shortly after convert the IRA into a Roth IRA? My income is too high for me to make a ...
A couple compares the differences between a Traditional IRA and a Roth IRA. Selecting the right Individual Retirement Account (IRA) is a crucial step for your financial future. With various options av...
Key changes to Roth 401(k) account rules may affect your tax planning and retirement savings....
Looks like fintech is working its magic. Based on an inquiry from a reporter, my colleagues JP Aubry, Yimeng Yin, and Angie Chen have been fooling around with data on holdings of Roth IRAs from the Fe...
Kyle and his fiancée are in their 30s, have done a great job saving, and are in a high tax bracket. Would it make more sense for them to contribute to their 401(k)s or Roth 401(k)s for retireme...
I think I've come upon an answer for my Roth conversion riddle. FYI, I have a large tax-deferred ("always taxed") IRA. I'm 63. I'm going to be a widower maybe in my early 70s (incurable disease proces...
In addition to increasing the diversity of your portfolio, adding a non-traded REIT within your Roth IRA allows the resulting dividends to grow tax-free....
Are there ever times when going all Roth isn’t the best strategy? How do you determine the break-even point on doing Roth conversions? That’s today on Your Money, Your Wealth® podcast ...
The previous postSplit-Year Backdoor Roth IRA in FreeTaxUSA, 1st Yeardealt with contributing to a Traditional IRA for the previous year and recharacterizing a previous year’s Roth IRA contributi...
Let’s compare traditional IRAs, traditional 401(k)s, Roth IRAs and Roth 401(k)s. Which might work best for you could depend on your income and tax status....
The best way to do abackdoor Rothis to do it “clean” by contributing *for* and converting in the same year — contribute for 2023 in 2023 and convert in 2023, contribute for 2024 in 2...
You may have contributed to a Roth IRA and then realized later in the year that you would exceed the income limit. You recharacterized the Roth IRA contribution as a Traditional IRA contribution and c...
The previous postSplit-Year Backdoor Roth in H&R Block, 1st Yeardealt with contributing to a Traditional IRA for the previous year and recharacterizing a previous year’s Roth IRA contributio...
The best way to do a backdoor Roth is to do it “clean” by contributing for and converting in the same year — contribute for 2023 in 2023 and convert in 2023, contribute for 2024 in 2...
Roth conversions can be a powerful retirement-planning strategy. Watch this clip from Retirement University’s online course, “Tax-Saving Strategies in Retirement” to learn how Roth c...
Listener Drew asks about a tax strategy for juggling capital gains and Roth conversions. While it can be a complicated question – especially when large accounts are involved – James provid...
Two hypothetical examples of Roth conversions made at different times (all at once vs as you age) show a stark difference in what could be left for your beneficiaries....