12-19-2018, 10:04 AM
I know many say it is wise to do " back door" conversions to roth. They also say to convert while in a low tax bracket. How about this scenario....Suppose you are in 24% tax bracket federal and 6% state tax. Suppose you are also expected to be in the same tax bracket in retirement. Also, may be in higher bracket (if fed raises tax rates in future) Also suppose you expect to be heavily pension and traditional IRA when retired. So, almost all taxable income when retired.. My thinking - You need tax diversity when when retired. This will provide more flexibility. I know the math is overly simplistic, but $1 dollar of traditional IRA is at least close to 70 cents in a roth. The taxes on roth conversion would be paid from taxable broker account and "savings" during the year. I am not looking for a huge conversion....just small...in the name of "flexibility" in the future...