Now 19 years past our first conversion, having retired at age 55.5, I'm currently very pleased with the RIRA's stock index growth since then.
Yes, the details matter but long term, do convert as much as you are willing to spend on taxes in that pre-RMD window of time. I only went to the top of our tax bracket, and now wish that I had converted a little bit extra each year. I looked at only our highest tax rate, when I could have seen that the % amount of total tax paid is a more sensible view.
For someone retiring later this year, consider doing a moderate, first conversion sooner than waiting until busy December at your mutual fund company. Then do an additional conversion when you can better see this year's total income, other than the December 10th fund dividends. The future compounded growth in the RIRA will more than compensate for a little extra tax paid only for this year.
Yes, the details matter but long term, do convert as much as you are willing to spend on taxes in that pre-RMD window of time. I only went to the top of our tax bracket, and now wish that I had converted a little bit extra each year. I looked at only our highest tax rate, when I could have seen that the % amount of total tax paid is a more sensible view.
For someone retiring later this year, consider doing a moderate, first conversion sooner than waiting until busy December at your mutual fund company. Then do an additional conversion when you can better see this year's total income, other than the December 10th fund dividends. The future compounded growth in the RIRA will more than compensate for a little extra tax paid only for this year.
Statistics: Posted by heyyou — Wed Feb 12, 2025 11:31 pm — Replies 23 — Views 1773