Very refreshing to hear a balanced view compared to others with the conversion hammer seeing everything as a mail. I agree with everything said on this video with only one comment regarding paying more tax with one or the other strategy. You can pay more tax DOLLARS by deferring and still come out ahead if the tax rate is lower and the only reason for paying more tax dollars is the account has grown. You may not know which gives you the highest after tax net worth until 10 years after you die when your heirs empty the account. I have decided not to convert for the following reason. I Retired this year and in top of 22% bracket but under IRMAA. I want to take advantage of the next 7 years before SS to spend down some of my taxable account as well as reposition the balance to municipal bonds, stocks, and cash value LI to free up space to then start to withdraw from tax deferred accounts to live on along with SS, taking advantage of the standard deduction and low tax brackets. I also intend to move to a tax free state which further boosts the benefit of not converting. Once RMDs kick in at 75 I will have a bit lower balance (depending on market performance vs the withdrawals) and the standard deduction and tax brackets would have had 12 years of inflation adjustments which further helps. Then I can pay tax slowly over many years in future inflation adjusted dollars. I do acknowledge the widow trap changes the dynamic some but I am challenged to make a decision based solely on that factor.

Another reason not to convert prior to age 65 is if your health care is through the ACA.

I would love to see a case shown of someone that is not sick etc, but never should convert simply because their taxes are low their entire remaining life, so no reason to convert. Another words, they're in the 12% bracket or lower forever by taking their IRA withdrawals and their social security. Of course you could always partially convert in that case if there is any room in a year at a 10% or 0% rate.

@muth1997

23 күн бұрын

the RMDs changes the discussion completely...a couple million in your IRAs and your RMD is huge