I converted my 401k to a Roth IRA to avoid higher taxes in the future. I'd rather pay taxes now than be stuck paying taxes on my retirement income when I'm 59 and living off my savings.
Pre-tax contributions may help reduce income taxes in your pre-retirement years while after-tax contributions may help reduce your income tax burden during retirement.
Yes, how many times have I heard "income in retirement will be lower". Not true. I'm so lucky I maxed out my Roth when working. You have the BEST financial insights and advice.
Thanks for highlighting the impact of taxes on retirement savings! Understanding tax brackets is super important for retirement planning. - Lipika - Team Evan Carmichael
A recent personal realization: The funds in your taxable brokerage and tax deferred accounts are not entirely yours. The government is your not no silent partner, and they will get their share at one point or another. Plan accordingly.
Best rationale to tax plan I have seen on RUclips! In 2025 the LAST of my multiple-year conversion strategy will result in the only remaining pretax account becoming a post-tax Roth account. Future taxes saved? Incalculably large amount.
Thank you for your explanations. I want to do a backdoor Roth IRA for my spouse. We file married filing jointly. She does not work. My income is under 100K. I can contribute 7K to a Roth IRA in her name. Can I also contribute 20K to a non-deductible IRA in her name and then immediately do a Roth conversion of the 20K to her Roth IRA for a total of 27K? Her IRA currently has zero dollars and this is her only IRA.
If you and your wife are over 50 you can contibute $8000 each to a Roth IRA in 2024. $7000 each if you are under 50, not more. If you want to do a backdoor Roth you should be aware of the prorata rule explained in this video: ruclips.net/video/99qFiue6Sak/видео.htmlsi=s2HgLytBLqm8gtBU
@@FinancialFastLane She is under 50 and I am over 50. It seems like the prorata rule would not come into play in this instance since her current IRA (the only one that she has) currently has zero dollars in it. If I contribute after tax money to her IRA and immediately move the money to her Roth IRA, then her After tax IRA would be left with zero dollars. Is this allowed? Or do they count my IRA's with hers?
I am in Kansas City, will be retiring from work at 70 in 2.5 years. I don't have ton of money but would like to have some financial planning for my accounts and Social Security. Do you work with Missouri residents? If not can you recommend a financial planner in this area?
7:35 The ROTH 5-yr rule. Is it just for UNDER 59 1/2 ?
There is more than one 5 year rule. Here is a video on that ruclips.net/video/Uyz4Wq12Me0/видео.htmlsi=h30UG_fecxLY2fIy
I converted my 401k to a Roth IRA to avoid higher taxes in the future. I'd rather pay taxes now than be stuck paying taxes on my retirement income when I'm 59 and living off my savings.
Pre-tax contributions may help reduce income taxes in your pre-retirement years while after-tax contributions may help reduce your income tax burden during retirement.
Yes, how many times have I heard "income in retirement will be lower". Not true. I'm so lucky I maxed out my Roth when working. You have the BEST financial insights and advice.
Thanks for highlighting the impact of taxes on retirement savings! Understanding tax brackets is super important for retirement planning. - Lipika - Team Evan Carmichael
Wishing I had used the Roth IRA option earlier in my life and had more that’s already been taxed. I would’ve focused there a bit more.
A recent personal realization: The funds in your taxable brokerage and tax deferred accounts are not entirely yours. The government is your not no silent partner, and they will get their share at one point or another. Plan accordingly.
Best rationale to tax plan I have seen on RUclips!
In 2025 the LAST of my multiple-year conversion strategy will result in the only remaining pretax account becoming a post-tax Roth account. Future taxes saved? Incalculably large amount.
Thank you! Blessings!
Terrific overview. Missed one gotcha step: Surviving spouse tax jump before beneficiary RMDs.
True! Thank you for your comment.
I wish I had seen this 10 years ago. I switched to Roth TSP from regular a year ago and wished I had much earlier.
Always great information Lane!
I appreciate your videos
Great info. And to think we had a revolt for a 2% tax on tea at one point
Thank you for your explanations. I want to do a backdoor Roth IRA for my spouse. We file married filing jointly. She does not work. My income is under 100K. I can contribute 7K to a Roth IRA in her name. Can I also contribute 20K to a non-deductible IRA in her name and then immediately do a Roth conversion of the 20K to her Roth IRA for a total of 27K? Her IRA currently has zero dollars and this is her only IRA.
If you and your wife are over 50 you can contibute $8000 each to a Roth IRA in 2024. $7000 each if you are under 50, not more. If you want to do a backdoor Roth you should be aware of the prorata rule explained in this video: ruclips.net/video/99qFiue6Sak/видео.htmlsi=s2HgLytBLqm8gtBU
@@FinancialFastLane She is under 50 and I am over 50. It seems like the prorata rule would not come into play in this instance since her current IRA (the only one that she has) currently has zero dollars in it. If I contribute after tax money to her IRA and immediately move the money to her Roth IRA, then her After tax IRA would be left with zero dollars. Is this allowed? Or do they count my IRA's with hers?
@@JohnToscano-eg7bd Yes, it is allowed! That will work.
@@FinancialFastLane Thank you! I really appreciate all you do for all of us!
I am in Kansas City, will be retiring from work at 70 in 2.5 years. I don't have ton of money but would like to have some financial planning for my accounts and Social Security. Do you work with Missouri residents? If not can you recommend a financial planner in this area?
@@ahmadghosheh3104 Yes, we serve clients all around the country. Please contact our office to schedule an appointment 480-550-6556.
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Remember there is no escape 😂 we all F.