No. of Recommendations: 0
Greetings, ArnoldK, and welcome. You wrote:

<<So - having read a bunch of other posts - can one of you VFPs (Very Foolish Persons) tell me if I've boiled this down correctly? I'll likely be leaving my job later this year, rolling the 401K over into a traditional IRA, and expect to have considerably lower taxable family income the following year (2001) and maybe for several years after that. If I decide to start converting the traditional IRA money to the Roth, it'd be best to do that during the next few tax year(s) when we expect to be in a lower tax bracket - si? I know this is so basic to some of you, but please humor me. I'm just getting a handle on the basics! >>

If you anticipate a lower tax rate in the next few years and if that rate will be lower than what you expect it to be in retirement, then converting your traditional IRA to a Roth while you're in that lower bracket may make perfect sense. I recommend you look at this issue carefully, though, because its success does rely on your tax rate today versus that in retirement, how you will pay the taxes due on the conversion (the rollover IRA should not be used for that purpose), and the size of coupled with your desires for your estate. It's really not a "no-brainer" decision, so you must run the numbers prior to taking that step to see if it makes sense for you to do it.

Print the post  


The Retirement Investing Board
This is the board for all discussions related to Investing for and during retirement. To keep the board relevant and Foolish to everyone, please avoid making any posts pertaining to political partisanship. Fool on and Retire on!
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.