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DH & I are moving to a state with no state income tax (WA). We are also in the process of beefing up our retirement savings, so I am looking into Roth IRAs.

My thinking is that we should concentrate on funding our Roths instead of our traditional IRAs while we are living in WA (i.e. put 75% of our allocation into the Roths and 25% into the traditional IRAs). I think this would be wise because we are likely to move again, possibly to another state, within 5-7 years. In this way we can take advantage of the lack of income tax on the taxed contributions to the Roth IRAs. Is this smart thinking?

I will be ending my employment within a few months of moving to WA, and will be rolling my 403(b) into a traditional IRA. Should I take the money out of that traditional IRA, pay the taxes, and fund the Roth instead? I have about $6800 in the 403(b), so I don't know if I could just cash it out and pay taxes on it, to put into the Roth...or if it would be smart to do so.



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