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Gary asks:

This year (1988) my wife and I will be earning between $105K and $110K. Would a ROTH IRA be advisable or should we both stick with a regular IRA? Also, my wife has a pension from a previous job. Can this be rolled over into a ROTH IRA?

You don't mention whether you're now using a deductible or non-deductible IRA. If the latter, then using a Roth IRA for your $2K contributions is virtually a no-brainer. The traditional IRA gets taxed when money is withdrawn in retirement, but the Roth won't if it's been open for at least five tax-years and you're over age 59 ½. As to converting your wife's pension, it can be done only if it's already in a traditional IRA. Whether it should be or not depends on how you'll pay the taxes due on the conversion, how long the money will stay in the Roth, what your tax rate is today versus what it will be in retirement, and the size of your estate. For some of the things you must consider concerning Roth contributions and conversions, see my analysis in this folder at:


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