Vanguard's Guide: Timing Your Roth Conversion

Reported about 1 month ago

Vanguard provides insights into when to consider converting a traditional IRA to a Roth IRA, emphasizing the importance of comparing current and future tax rates. They suggest using a Break-Even Tax Rate (BETR) analysis to determine if a conversion is beneficial. This method can reveal potential tax savings that might not be apparent through traditional comparisons. Factors such as paying conversion taxes from a taxable account or having a non-taxable basis in the IRA can significantly impact the decision, making a Roth conversion more appealing even in varying financial circumstances.

Source: YAHOO

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