Do you have a large retirement account balance? A Roth IRA conversion may make sense for you.

If you have a large retirement account balance (e.g. IRA, 401k, 403b) a Roth conversion may make a lot of sense in retirement. For some people, a Roth conversion can drastically reduce income taxes over their lifetime (and their children’s lifetimes).

Many people, upon retirement, suddenly find themselves in a low tax bracket. For example, assume you retire at age 65. You no longer have any earned income. Additionally, you have over five years before you’re required to begin withdrawing money from your pre-tax retirement accounts like IRAs, 401ks, and 403bs, etc…

This creates a great planning opportunity!

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The Asset Must Match The Liability!

I have a multiple choice question for you:

You have some cash sitting in your bank account. You’re buying a house in 12 months and want to put 20% down so you’ll need the cash in a year. What should you do with the cash in the interim?

  1. Buy stocks. After all, stocks are up “yuge” over the last 12 months.
  2. Stocks might be a little risky, so invest the cash in bonds instead.
  3. Buy a 1-year CD.
  4. Leave the cash in your savings account.

cue the Jeopardy music….
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What can we learn from Bitcoin?

For those of you that follow Bitcoin, you know it’s had a volatile couple months. In early-June the price of a Bitcoin hit about $3,000 at which point many articles were written about how high it could go, etc… It then fell over $1,000 down to about $1,900. That’s a 35% drop in about 1 month (see chart below) before recovering once again. That is not the interesting part….


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