PRAP / Investment
09-02-2018 | 12:21 PM
#31
Gets Weekends Off
Joined: Mar 2018
Posts: 3,633
Likes: 209
Not limited to a once a year thing but it takes time to do the conversion. I max out my 401k by the mid April to get maximum VEBA spillage. As soon as I hit the annual max, I request the conversion forms. Plan on the conversion taking at least a month to complete.
Since the new tax law no longer has the Pease/PEP phaseout, I'm considering converting all of my pretax money to Roth. I ordered the forms a couple of weeks ago and have them in a drawer at home. I'm just waiting for the next market dip to send them in. This will be pretax and B/C funds that are still taxable.
Since my income stream through retirement will allow me to never touch those funds, I want to get them into a Roth to a) avoid RMDs starting at 70 1/2 and 2) allow my children to inherit the funds tax free. I'm getting ready to put documents in place where the funds will go into a trust on my death and RMDs will be based on my childrens' ages.
Since the new tax law no longer has the Pease/PEP phaseout, I'm considering converting all of my pretax money to Roth. I ordered the forms a couple of weeks ago and have them in a drawer at home. I'm just waiting for the next market dip to send them in. This will be pretax and B/C funds that are still taxable.
Since my income stream through retirement will allow me to never touch those funds, I want to get them into a Roth to a) avoid RMDs starting at 70 1/2 and 2) allow my children to inherit the funds tax free. I'm getting ready to put documents in place where the funds will go into a trust on my death and RMDs will be based on my childrens' ages.
09-02-2018 | 12:31 PM
#32
Gets Weekends Off
Joined: Mar 2006
Posts: 5,213
Likes: 14
From: guppy CA
At retirement, Roth 401k > Roth IRA.
My wife and I withdrew our money from TSP when we each retired from the military. The path for that money was:
TSP > traditional IRA > Roth IRA
I have no intention of leaving my 401k as a 401k after I retire. Roth IRAs are less restrictive.
Also, you cannot place an IRA in a trust while you're alive. My conversion plan is:
At death, Roth IRA > Roth IRA in a trust
Sorry to have obfuscated the topic.
Here's an old Kiplinger article on the subject of Roth 401k/IRA: https://www.kiplinger.com/article/re...ributions.html
09-02-2018 | 12:50 PM
#33
Gets Weekends Off
Joined: Mar 2018
Posts: 3,633
Likes: 209
My wife and I withdrew our money from TSP when we each retired from the military. The path for that money was:
TSP > traditional IRA > Roth IRA
My wife and I withdrew our money from TSP when we each retired from the military. The path for that money was:
TSP > traditional IRA > Roth IRA
TSP > traditional IRA > Roth IRA
My wife and I withdrew our money from TSP when we each retired from the military. The path for that money was:
TSP > traditional IRA > Roth IRA
Did you happen to have any tax free contributions (due to combat zone tax exclusion) in there? My primary brokerage won't accept the tax free funds since they don't have a means to consider the basis. I don't really mind the offerings, but would like to have the option for more...
09-02-2018 | 03:57 PM
#34
Gets Weekends Off
Joined: Mar 2006
Posts: 5,213
Likes: 14
From: guppy CA
Did you happen to have any tax free contributions (due to combat zone tax exclusion) in there? My primary brokerage won't accept the tax free funds since they don't have a means to consider the basis. I don't really mind the offerings, but would like to have the option for more...
Scottrade split the funds into two IRAs - I'm surprised that your brokerage won't do that. We put the taxable TSP into traditional and then rolled it into our Roth IRAs.
07-10-2019 | 08:24 AM
#35
Gets Weekends Off
Joined: Feb 2011
Posts: 3,866
Likes: 0
Well, just like the old adage, "you don’t know if you picked the right airline until you retire" the same is gonna be for all of our diligent investment strategies. There’s simply too much money in our retirement accounts for Congress not to eventually take it all.
07-10-2019 | 07:49 PM
#40
Gets Weekends Off
Joined: Mar 2018
Posts: 3,633
Likes: 209
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