ROTH IRAS DO NOT HAVE TO BE A YOUNG PERSON’S GAME - Pt. 5

June 18, 2019 Blog No Comment

5 reasons to consider a Roth IRA conversion in your 50s.

Reason 5: YOUR TAXABLE INCOME WILL BE LOW THIS YEAR

Let’s say you are in the U.S. military and will be serving in a combat zone. Most of your pay will be tax-exempt because of your employment. This might provide the perfect opportunity to convert some of the money in your Traditional IRA to a Roth IRA without owing a lot of taxes.

This isn’t the only circumstance where you might have tax-free income, but it is the most common one. Other low-tax circumstance could include a job change or job loss, being in early retirement and living off taxable investments such as bonds that generate little taxable income, or having high medical bills expenses.

If the opportunity strikes, take it.

FUN FACT: The Roth IRA was named for its legislative sponsor, William V. Roth Jr., Republican senator from Delaware. The Roth IRA became available in 1998 as part of the Tax Relief Act of 1997. Mr. Roth served as a senator from 1971 to 2001.

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