Quote:
Originally Posted by petsetc
An unsolicited suggestion
For those of you who either have not yet started drawing Social Security or are in a low tax bracket, you should consider doing a Roth conversion to minimize future tax liability.
JMHO
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The above is a cost minimization strategy as opposed to a wealth maximization strategy. One point to remember, is that the recovery period from the loss of tax payments is highly variable and at times needs substantial amount of time to recover.
using a 8 percent historical average return on a portfolio, and using a high tax bracket of say 35% to move a significant portion or if you aren't in a low tax bracket which many people aren't, the recovery time is almost 5 years, and that 5 years is not a guarantee, just a long term average where some periods have been substantially longer.
The current environment is one where the recovery period is definitely longer than the average.
finance guy