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Avoiding a Roth conversion tax surprise

The first article in this series discussed the princi­pal differences between traditional and Roth IRAs. Last week we identified both the benefits and tax consequences of converting a traditional IRA to a Roth IRA, both of which have important and long-lasting implications for an individual’s finances.

In general terms, converting from a traditional IRA to a Roth IRA can be attractive for those who don’t expect a significant decline in their tax rate in retirement. Even for those who do, however, Read more

Should you convert to a Roth?

A Roth IRA conversion is the process of transferring funds from an existing traditional IRA to a Roth IRA. The decision to convert presents an interesting quandary for investors. When you convert to a Roth IRA you’ll be accelerating income taxes on the conversion amount in exchange for tax-free growth and the opportunity to avoid required minimum distributions upon reaching age 70½. This permits more of an investor’s wealth to grow tax-free and for a longer period of time. It’s not an easy decision and clearly the Roth conversion is not for everyone. To make a smart choice investors need to Read more

A crisis of confidence

Since the depths of the financial crisis we have witnessed a stock market that has more than doubled and substantial improvements in other key measures of economic health. Yet a recent survey conducted by The University of Chicago and Northwestern University business schools revealed that American’s confidence in the economy continues to slide. One of the main reasons cited by the study’s authors is a growing distrust of the country’s financial institutions and Read more