From Yahoo Finance: 2025-04-22 08:30:00

It’s never too late for a Roth conversion, even at 69. Consider future tax rates and impacts on Medicare premiums and estate plans before executing a strategy. Engage a financial advisor to navigate the complexities and nuances of the process.

Roth conversions involve transferring funds from a 401(k) to a Roth IRA, paying taxes at current rates but allowing tax-free withdrawals later. This strategy can provide flexibility in managing taxes, avoiding RMD rules, and benefiting heirs. However, it may lead to higher Medicare premiums and a sizable current tax bill.

Gradual Roth conversions can minimize tax impact but may still push you into a higher tax bracket and affect Medicare premiums and tax credits. Spreading the conversion over several years can result in significant tax savings compared to a one-time conversion, preserving flexibility for future tax management.

Consult a financial advisor to understand how a Roth conversion could impact your financial future. Use tools like SmartAsset’s Federal Income Tax Calculator to model potential tax impacts. Keep an emergency fund on hand for unexpected expenses, ensuring it’s liquid and accessible for emergencies.

Read more: With $815k in My 401(k) at 69, Is a Roth Conversion Still an Option?