Hi, Vince Oldre, Certified Financial Planner. If you have a retirement account, like a 401k, IRA, 403(b), then you have to stick around and watch this video. The reason why is because you have what we call an asset that you have to pay taxes on at some point, which we know you’ll have to pay those taxes at age 70-and-a-half. Why? Because you have what is called required minimum distributions, but the great part about having money in those retirement accounts, is that it’s growing tax-deferred currently, and the even better benefit is you can actually move that money to a tax-free bucket. The way you can do that is what is called a Roth conversion. You can move money from an IRA 401k, 403(b), to a Roth IRA, and when you do that the money is now going to grow tax-free, and when you take it out it’s tax-free.
Oh, there’s one catch. The catch is when you move the money from a tax-deferred bucket to the tax-free bucket, you will have to pay the taxes at whatever tax bracket you’re in with the amount that you move. So why would you do that? What is the benefit of moving money to a tax-free bucket? When you have to take money out of your IRAs, like your required minimum distribution, we know that your money will have to go to a taxable bucket, meaning that you’ll have to continue to pay taxes on the interest, and the dividends, and whatever gains you might have, like capital gains taxes.
If we know you always going to let’s say remain in the 12% or the 22% tax bracket, it probably makes sense to move the money to a tax-free bucket, because you’ll have to pay it to save taxes here, as you would over here, but now it’s going to continue to grow tax-free.
By making the decision about whether or not to make a Roth conversion, and the benefits that you might have otherwise with your retirement accounts will really come to realization when you do you own retirement plan. Now make sure that you’re talking with your tax advisor, or your financial advisor, before you make any of these decision, but when you put your overall retirement plan together you will start to understand how much money you’re actually saving in the future, and currently, by doing some things like this.
The other things that will help you is understand what your social security taxes will look like. When you have less required minimum distributions, you’ll have possibly less of your social security being taxable at whatever tax rate you’re in, so there’s a lot of advantages here. It’s really hard to realize what those advantages are if you don’t do your overall retirement plan. If you need some help with that, as an extension of this video, feel free to reach out, and we will help build that master retirement plan for you. Otherwise, make sure to meet with your own financial advisor, or tax advisor, to see if any of these things make sense for your own retirement plan.
Until then, I look forward to speaking to you next time. I hope your enjoyed this video.

Moving Money To The Right Retirement Accounts | Assured Retirement Group
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