I am a long time lurker that is unusure of what to do these days. I am a single 32 year old and am 100% in equities. Yes I am feeling some pain right now. I am wondering now with my IRA being half of what it was a year ago is now a good time to convert it or at least a piece of it to a ROTH IRA?
My Stats: 2008 is the first year I was able to max out my 401k and ROTH IRA. I am also contributing $10,000 into a company ESPP which gives a 15% discount. My salary is $75,000. Debt wise, I am 5 years into a 30 year fixed 5% mortgage with $150k left on it, $19k of student loans at 4.6% and $5k on a credit card at 0% until September 2009. Right now I am living on a very tight budget to make this happen. As of today my ROTH is $20k, Rollover IRA is $35k, 401k is $35k, tax accounts with stocks is $40k and I do not have an emergency fund.
My current Rollover IRA balance is $35k. I was thinking of converting $10k-$15k of it this year. Would this make sense? How is the income treated? Could I offset it with capital losses from stocks? I am still holding a few from the internet bubble in a taxable account.
At the beginning of this year I was looking at the age of 50-55 for an early date. The downturn in the market might change that.
Any other comments on my situation.
Thank you for your responses.
My Stats: 2008 is the first year I was able to max out my 401k and ROTH IRA. I am also contributing $10,000 into a company ESPP which gives a 15% discount. My salary is $75,000. Debt wise, I am 5 years into a 30 year fixed 5% mortgage with $150k left on it, $19k of student loans at 4.6% and $5k on a credit card at 0% until September 2009. Right now I am living on a very tight budget to make this happen. As of today my ROTH is $20k, Rollover IRA is $35k, 401k is $35k, tax accounts with stocks is $40k and I do not have an emergency fund.
My current Rollover IRA balance is $35k. I was thinking of converting $10k-$15k of it this year. Would this make sense? How is the income treated? Could I offset it with capital losses from stocks? I am still holding a few from the internet bubble in a taxable account.
At the beginning of this year I was looking at the age of 50-55 for an early date. The downturn in the market might change that.
Any other comments on my situation.
Thank you for your responses.