mountainsoft
Thinks s/he gets paid by the post
I currently have a traditional IRA that I contribute $6480 to each year. The balance is just under 100K at this point.
I am thinking about opening a Roth IRA at the start of the year and directing my $6480 contribution to the Roth each year. The traditional IRA would just sit there until we retire in five years with no further contributions. According to the tests I've run in the Flexible Retirement Planner our long term portfolio would improve with this one simple change.
The only real negative I see is that we wouldn't be able to deduct the Roth IRA contributions from our tax return. However, I used the OLT tax estimator to see what effect that would have and it looked like our tax bill would only increase about $1000. Not insignificant, but I think we could manage over the next five years.
I might convert some of the traditional to the Roth after we retire and our income level drops, but maybe not.
Are there any issues with owning both a Traditional AND a Roth IRA that I may have missed? Any other advantages to owning both?
I am thinking about opening a Roth IRA at the start of the year and directing my $6480 contribution to the Roth each year. The traditional IRA would just sit there until we retire in five years with no further contributions. According to the tests I've run in the Flexible Retirement Planner our long term portfolio would improve with this one simple change.
The only real negative I see is that we wouldn't be able to deduct the Roth IRA contributions from our tax return. However, I used the OLT tax estimator to see what effect that would have and it looked like our tax bill would only increase about $1000. Not insignificant, but I think we could manage over the next five years.
I might convert some of the traditional to the Roth after we retire and our income level drops, but maybe not.
Are there any issues with owning both a Traditional AND a Roth IRA that I may have missed? Any other advantages to owning both?