I tried out the new Retiree Portfolio Model beta version over at bogleheads and its new feature is fantastic. You can keep your overall asset allocation constant and the program will automatically preferentially put your bonds in tax deferred first and then it will load up your choice of either Roth or taxable with any overflow bonds.
For the spreadsheet savvy, this will take their Roth Conversion analyses to a higher level. Warning - if you don't love spreadsheets, RPM is not the place to start, the quirkiness of the order of input and general layout and complexity of the program will confuse and frustrate you.
Also, RPM doesn't understand that when you sell something in taxable, you have to pay taxes on the gains. So I looked at how cash short each year was and made a separate estimate of taxes that I included as extra expenses. For me, those extra capital gains taxes in the years prior to RMDs starting diminish the benefit of Roth conversions quite a bit. Once RMDs start, there will be enough cash, so any asset sales prior to that are taxes that neither I nor my heirs would otherwise ever have to pay.
I made a separate file for my heirs and went through the 10 year liquidation period since I am interested in maximizing their situation. If one of us really lives to 90, the kids will be near retirement, so I guesstimated their SS and savings and added it to the hoped for inheritance. To do the withdrawals from tax deferred in the program, you have to both Roth convert from tax deferred and withdraw from Roth to taxable.
Not sure when it will become the released version, but the beta is available at:
https://www.dropbox.com/s/maqf1i8qk7eoh5o/Retiree Portfolio Model v21.2 Alloc Beta.1.xlsm?dl=0
For the spreadsheet savvy, this will take their Roth Conversion analyses to a higher level. Warning - if you don't love spreadsheets, RPM is not the place to start, the quirkiness of the order of input and general layout and complexity of the program will confuse and frustrate you.
Also, RPM doesn't understand that when you sell something in taxable, you have to pay taxes on the gains. So I looked at how cash short each year was and made a separate estimate of taxes that I included as extra expenses. For me, those extra capital gains taxes in the years prior to RMDs starting diminish the benefit of Roth conversions quite a bit. Once RMDs start, there will be enough cash, so any asset sales prior to that are taxes that neither I nor my heirs would otherwise ever have to pay.
I made a separate file for my heirs and went through the 10 year liquidation period since I am interested in maximizing their situation. If one of us really lives to 90, the kids will be near retirement, so I guesstimated their SS and savings and added it to the hoped for inheritance. To do the withdrawals from tax deferred in the program, you have to both Roth convert from tax deferred and withdraw from Roth to taxable.
Not sure when it will become the released version, but the beta is available at:
https://www.dropbox.com/s/maqf1i8qk7eoh5o/Retiree Portfolio Model v21.2 Alloc Beta.1.xlsm?dl=0
