bada bing
Full time employment: Posting here.
I did quite a bit of modelling and "what iffing" around Roth and tIRA balances. What I found for my situation is that there is an absolute dollar balance optimum for tIRA balances rather than a percentage split. That is because of the stair-step nature of tax brackets and various cliffs built into tax code. For my situation (single, no dependents, pension), it seems like I get/got no benefit from tax deferral that results in greater than $1.1m-$1.2m in tax deferred balance at RMD age. Lots of guesstimates & moving targets in my assumptions. I have 7 years until pension and SS and 9 years until RMDs. I'm right at my target $1.2M in tIRA now, so conversions will probably be targeted towards holding that balance with whatever the market returns. If the market meets historic averages and I did nothing, I could easily be in the highest bracket of my life at age 80. First world problems, but that doesn't mean it shouldn't be optimized.
One thing I lucked into was the ability to use backdoor and mega-backdoor conversions for the last 10 years of work. Roth balances are "more is always better", but you have to evaluate the cost to get the money in. With respect to my situation, all the money currently in my Roth is just money that would have been in my taxable savings if not for the backdoors.
I did quite a bit of my modelling using Right Capital software, which I found useful for the exercise. It is a subscription software package targeted at financial planners, but an individual can get access for a fee by going through some of the smaller financial planners that offer individual access for a set fee.
One thing I lucked into was the ability to use backdoor and mega-backdoor conversions for the last 10 years of work. Roth balances are "more is always better", but you have to evaluate the cost to get the money in. With respect to my situation, all the money currently in my Roth is just money that would have been in my taxable savings if not for the backdoors.
I did quite a bit of my modelling using Right Capital software, which I found useful for the exercise. It is a subscription software package targeted at financial planners, but an individual can get access for a fee by going through some of the smaller financial planners that offer individual access for a set fee.