I am 69, DW 67. Both recently retired this year. Both have been receiving SS for the past couple of years now totaling about 42K. Each IRA has about 125K, 30K of which in each are in stock index funds and the rest in bond funds. Have about 300K in joint taxable account, more than 90% of that in an S&P 500 fund. No Roth accounts. We will need about 25K/yr over and above SS to cover our expenses. We are currently in 0% tax bracket based on a few different online 1040 tax calculators (either good or bad depending how you look at it). Our 32 year old son is in a much higher tax bracket and probably will stay that way. Want to leave him as low a tax burden as possible when the time comes while keeping ours as low as possible as well. My current thought is to withdraw our 25K expense needs about evenly between IRAs and taxable. Based on the calculators we would still be in either 0% or at most the 10% tax bracket, even taking into account any LTCG, dividend and interest income (which won't be that much). I've heard so much about Roth conversions, so my question is in this particular situation, would it really be worth the time and money to do Roth conversions over the next few years? We would only convert the equity positions I assume. I know our son would get tax free money from the Roths, but with my current thinking, once we deplete the IRAs any money left in the taxable would also be tax-free to him due to the step-up basis. How he invests the money (either the lump sum from taxable or over 10 years from the Roths is up to him and his financial advisor. Do you think my plan and thinking are way off base and would it still be wise to do the Roth conversions? If I left out any important info, let me know and I will add to the post. Thanks.
Statistics: Posted by drspine — Fri Dec 06, 2024 9:42 am — Replies 1 — Views 51