Roth Conversion Strategies to Protect Your Spouse's Future Tax Burden

Ready For Retirement

A listener says, “Eventually, one spouse will pass before the other, which will often catapult the survivor into a significantly higher tax bracket. Shouldn’t a Roth strategy take this into account?”
James explores several factors that could positively and negatively impact a survivor’s tax liability and what to consider when creating a Roth conversion strategy.
Questions Answered:
How can Roth conversions benefit married couples beyond tax savings?
What factors should be considered when determining the optimal strategy for Roth conversions to protect a surviving spouse?
Timestamps:
0:00 - Steve’s question
3:40 - An example
6:41 - 3 changes
12:32 - Positive impacts
15:22 - RMD calculations
16:45 - Widows tax penalty
19:46 - When to do Roth conversions
23:40 - Big age gap
28:45 - Start with a good reason
29:57 - The bottom line

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Chapters

1. Maximizing Roth Conversions for Married Couples (00:00:00)

2. Impacts of Spouse's Death on Finances (00:12:39)

3. Considering Roth Conversions for Surviving Spouse (00:19:58)

4. Evaluating Roth Conversions for Retirement (00:27:49)

5. Financial Planning Podcast Recommendations (00:34:09)