Please check the validity of transferring (converting?) RMDs to a ROTH. Is there earned income, as well that qualifies one for a ROTH contribution?
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We checked, and one can convert traditional IRA money into a Roth because the original IRA contributions were earned income. Learned a lot about the difference between conversions and contributions - different rules.
But does that count as part of the RMD? Or does that stack on top of the total taxable income?
Ah, looks like youāre correct and I guess another argument with my husband. He read some article and I didnāt research his conclusion sufficiently. I gather the point of the article is to convert non-RMD IRA amounts to move it into tax free Roth, and to reduce future RMDās. But converted funds cannot be withdrawn tax free for five years. And the RMDās push us into the next tax bracket.
However, the IRS specifically prohibits you from converting any required distributions into a Roth IRA. You can convert money that isnāt a required distribution, but the law is unambiguous that you cannot do so with an RMD
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I believe ou can withdraw the initial amount converted at any time, you donāt have to wait 5 years.
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Do you have any Roth? If so, the 5 year clock starts when that opened.
Be careful that you take your full RMD (for that year) first, before converting anything into the Roth.
I do not already have a Roth which is why I discussed opening a new one, husband does. I already noted the need to take the RMD before converting more.
LOL husband doesnāt believe me because he read his opinion in an AI chat response, and I only read mine in Morningstar. And of course here.
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How will energy costs come down?
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If in your shoes, I would probably make out a visual with pros and cons on various decisions with these financial decisions. That way he can put his information down, you put your information down, and then the truth/fact checking.
In my case, DH and I probably donāt take advantage of every tax benefit available, but we do pretty good. I have enough to keep up, and for me, it is easier for me to manage spending than some incremental gains on our immediate or future bottom line. Also I have a DH that relies on my financial expertise (DH is an engineer and I have two graduate business degrees) along with our FA - and this combination has us ācomfortableā financially.
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Posters are free to start a conversation about energy costs and politics in the political forum but itās off topic to this thread. TIA
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Thread topic - age to retire and how much one needs; some people choose to work longer to build up enough money to not live a smaller life in retirement, with desire to travel until get to no-go years. Energy costs (electricity, gas, oil/propane) do vary around the country, and some people desire to live in a city with public transportation and may not even keep a car - find it cost effective for Uber, Taxi, other. Energy costs affect airlines/jet fuel costs.
Some people decide to share a vehicle with spouse when both are retired - but we both happily keep our vehicles in our go-go years.
We have not downsized our home because until we move, it is good for us to keep our current home - the savings in homeowner taxes and insurance (and any other costs) do not mitigate the cost to try and sell and buy in our community, along with the emotional and time cost included. Our home is built energy efficient, 2 X 6 walls ā wonāt find that unless another custom house (which ours is).
My husbandās car needed a new transmission. Makes me mad because it had 114,000 miles, the warranty was 100,000.
The car was out of commission for a month. We are both retired and while it worked to have one car, Iām not ready for that right now.
I want to keep his car for a year and get a new one. Right now both cars are the same age and mileage. Iād like to stagger that some. One car with higher mileage to drive around town. The other for road trips.
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Itās a no-brainer for me to keep my 2006 Odyssey (103K miles, about 2K added per year). My husband and I mostly do things together OR alone when the other hangs home. In theory we could share a car, but probably weād start to realize how much we are both out separately. Canāt pretend I would not enjoy parking in the center of the garage, which I gleefully do when he is out of town with his car parked at the airport.
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Dh and I run our cars into the ground (finally sold my beloved 2002 Focus last year). We have talked about when to go down to one car. Both of our current cars are more than 10 years old so we are trying to decide which one we will get rid of next. The decision will be which one gives out first. Once we are down to one car, hopefully in several years, we will trade in the other and get something close to brand new and stay with one.
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