If one has a high numbers in either traditional or sep Ira, is it still worth it to do backdoor Roth due to pro data rule? Curious to learn what you guys think about that
Backdoor Roth Conversion question
byu/Upstairs-Sentence-87 inpersonalfinance
Posted by Upstairs-Sentence-87
3 Comments
Depends on your tax rate and how much you’d have to pay. A better option is rolling into a 401k if it’s allowed
Generally not
Backdoor roth: https://www.whitecoatinvestor.com/backdoor-roth-ira-tutorial/ https://www.whitecoatinvestor.com/fix-backdoor-roth-ira-screw-ups/
It’s worth it. I’m doing a small amount of roth conversion each year so there’s minimal, manageable tax impact. It will be nice in retirement to have all that tax free money that you don’t even pay taxes for capital gains/dividends. For me, it will cost a few hundred dollars each year, and that is manageable.
Also, do your conversions when markets are down—not at all time highs like now.