Week 42 Day 5: Roth Conversions: Paying Tax Now to Avoid It Later

A Roth conversion moves money from a traditional IRA (taxed later) to a Roth IRA (tax-free later). You pay income tax on the conversion now, but all future growth and withdrawals are tax-free forever....

A Roth conversion moves money from a traditional IRA (taxed later) to a Roth IRA (tax-free later). You pay income tax on the conversion now, but all future growth and withdrawals are tax-free forever. If you expect higher tax rates in the future, a Roth conversion can save substantial money.