Craig Wear warns that financial planning software often misses critical factors in Roth conversions, like Medicare surcharge increases and cumulative tax impacts across years. These gaps can cost clients hundreds of thousands to millions of dollars, turning what looks like a good plan into a costly mistake.
Look, we found platforms that don't model Medicare surcharges at all. If your advisor uses this platform, and it's one of the biggest in the country, and you start doing Roth conversions, your Medicare premiums are going to go up, and they don't even model that. We found platforms that don't carry the full cumulative cost of pushing income above your current bracket through the years that follow. So these are not obscure tools. These are the tools the industry runs on. And unless a firm really focuses on this and drills down into the numbers, no one's going to know any better. And it, look, at 7 figures, we're not talking about rounding errors. It's the difference between a plan that works and a plan that looks like it works. And if you're running the public software yourself, you'll never see the gap. That's what makes it expensive. Nobody sends you a bill for the opportunity cost that you left behind. You just don't get the hundreds of thousands or millions of dollars of advantage that you're entitled to because you trusted a piece of software to give you the right information.
