How Much Waiting To Convert ACTUALLY Costs You In 2026

Hey, look, your retirement tax strategy isn't about doing one Roth conversion or not. It's more like playing a game of chess against the IRS. I've studied over thousands of conversion plans from our actual clients to see how much money they would have lost out on by waiting to start on their plan. And the number came out of that research was shocking. So in this video, I want to show you the biggest lesson that you can learn from these 2,000 different plans I've looked at, how much waiting actually costs you, and how to look at your tax strategy like a chess grandmaster. Because by waiting, you lose out on more than just dollars. First, let me show you the 5 chess pieces that are crucial to any well-built conversion plan. Because we're not just talking about a single transaction. A Roth conversion isn't something you do in an afternoon in December, click a few buttons and call it good. Just like in chess, the conversion itself may be one move, but the value comes from where all the pieces were before that move was made. And every strong conversion plan I've ever studied has really these 5 pieces that are sitting in a good position. The first piece is your rook. And if you played chess, You know that the rook can move as far as it wants to in a single move, but early in the game, it's stuck behind the pawns. So it's not much help until the pawns actually have gotten moved out of the way. And that's what happens maybe from February through April, because that rook is maybe your CPA. During tax prep season, your CPA is buried in filings, deadlines, extensions, client returns. So if you want to coordinate estimated payments, withholding, and conversion timing properly, You need to move that piece into place and have that conversation way before they get swamped. If you miss that window, you might end up having to wait until next year or do something in a very rushed manner. The second piece is, we'll call it like your bishop, which can move diagonally across the board. It, it spots lines that aren't obvious if you're only looking straight ahead. And Roth conversions work the same way. Most people look at how much they should convert, but the bishop looks at what makes the most sense to convert. The bishop is, we'll call it your investment advisor. They look at which holdings are down, which assets have the strongest recovery potential, and how it really impacts the rest of your portfolio and your conversions. Those are diagonal questions. And identifying the right assets takes real evaluation across your portfolio and it needs time. It's not a decision you want to rush until the beginning of December like most people do, because by then kind of the cake's already baked on the investment stuff and you lose out much opportunity that you could have had, had you started earlier. The third piece, we'll call it, is your knight. This piece, a lot of people just simply overlook because until all of a sudden it suddenly changes everything because it doesn't move like anything else on the board. It doesn't go straight or diagonal. It jumps. And for your Roth conversion strategy to be truly solid, you need to plan for those jumps because when you convert, you're not just moving money from one retirement account to another, you're moving it from pre-tax to post-tax. And that move changes how that money behaves in the future in ways most people don't really expect. And that's maybe where your estate attorney comes in, because when your assets change, it could affect how assets are inherited, how beneficiaries experience the money, and whether the documents you already have still do what you think they do or what you want them to do. So before you do a conversion, your broader estate plan may need just a quick review as well. And look, that's especially crucial when it comes to the next piece, which is your king. In chess, the king is the piece the entire strategy is built around. Ground protected. He can only move one square at a time, so when he gets cornered, there's not much at all he can do. So you don't win by ignoring the king or leaving him exposed, and you definitely don't win by making bold moves on one side of the board while the king is vulnerable on the other side of the board. Roth conversion planning has the same issue. A strategy can look great on paper and still fail if the person most affected by the long-term consequence isn't taken into consideration. Because this isn't just about one tax year. It's about your whole retirement. It affects all your retirement income, household confidence, and what happens once you're gone. We're going to call the king is your spouse. The sooner your spouse is not just aware of the plan, but part of the decision, the more confidently the whole thing gets executed. I've seen more plans stall because of a spouse who wasn't in the room than for almost any other reason. And finally, there's the queen. It's the most flexible piece on the board. She can move in multiple directions. She can create great advantage, but only if she has the space to move. And if you rush her into the fray, your opponent will take her out before you had a chance to create that advantage. If the board is cramped or the other pieces are in her way, the queen's power is limited. And Roth conversions are exactly that. The best opportunity may not show up in December. In fact, probably will not show up in December. It may show up when markets are temporarily up or down for each of the securities that you have. And when your income is lower than you expect, or when projections show there's still room in the current bracket. But you only get to use that opportunity if the rest of the board is ready. The queen is timing. Instead of assuming the right moment to convert is December, use timing to your advantage can make a massive difference. It lets you see when market conditions and your tax positioning actually line up, and you can only spot those when you have a full year to monitor and to act. What so many people do in Roth conversions is totally contrary to what got them to the success in the first part. Even advisors or CPAs will say, hey, just wait till December. We'll play cleanup. We'll figure it out. Look, our research has proven that December is actually the worst time of the year to convert if you consider all these different factors. And if you wait too long, the IRS will have moved their piece across the board and trap you. And if you move pieces into place in preparation, you're in a whole lot better position for checkmate. Look, our research again shows that conversions executed with as full a planning year as you have, proper coordination, the right timing, strategic investment selection, can add as much as $30,000 of value for every million dollars of Roth that you convert. Now, let me show you what happens when you move these pieces into place. Here's what it looks like for a well-executed Roth conversion strategy if it started now with a full planning period, not condensed down in just a couple of the last months that you can work in. If you happen to be watching this video and you're in the last couple months of the year, it's not a reason not to do anything. It's just to understand that you're going to need to get the most urgent things taken care of right now. Understand you're going to make less than the best decisions and then clean it up with whoever the team is that helps you to develop it once the new year starts. It's not a license to just wait till next year because that's a losing proposition also. But look, if you have that full year of planning to coordinate everything properly, it produces lifetime tax savings, could be up to $2 to $3 million. And that's, that's kind of a baseline. That's what acting looks like. Now, every plan is different and it all depends on the context and the numbers you're working with. So this isn't a prediction, but just something to show you the shape of what happens to the numbers. Because the direction is the same across the thousands of cases that we've worked on. And here's what it looks like if this person waited just even 1 year. Their lifetime tax savings drops to $1,768,649. So waiting just 1 year cost them $66,000. And over $400. Think about what you could do with that money, $66,000. Not because the plan got worse or because anything went wrong. It's just because the window was one year narrower, but that's not even the most shocking part because when we look at it as if this person waited 5 years, we see their lifetime tax saving drops to $1,400,000 and some odd thousand dollars. How, I can't tell you how many times I've had people say, look, I'm going to be retiring in a few years. I think I'll just wait till then to do this, or I'm going to be in a much lower tax bracket several years from now. So I'll just wait why didn't do it then? It never works out to be in their benefit. You can't save taxes by waiting and trying to convert a much higher tax balance. It just doesn't work. But that saving is $357,000. That's the price of not playing strategically for 5 years by delaying your retirement plan until maybe RMDs become a problem or things feel more certain, or you lose out on your biggest tax advantage over the IRS by waiting. Here's what makes the number so significant. That money comes directly out of what your family gets to keep down the road, out of what your spouse has if something happens to you, out of what your kids inherit. Instead of making a difference to them, it ends up in the hands of the IRS. And look, here's the part that surprises most people. They know that every dollar sitting in the IRA is going to be taxed at ordinary rates. And that's the deal you made when you made the contribution. The question is only when and on what amount, but while you're deciding, your account just keeps growing and every dollar of growth is a dollar the IRS gets a larger piece of, it's also another dollar that you're paying fees on, internal and external fees. I had a client who put it better than ever. So he said, it feels good to look at your spreadsheet and say, I've got all this money, but then you have to stop and say, well, wait a minute, that's not all my money. It's the government's money too. And he's right. That number on your statement, it's a meaningful portion of it isn't yours. That's why it's crucial to take action while you still have time on your side, but It has to be strategic action, and that starts with knowing your numbers. So to get a projection of your lifetime tax bill, head on over to the RMD calculator link below. We'll send you a prediction based on your actual numbers and real life, what over 2,000 different client plans have produced that we've studied. And to find out how to really use market timing to your advantage, go to this next video.