A couple in their early 60s with $1.3M in IRAs faced $2.4M in lifetime taxes. An optimized Roth conversion strategy cut that to $516K and eliminated taxes for their heirs, saving $1.8M total. Timing and amount matter far more than most people realize.
In their early 60s.
$1.3 million
About $2.4 million
About $450,000 reduction in lifetime taxes
About $516,000
So this is a real story about one of our clients. This client, in their early 60s, came in with 1.3 million in IRAs. And let's look at the three different scenarios they could end up with if they did nothing. Their lifetime taxes were projected to be about 2.4 million between them and their heirs. If they went with the typical strategy that financial planners use, which is to convert only to the top of their tax bracket, that would have reduced their lifetime taxes by about 450,000. Not bad, but when we optimize the timing and amounts, we nearly eliminated the RMDs. We cut lifetime taxes down from 2.4 million to about 516,000 and eliminated taxes completely for their heirs. Total reduction in tax about $1.8 million. This is all using the same money, the same period of time, but wildly different strategies. Roth conversions reward early intentional moves.
