A brief advisory segment by Craig Wear, CFP® explaining that Roth conversions, when done sooner, can save significant lifetime taxes. He cautions that conversions create a taxable event—because prior tax-deferred contributions received deductions when made—but argues that for wealthy IRA holders the long-term tax savings can be substantial.
The upside about Roth conversions is you end up saving a ton of tax over your lifetime by getting it done sooner rather than later. But when you do a Roth conversion, you're taking money that you agreed with the IRS back when you did it, that you're going to get a tax deduction at the time you made the contribution, but you're not going to pay the tax till you take it out. Now you create a taxable event, and that's what everybody's afraid of. But if you do the math on it and you're an IRA millionaire and things are really valuable to you to get the conversions done.
