Short excerpt from a YouTube video by Craig Wear, CFP® offering practical advice on Roth IRA conversions focused on age considerations and use of discretionary/cash funds. The speaker explains using excess take-home pay to fund conversions and cautions that those under age 59½ without outside funds may not need to prioritize conversions.
About $40,000.
Under 59½.
So if you had $10,000 of extra money you were not putting into your 401 that now is coming into the checkbook, then that $10,000 could be used to convert, generally and roughly speaking, $40,000. So if you're under 59 and a half and you don't have the cash just sitting in a brokerage account or money market or savings, that's one way to start doing something about the challenge that you got. So that's reason number one. When you're too young and you don't have any outside funds, or you don't have any discretionary income, probably don't need to worry about it. The other is on the other end of the scale, still related to age.
