Craig Wear, CFP® explains that when considering a Roth conversion strategy, purchasing life insurance can be important if you anticipate needing additional income in the future beyond pensions, Social Security, rental or other passive revenues. The decision hinges on whether you will need portfolio-derived income later and when that need will occur.
The biggest reason why you would want to consider purchasing life insurance as part of your Roth conversion strategy comes down to potentially a need that you will have for income later outside of your pension, Social Security, rental, real estate, oil and gas revenues, all those kinds of things. Outside of all that, is there going to be a point in time where you're going to need money from your investment portfolio? And if the answer to that is yes, then you should at least now you got to figure out, do I need extra income? And then the big question is, okay, when will I need it?
