Craig Wear explains why Roth conversion plans need yearly reviews instead of reactive, aggressive moves. Adjust your target based on conversions already made, rerun projections with actual data, and track tax-adjusted net worth. His clients typically save over $3 million in taxes this way.
So let's say you've already spent years underconverting and suddenly you feel behind. The fix is not to panic convert extra aggressively at this point. Instead, take your conversions into account and run your projections forward based on where you are now. Your destination number is going to be different now, but it'll still give you a strong reference point for what your conversion plan is. Look, over time, you're going to want to update your plan with the actual numbers and rerun your projections and make sure that they're still going to get you to your destination, which is the total number of lifetime tax that you avoid, obviously watching what your tax-adjusted net worth does over that timeframe. But for most of our actual clients, that number is over $3 million of tax avoidance. And most of them end up with similar or the same, or maybe slightly higher tax-adjusted net worth at the end of the game plan.
