Mike MilliganFounder and CEO, 1.oak Financial · Founder and CEO, 1.oak Financial

5 Retirement Mistakes Nobody Wants to Make

20 Nov 2025 · 1 min

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In this segment of Mike Milligan’s YouTube video “5 Retirement Mistakes Nobody Wants to Make,” Milligan warns viewers about the “tax time bomb” that arises when retirees defer all retirement savings into traditional 401(k)s and IRAs without any Roth component. He explains that waiting to pay taxes can lead to a sudden surge in required minimum distributions (RMDs) around age 73, which triggers a large tax bill and higher Medicare premiums in the late‑70s and 80s. To avoid this shock, Milligan advises starting Roth conversions now—paying taxes while rates are relatively low—so that future retirees benefit from tax‑free withdrawals and lower Medicare costs. He frames the strategy as paying a “tax toll” while the rates are on sale, contrasting it with the costly alternative of waiting until the end of life.

Chapters

The tax time bomb. It, uh, most people say, I'll pay taxes later and later, and they wait. And why is my Medicare premium so high? That's what happens, like, when they come into me when they're 78, 79, 84 years old. If you're stuffing every dollar into a traditional, uh, 401 or IRA with zero Roth strategy, you're back. You're basically saying, let future me deal with it. That's fine until future you hit 73 and RMDs show up with a side of tax shock and higher Medicare costs. So how do we fix that? We need to start mixing in Roth conversions now. So you trust me, you're 80, the 80-year-old version of yourself is going to thank the 67-year-old version of you who paid some taxes. And so think of it like paying the tax toll while rates are still on sale versus Just waiting and waiting and waiting.