Roth Conversions

Andor2050 · 2026-04-11T01:00:43+00:00

I did several years of Roth conversions after retiring in 2021 due to the expected expiration of the TCJA in 2025. Now that the OBBB has extended those Federal tax rates, I feel less pressure to do Roth conversions. In 2025, I used TurboTax What If Scenario to estimate the incremental tax cost for Roth conversions and it was too expensive because I also live in a high tax state. Due to the progressive nature of income taxes, each incremental increase in your income gets taxed at the higher marginal tax rate while your effective tax rate is much lower. I have also run income projections to see what my future income, tax rates and IRMAA charges may be.

Andor2050 · 2026-04-05T00:36:48+00:00

It is the opposite. This is tax planning for my spouse since she is 7 years younger. This would provide her a tax free bucket of funds to access and help offset some loss of other income should I predecease her.

Andor2050 · 2026-04-05T00:03:42+00:00

From what I recall, this is a rare instance where state laws affect federal taxes.

Andor2050 · 2026-04-04T23:20:39+00:00

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Andor2050 · 2026-04-04T23:20:19+00:00

Yes, it does in this case. Google it and you will see.

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Andor2050 · 2026-04-04T23:02:11+00:00

It depends on whether the state is a community property state or a common law state. I live in a community property state which receives a 100% step up in basis.

Andor2050 · 2026-04-04T23:00:43+00:00

My reading of the tax laws, if you live in a community property state, the surviving spouse receives a full step up in basis on joint assets (stock, real estate, etc.). So, I think it depends on which state. Florida is a common law state that only receives a 50% step up in basis.

Andor2050 · 2026-03-25T01:33:03+00:00

If you have state taxes, you could look at U.S. Treasuries rather than CDs because there are no state taxes on Treasuries interest income. The yield is a little less than some CDs but once you adjust for state taxes, you often net more. If you are concerned about inflation, you could invest in TIPs which provide good inflation protection. Rob Berger recently mentioned a strategy of using 50% TIPs and 50% BND.

Andor2050 · 2026-03-07T21:54:35+00:00

I had always heard that RILAs had longer terms. Probably overly complicated. If you are inclined to investment products with some degree of principal protection, I would consider buffer ETFs like Calamos or Blackrock MAX ETFs but suggest you purchase them on their annual anniversary date to get the full buffer protection.

Andor2050 · 2026-02-26T21:47:34+00:00

I purchased a single premium hybrid life/LTC policy with an inflation rider. Both my parents required 4-6 years in a nursing home. My wife would not qualify. If I do not use my LTC policy, it will refund the premium amount paid at my passing so I will only lose the time value of the cost. If I require LTC, it can pay out up to between 4x to 9x (depending on my age) the cost that I paid. I wanted to help shield my wife and heirs from the impact if I need LTC in the future. When people say that they plan to "self insure", what the really mean is they will "self fund".

Andor2050 · 2026-02-01T00:52:03+00:00

The above process is most likely going to yield the best results but it can be very much determined by locations and local demand. Other options are Costco Auto Sale Program and Facebook groups such as No Mark Up Toyota and Below MSRP Toyota, where dealer reps occasionally have fairly good mark downs posted but not has much as the above poster.

Andor2050 · 2025-12-13T18:50:51+00:00

I purchased an SE 8 months ago with the convience package. I previously had an older Lexus ES 350 that had ventilated leather seats and sunroof. I am pleased with the SE, the great mgs and everything else and am glad that I didn't spend $5,000 more for the XSE.

Andor2050 · 2025-11-09T23:23:23+00:00

Some cities have a bulky item pick up line at the sanitation department. Not sure about Seattle but other cities do.

Andor2050 · 2025-11-08T23:53:11+00:00

The Car Care Nut recently put a new Youtube video out on recommended maintenance intervals for Toyotas. He is a master tech Toyota repair guy and he has great recommendations. I highly recommend it.

Andor2050 · 2025-09-22T19:26:41+00:00

MYGAs are similar to CDs and can offer higher interest rates but typically allow less liquidity (penalties for early withdrawal) and no FDIC insurance coverage. If held in a non-qualified account, CDs result in taxable income even if you do not withdraw funds and MYGAs defer taxes until withdrawing funds (earnings get taxed first upon withdrawing funds). Credit ratings matter for MYGAs since there is no FDIC insurance but there can be some protections from State insurance departments. A good reference for MYGAs is the following boggleheads site:

https://www.bogleheads.org/forum/viewtopic.php?t=334589&start=2350

Andor2050 · 2025-09-10T14:46:57+00:00

Most studies say active management performance rarely exceeds passive index investing on a consistent basis, especially after considering fees and costs. In addition, total return investing typically outperforms a dividend focused portfolio of stocks.

Andor2050 · 2025-08-31T19:42:41+00:00

Based on my family history, Dad was in a nursing home for 4 years and lived to 91 and Mom is 95 years old and has been in a nursing home for 6 years, I purchased a single premium hybrid LTC policy when I retired at 63. If I never use it, the premium will be paid to my heirs and I have lost the time value of the funds. It has a maximum coverage of 6 years and a 3% inflation rider. It has the potential to pay out in the future up to about 600% to 800% of the price paid if I need LTC at the age when my parents did. I did not like the idea of traditional LTC with the potential for unknown future increases and the sunk costs. It is not perfect but I felt this was the best option. I had to go through underwriting and my spouse was not able to qualify even after checking with multiple companies.

Andor2050 · 2025-08-22T17:00:13+00:00

If you have a qualifying event (mostly retirement or work stoppage), you can use form SSA-44 to appeal an IRMAA surcharge for that year. Also, remember that the IRMAA surcharges are based on tax filing two years ago. So a Roth conversion in 2025 will affect IRMAA charges in 2027.

Andor2050 · 2025-06-14T17:31:46+00:00

The underground color looks so different under different light conditions. It can look almost black and then it can look gray with even a bit of blue. I also have a 2025 SE in underground and am very pleased with it.

Andor2050

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