Should I do a Roth conversion before retirement?
For a lot of people, yes, but only if you judge it by your lifetime tax bill instead of this year's. On the Real Personal Finance podcast, CERTIFIED FINANCIAL PLANNER professionals Scott Frank and Nick Covyeau argue that paying some tax on purpose today can protect tens of thousands of dollars for your family later. The trick is picking the right window and filling the right bracket.
Stop optimizing for the lowest tax bill this year
Nobody wants to hand the IRS more than they have to. But Scott and Nick point out that most people make tax decisions one year at a time, and that habit quietly costs them. A Roth conversion moves money from a traditional IRA or 401(k) into a Roth. You pay income tax on the converted amount now, and in exchange that money grows tax free and comes out tax free later.
Seen through a single tax year, that looks like a bad deal. You're volunteering for a bigger bill. Seen across a lifetime, it can be the opposite. If you're going to be in a similar or higher bracket in retirement, or if required minimum distributions will push you there, paying at today's rate on today's smaller balance is often cheaper than paying later on a much bigger one.
The hosts frame taxes as a long game to manage, not a yearly chore to minimize. That reframe is the whole episode in one sentence.
"Optimizing for the lowest tax bill this year often costs you more over your lifetime."
Two conversion runways: ten years versus three to five
Scott and Nick compare two distinct timelines, and which one you're on changes the plan.
The ten-year runway. This is someone still in their core earning years with a decade or so before retirement. There's time to convert smaller amounts each year, stay inside a target bracket, and let the Roth balance compound for a long stretch. Conversions here are steady and boring, and that's the point.
The three-to-five-year window. This is the pre-retirement stretch, often after a big salary ends but before Social Security and required distributions kick in. Income drops, so the lower brackets open up. The hosts describe this as a prime opportunity, but it's short, so the annual conversion amounts tend to be larger and the planning has to be tighter.
If you're not sure which runway you're on, count the years until your paycheck stops. That number drives everything else.
Filling a tax bracket without spilling into the next one
The core technique the hosts walk through is bracket filling. You figure out how much room is left in your current marginal bracket after your regular income, then convert roughly that much and no more. The goal is to fill the bracket you're already in rather than pushing dollars into a higher one.
A simple version of the math: take the top of your target bracket, subtract your expected taxable income for the year, and the remainder is your conversion budget. Do that every year for the length of your runway.
The hosts also stress watching for temporary income drops. A sabbatical, a job change, a year of lower bonuses, or the first year after leaving work all create room in low brackets that won't be there again. Those years are when a conversion does the most good, and they're easy to miss if you're not looking for them.
Who this is really for
Scott and Nick close on the reason behind all of this. The point isn't to win an argument with the IRS. It's to make sure the money you worked for ends up with the people and causes you care about instead of being taxed away in a lump later.
Roth conversions tend to make the most sense when you expect to be in the same or a higher bracket in retirement, when you have cash outside the IRA to pay the conversion tax, when you have a real runway before required distributions, and when you want to leave tax-free assets to heirs. They make less sense if you'll be in a much lower bracket later or you'd have to pull the tax money out of the IRA itself.
Either way, the hosts recommend making the decision with your lifetime tax picture in front of you, not just this year's return.
What to remember
- Judge a Roth conversion by lifetime taxes, not this year's bill. Paying some tax now can save far more later.
- Figure out your runway: a ten-year stretch allows small steady conversions, while a three-to-five-year pre-retirement window calls for larger, tighter moves.
- Fill your current tax bracket and stop. Convert only the amount that keeps you from spilling into the next bracket.
- Years with a temporary income drop are prime conversion opportunities. Plan for them ahead of time.
- The goal is protecting money for your family and causes, so build the plan around where you want the money to end up.
People also ask
How much should I convert to a Roth each year?
The hosts recommend converting enough to fill the tax bracket you're already in without crossing into the next one. Subtract your expected taxable income from the top of your bracket, and that's roughly your conversion budget for the year.
When is the best time to do a Roth conversion?
Any year your income is temporarily lower than normal. The stretch between leaving work and starting Social Security or required distributions is especially valuable, but so is a sabbatical or a low-bonus year mid-career.
Is a Roth conversion worth it if I'm close to retirement?
It can be. Scott and Nick describe a three-to-five-year pre-retirement window as a prime opportunity because income usually drops. The window is short, so the annual amounts are bigger and the planning needs to be more precise.
Based on the Real Personal Finance episode "Playing the Long Game with Lifetime Taxes" with Scott Frank and Nick Covyeau, released August 20, 2026.
