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Saving income taxes is NOT the most important benefit of converting your IRAs to Roth IRAs. In most of the cases we’ve worked on, our clients will also likely wind up with higher retirement savings balances. One of the most common fears, or misconceptions that we work through with people looking into the subject of converting their IRAs to a Roth has to do with the concern about the amount of taxes paid for the conversions. However, the best question around this subject is simply, ‘Will you have more or less money later in your life because you do conversions now’? We’ve spent years in the trenches with clients and invested considerably in proprietary tools that allow us to adeptly evaluate a full range of alternatives in regard to finding the optimal strategy for converting to a Roth. With that in mind, I’d like to share some general comments about the three most common outcomes that we see: ✅ A substantial decrease in projected tax adjusted net worth: This happens when the conversion game plan is too slow, or too fast. ✅ Little-to-No-Difference in projected tax adjusted net worth: Many of the cases we work on see little change in either direction of their net worth. But for these folks, they do avoid millions of taxes, insulate themselves from future tax changes, potentially save another $80,000 in Medicare premiums, and place their heirs in a much better tax position because they converted? ✅ A large increase in projected tax adjusted net worth: When we find a potential Roth conversion candidate who has a few years before Required Minimum Distributions begin AND who is not already withdrawing large amounts from their IRAs to live on, we know we have the high probability of seeing some huge savings AND huge increases to their projected tax adjusted net worth. These are the majority of cases we work on! The outcomes are relative to the amounts one has in IRA balances, their age, income and tax status. Taxes Matter Too We have discovered through the years is that your tax savings is the largest determiner of the impact on your tax adjusted net worth. So ‘savings does matter’, but in this context. I’ve prepared a short educational video to help you understand the three ways that our clients save millions of dollars in taxes. Click through to see the drivers behind the things that grow your net worth over time when you choose the optimum Roth conversion strategy.