Converting Funds to Roth IRA

No, nothing to do with corporate governance but since current income limitations on Roth contributions and conversions will be lifted this year, many are looking at the possibility of rolling differed compensation into a Roth IRA. The Roth IRA Conversion Evaluator from Putnam is worth a quick look. It only took me a couple of minutes to enter approximate data. Although it could be better by including your actual tax bracket, income, expenditures, etc. at least it gets you started. I thought Fidelity’s calculator was better, largely because it actually helps you estimate your cost or savings after conversion and it uses your tax bracket data.

Dissatisfied with both, I found several additional calculators at I’ll have to look at those later. See also, Conversion of a Traditional IRA to a Roth IRA:  A Simple Tradeoff of the Time Value of Money Versus an Option? from Marc Lane. I’m beginning to think it is best to convert all funds in 2010 and pay taxes in that year, rather than taking the automatic deferral to pay 1/2 in 20111 and half in 2012 when I think tax rates may well be higher.

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