Money & Economics

[bigredfish]

On the 401K to Roth conversion, you have to do the math and ballpark your taxable income in later years when you start drawing from the 401K vs taking the hit now. I had my highest earnings last year so it didn’t make sense. Later on though, combined with SS, that 401K draw will add to your total income from SS and whatever else, and potentially put you in a higher bracket the way I understand it.

I’ll let ya know as I learn more, meeting with an advisor I trust later this week.

 

[David L]

Yeah, we have some of our Cash in a Money Market account in Fidelity paying almost 4%, will move it out when that goes away/down. Trying to keep, like you, a certain percentage in Cash (Liquid) accessible. You are definitely doing right by not keeping your eggs all in one basket. Speaking of eggs, a dozen cost more than gas now...crazy...

My son has physical cash stowed away, I told him that may become worthless one day.

 

[David L]

On the 401K to Roth conversion, you have to do the math and ballpark your taxable income in later years when you start drawing from the 401K vs taking the hit now. I had my highest earnings last year so it didn’t make sense. Later on though, combined with SS, that 401K draw will add to your total income from SS and whatever else, and potentially put you in a higher bracket the way I understand it.

I’ll let ya know as I learn more, meeting with an advisor I trust later this week.

Yeah, I am curious too. Thanks...

Since the taxes have already been paid on a ROTH and you only pay taxes on the Interest made for withdrawals or RMDs, shouldn't this not affect your tax bracket much unless you have a huge ROTH?

 

[David L]

On the 401K to Roth conversion, you have to do the math and ballpark your taxable income in later years when you start drawing from the 401K vs taking the hit now. I had my highest earnings last year so it didn’t make sense. Later on though, combined with SS, that 401K draw will add to your total income from SS and whatever else, and potentially put you in a higher bracket the way I understand it.

I’ll let ya know as I learn more, meeting with an advisor I trust later this week.

One thing I hated when we talked to financial advisors, they would not talk about taxes, they always said you have to check with a tax advisor...I want an One Stop Consultant

 

[Sybertiger]

I have a chunk making more that the current rate of inflation. Of course it's "at risk" and I have the privilege of paying tax on my "profits" so another whammy. When the great reset happens most likely anything at all related to gubermint whether City/County/Federal will make it become monopoly money.

 

[bigredfish]

Looking into suspenders and a sharp blade to haul that gold around ...

Yeah, I am curious too. Thanks...

Since the taxes have already been paid on a ROTH and you only pay taxes on the Interest made for withdrawals or RMDs, shouldn't this not affect your tax bracket much unless you have a huge ROTH?

No taxes on the Roth earnings.... I think
How Roth IRA Taxes Work

But I would take a huge hit on the 1X allowed conversion from the 401K to Roth

 

[looney2ns]

One thing I hated when we talked to financial advisors, they would not talk about taxes, they always said you have to check with a tax advisor...I want an One Stop Consultant

The advisor I've had for several yrs does this, everything he proposes to me, takes into account how to manage taxes now and in the future. He's done me well.

 

[garycrist]

Tax Rate	For Single Filers	For Married Individuals Filing Joint Returns	For Heads of Households
10%	$0 to $10,275	$0 to $20,550	$0 to $14,650
12%	$10,275 to $41,775	$20,550 to $83,550	$14,650 to $55,900
22%	$41,775 to $89,075	$83,550 to $178,150	$55,900 to $89,050
24%	$89,075 to $170,050	$178,150 to $340,100	$89,050 to $170,050
32%	$170,050 to $215,950	$340,100 to $431,900	$170,050 to $215,950
35%	$215,950 to $539,900	$431,900 to $647,850	$215,950 to $539,900
37%	$539,900 or more	$647,850 or more	$539,900 or more
Source: Internal Revenue Service

Here are the brackets for 2022. Only the portion that is above a bracket is taxed at that rate, not the whole portion!
So the 1st. $20550 (Married filing jointly) = 0
next $20550-$83550 @%12

Pay your taxes it's cheap!

 

[David L]

Looking into suspenders and a sharp blade to haul that gold around ...





No taxes on the Roth earnings.... I think
How Roth IRA Taxes Work

But I would take a huge hit on the 1X allowed conversion from the 401K to Roth

Thanks...just make sure they are qualified...don't touch it for the first five years...

 

[Sybertiger]

My son has physical cash stowed away, I told him that may become worthless one day.

Might not be a bad idea to keep 5 or 10 grand in the gun safe. I rarely use real currency but if CC machines go down then maybe have some cash on hand just in case.

 

[tigerwillow1]

Here are the brackets for 2022. Only the portion that is above a bracket is taxed at that rate, not the whole portion!

Those tax rates are about 10% higher if you're receiving social security and are below 85% SS taxation. For married filing jointly the 85% SS taxation happens pretty close to the start of the 22% tax bracket, so as an approximation, if you're receiving social security and filing jointly, the 10% tax rate is really 20%, and the 12% tax rate is really 22%. I'd expect a similar situation for filing single or HOH, just never crunched the numbers for those.

 

[tigerwillow1]

Might not be a bad idea to keep 5 or 10 grand in the gun safe.

I totally agree. Back in the recent days of zero interest, having this security was penalty free. Now that the $5k to $10k can earn some real interest, there's a cost for the security of having cash on hand.

 

[David L]

Might not be a bad idea to keep 5 or 10 grand in the gun safe. I rarely use real currency but if CC machines go down then maybe have some cash on hand just in case.

I think that is my son's thought. Or if there is a run on the Banks...we have all witnessed how people react in fear, all those who ran to the Clot Shot...

 

[Gargoile]

Welp, still waiting on you smart guys to mention your mastermind plan to protect your nestegg and assets.

Buy real estate.
Dividend Re-investments.

Change your mindset from being a consumer to a producer.

 

[Gargoile]

My son has physical cash stowed away, I told him that may become worthless one day.

It's good to have some cash on hand. That way when the gov turns off the credit and debit cards and limits ATM transaction to under $50. You will still have cash on hand to buy what you need and not have to ration.

 

[Gargoile]

Looking into suspenders and a sharp blade to haul that gold around ...





No taxes on the Roth earnings.... I think
How Roth IRA Taxes Work

But I would take a huge hit on the 1X allowed conversion from the 401K to Roth

You have to fund it with taxed dollars, and not pretaxed dollars. After that everything you earn is tax free. Anyone over 50 can put in $7,500 into a Roth.

If you are over 55 you can use the Rule of 55, and after that money is taxed, then put it in your Roth. Or find a way to do a Backdoor Roth funding.

 

[samplenhold]

You should always have two weeks' worth of cash that you can get to within five minutes. You should have one month's worth of cash that you can get access to within 48 hours.

When I was living in Nigeria, I had $20k USD, 10k Euros, and about $10k worth of Nira in our safe. That was to get us out of Nigeria if the SHTF. In five years never had to use it, but did come close once.

 

[bigredfish]

You have to fund it with taxed dollars, and not pretaxed dollars. After that everything you earn is tax free. Anyone over 50 can put in $7,500 into a Roth.

If you are over 55 you can use the Rule of 55, and after that money is taxed, then put it in your Roth. Or find a way to do a Backdoor Roth funding.

Yes I’ve had a Roth for some years, just haven’t put much in it. You are allowed a 1x 401K to Roth conversion I believe. No real limit. But you pay tax on the distribution of the 401K at the time of conversion.

Must-Know Rules for Converting Your 401(k) to a Roth IRA

You should be able to roll over your 401(k) into a Roth IRA, but be prepared to pay taxes when you make the transition. When you withdraw funds, they won't be taxed.

www.investopedia.com

 

[bigredfish]

Not every day you see Blackrock back down.
Luv our Gov!

BlackRock Caves To DeSantis Over ESG

ZeroHedge

ZeroHedge - On a long enough timeline, the survival rate for everyone drops to zero

www.zerohedge.com

 

[David L]

Not every day you see Blackrock back down.
Luv our Gov!

BlackRock Caves To DeSantis Over ESG

ZeroHedge

ZeroHedge - On a long enough timeline, the survival rate for everyone drops to zero

www.zerohedge.com