Roth Conversions: When They Make Sense—and When They Don’t

A Roth conversion can unlock tax-free growth and flexibility in retirement, but the decision hinges on timing, tax brackets, and cash flow.

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A Roth IRA offers several distinct benefits. Your money grows tax-free in a Roth IRA and qualified withdrawals are also tax-free. Moreover, you don’t need to take required minimum distributions (RMDs) from a Roth IRA.

RMDs are minimum amounts of funds the IRS requires you to withdraw from tax-deferred accounts like traditional IRAs and 401(k)s every year once you reach age 73. So your money could effectively grow tax-free throughout your lifetime in a Roth IRA.