Roth Conversions Done Right: What Great Advisors Know That Software Doesn’t
May 14, 2025
Discover the intricacies of Roth conversions as advisors are urged to look beyond software tools. Learn about crucial considerations like future tax brackets, RMDs, and charitable giving. Understand why these conversions can be seen as 'tax insurance' rather than a definitive strategy. The discussion emphasizes the importance of personalized advice for clients, ensuring they grasp the complexities involved in their tax planning. It's all about effective communication and tailored strategies in the world of Roth conversions!
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volunteer_activism ADVICE
Don’t Rely Only on Software
Advisors should not rely solely on software to make Roth conversion decisions.
Use software as a tool but understand core principles deeply to provide better advice.
question_answer ANECDOTE
Complex Plan Simplified
A client planned a complex Roth conversion strategy with software, expecting high tax savings.
James identified a simpler, effective alternative using qualified charitable distributions without software reliance.
volunteer_activism ADVICE
Question Before Converting
Always ask if there is a good reason not to do a Roth conversion before recommending it.
Consider tax brackets, required minimum distributions, and charitable giving as reasons to avoid conversions.
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In this episode of Root Ready, James shares how advisors should think about Roth conversions—starting with the basics and not just relying on software.
Software can help with numbers, but it can’t see the full picture. James explains why Root advisors use software as a tool, not the final answer.
He talks through key things to consider before doing a Roth conversion, like future tax brackets, RMDs, charitable giving, and income thresholds. You’ll also hear why Roth conversions are more like “tax insurance” than a perfect plan.
If you want to better understand when—and when not—to recommend Roth conversions, this episode is for you.
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Advisory services are offered through Root Financial Partners, LLC, an SEC registered investment adviser. This content is intended for informational and educational purposes only and should not be considered personalized investment, tax, or legal advice. We do not provide tax preparation or legal services. Always consult with your CPA or attorney regarding your specific situation.
Viewing this video does not create an advisory relationship with Root Financial. We only provide advisory services to clients under a written agreement.
Investment strategies discussed may not be suitable for everyone. All investments involve risk, and past performance is not indicative of future results.
Any opinions expressed are as of the date of recording and are subject to change.
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