There may be a few years in your 60s when you have more tax-planning flexibility than you realize.
Hello, my dear reader,
There’s a quiet window in many people’s financial lives — and it tends to slip by unnoticed…
It’s those years between the moment you stop working and the moment other major retirement-income sources come online. In that gap, your taxable income may be, temporarily, lower. And lower taxable income can open planning doors that may not exist later.
Let me explain why. When someone stops working, income changes shape. And often there’s a period — frequently in the 60s, before RMDs (required minimum distributions) begin — when there’s room to evaluate a Roth conversion.
Carefully explained: a Roth conversion generally moves money from a Traditional IRA into a Roth IRA, and the taxable portion of that conversion is generally included in your income for the year. That’s why tax brackets matter so much in this decision — and why waiting until RMDs begin can limit some of that flexibility. Social Security timing, withdrawals, and future RMDs are pieces that need to be considered together, never in isolation.
But I want to be very clear, because it matters: this is not saying ‘everyone should do a Roth conversion.’ The opportunity isn’t the same for everyone, and a conversion isn’t automatically beneficial — it has to be evaluated based on each person’s individual tax situation. The point here is different, and simpler: recognizing that the years around retirement can offer planning options that may not exist later on.
So the reflection I’ll leave you with is this:
“Retirement planning isn’t only about saving money. It’s also about deciding when and how that money becomes taxable income.”
The years around retirement can be some of the most important for tax planning.
Don’t wait until there’s no flexibility left.
With clarity, Pri ✨
Educational content only. This information is not tax, financial, investment, or retirement advice. Tax rules and individual circumstances vary. Consult a qualified professional before making financial or tax decisions.
