Roth Conversions Before and After Retirement: Are the Upfront Taxes Worth It?

Prab Marwah

November 11, 2026

You finally have time for the Scotland trip. A few nights at the Old Course Hotel, a chance to play St Andrews, and absolutely no work emails while you’re there. You’ve spent years saying “someday,” and you’d like someday to happen while walking 18 holes still sounds fun.

Then you sit down to talk about retirement and someone suggests sending another $30,000 to the IRS and California.

For a Roth conversion. Which is supposed to help you.

It’s fair to ask how that works, especially when the tax bill looks suspiciously like the money you set aside to enjoy yourself.

A conversion can be a smart move. It can also mean paying taxes sooner, at a higher rate than you needed to, with money you would rather keep available. The answer depends on your income, your age, and what you want your savings to do. Someone who plans to spend most of their retirement money may make a different choice from someone hoping to leave a large inheritance.

So before we get into tax brackets, let’s start there: Who is this money for, and when will they need it?

The households and budgets below are made up to illustrate planning decisions. They are not client stories, local averages, hotel quotes, or a particular club’s dues. A hotel reservation also does not, by itself, guarantee an Old Course tee time; access requires separate planning. [12]

The explanation you should get before anyone asks you to convert

With a traditional IRA, you generally get a tax break when you put pretax money in, and pay income tax when you take it out. A Roth conversion moves money into a Roth IRA and brings that tax bill forward. Later withdrawals can be tax-free if you meet the rules. California generally taxes the pretax amount you convert, too. [1, 2]

You can convert after you stop working. You do not need earned income, and the income limits for regular Roth contributions do not block conversions. Eligible money from a workplace retirement plan can also move into a Roth IRA, subject to that plan’s rules. [1]

What I would want to know before recommending an amount is whether paying the bill now puts you in a better position later. And whether you can comfortably afford the bill in the first place.

“Tax-free” sounds great. The price of getting there still matters.

Meet the couple who would like to actually use their retirement

Imagine David and Elena, both 70, living in Via Verde in San Dimas. Their home is paid off, they have $1.2 million in traditional IRAs, and $150,000 in cash savings. Pension and Social Security payments cover much of their normal spending, but they still draw from their savings.

They enjoy their golf club. They want dinners with friends, visits with the grandkids, and one bigger trip most years. They also know that a paid-off house can still produce an impressively unpaid roof bill.

Here are three things they want their plan to cover:

What matters to them	Their hypothetical budget
Annual club dues	$12,000, with dining and other charges budgeted separately
A special Scotland trip for two, including an Old Course Hotel stay and golf arrangements	$20,000 set aside for planning, subject to actual quotes and availability
Cash reserved for home repairs and unexpected expenses	$50,000

Those numbers don’t establish what they can afford. We still need their full spending, income, taxes, and investment picture. But they tell us what a recommendation would need to protect.

Suppose David wants to convert $100,000 because a friend recently did. If the added federal and California tax worked out to $30,000—an assumption for this example, not their calculated tax bill—paying it from savings would reduce their cash from $150,000 to $120,000.

The conversion itself moves money between retirement accounts. The tax payment is money that leaves the household.

Before telling them that’s worthwhile, I’d want to see what remains after the trip, regular withdrawals, and their repair reserve. I’d also ask how they would feel about that cash balance if the market fell next year.

Their club membership might be where they see their closest friends three times a week. The Scotland trip might be something they’ve wanted to do together for 25 years. Those are legitimate planning goals. They deserve a place in the calculation.

“Will I live long enough for this to pay off?”

This is a reasonable question, even if it feels uncomfortable to ask across a conference table.

Age matters because it helps us think about when the money might be spent. Health, a spouse’s needs, and inheritance plans matter too. There is no universal age at which conversions become a bad idea, and no standard number of years after which they automatically win.

One reason: the traditional IRA would have kept growing if you had left it alone.

Here’s a simple example. Start with $100,000, assume a 25% tax rate now and later, pay any conversion tax from the IRA itself, and let the investments double:

What you do	What happens	What you can spend after taxes
Convert now	$75,000 goes into the Roth and doubles	$150,000
Leave it in the traditional IRA	$100,000 doubles, then you pay 25% on the withdrawal	$150,000

This example assumes a tax-free qualified Roth withdrawal, identical investment growth, and no penalties, fees, required withdrawals, or other tax effects.

Same ending amount. Twenty years of growth would not change that result if all those assumptions stayed the same. Paying a lower tax rate now than later can change it. Paying a higher rate now can change it in the other direction.

That’s why I would be cautious about a recommendation that stops at “you still have plenty of years for tax-free growth.” We need to compare both choices.

What if you pay the tax from cash instead?

Now the money you use to pay taxes also needs a seat at the table. If you skip the conversion, you still own that cash. It could stay invested, pay for the trip, or cover an emergency.

In one simplified calculation, converting $100,000 and paying $30,000 from separate savings takes about 20 years to move ahead of leaving both accounts alone. That assumes 5% annual growth in either retirement account, 4% after-tax growth on the retained savings, and a 25% future tax rate on traditional IRA withdrawals. At year 20, the conversion is ahead by only about $599.

That is an illustration of the assumptions, not a forecast for David and Elena. It leaves out spending, required withdrawals, Medicare effects, and other tax interactions. Actual retirement modeling needs those items. The returns and tax rates are constant assumptions, not predictions; the figures are not adjusted for inflation.

Change the future withdrawal tax assumption to 30%, and the same model favors converting after the first year. That is a very different answer from changing one input.

When you see a projected break-even age, ask what could move it. You should know whether the result holds up if returns are lower, you need the money earlier, or your future tax rate is different.

Already retired? Your spending gets counted first

Back to David and Elena. If they need IRA withdrawals to cover part of their regular life, those withdrawals belong in the tax estimate before we work out how much to convert.

So do any extra withdrawals for Scotland. If they fund the trip from cash instead, that changes the cash they have left to pay conversion taxes. Either way, the trip belongs in the plan.

This is where an otherwise appealing tax strategy can run into real life. Filling a tax bracket with conversion income may look fine until you add the money the couple needs to spend.

There are other costs to check. Conversion income can make more of their Social Security taxable federally. It can also increase Medicare premiums through an income-based surcharge called IRMAA. Medicare generally looks at income from two years earlier, so the premium increase can arrive well after the conversion. If both spouses have the relevant Medicare coverage, both can be affected. [5, 6]

That doesn’t mean a conversion that triggers higher Medicare premiums is automatically wrong. It means we need to count those premiums when deciding whether it pays off.

For this couple, I’d compare converting nothing, converting a smaller amount, and converting more. Every version should include the same spending goals. A strategy that only looks better because we deleted the vacation is not answering their question.

Still working? The better opportunity might be a few years away

Now imagine Maya and Rob, both 60, living near Claremont Village. They plan to retire at 63. They have two salaries today and expect less taxable income once they stop working.

Their retirement wish list includes a longer stay in Italy, more weekday rounds of golf, and helping their daughter with a down payment. They don’t want to discover that paying conversion taxes during their highest-income years made those plans harder.

The first comparison I’d make is converting now versus waiting until after retirement. If there is a stretch of lower-income years before larger withdrawals begin, that could be a less expensive time to convert.

Could be. A pension, investment income, and withdrawals for living expenses can fill that space faster than people expect.

The government also eventually requires withdrawals from traditional IRAs. These are called required minimum distributions, or RMDs. Under current law, the applicable starting age is 73 for people born from 1951 through 1959 and 75 for those born in 1960 or later. [3]

For Maya and Rob, those dates help define the planning window. They do not tell us how much to convert.

If they use Covered California before Medicare, we also need to check whether conversion income would reduce their health-insurance assistance. A lower income-tax rate is less exciting if the move also creates a much larger insurance bill. [4]

What changes if the money is mostly for your children?

Consider a third hypothetical couple: Anne and Michael, both 75, living in San Marino. Their income and other assets comfortably cover their lifestyle, including travel, club expenses, and a reserve for future care. They expect much of their traditional IRA to go to their two adult children.

Their daughter is a physician in Pasadena. Their son lives in Brea and earns substantially less. They want to help both children, but the tax cost of inherited IRA withdrawals could be different for each.

That makes “leave as much as possible to the kids” a more involved question than comparing account balances.

Many adult children must empty an inherited IRA by the end of the tenth year after the owner’s death. Inherited traditional IRAs can also require annual withdrawals during that period, depending on when the owner died and the beneficiary rules. [7]

Imagine receiving a large traditional IRA while you are already in your highest-earning years. Those taxable withdrawals can pile on top of your salary. If your parents could have converted at a lower tax rate, doing so might have left you more to keep.

But that argument may be less compelling for a child with lower income, or one who expects to retire during the withdrawal window. Their future tax circumstances deserve an estimate, not a guess that everyone will pay the top rate.

Inherited Roth IRAs also have withdrawal rules. For many adult children, the ten-year deadline remains, although annual withdrawals generally are not required in years one through nine under that rule. Qualified withdrawals are tax-free; earnings may still be taxable if the applicable five-year requirement has not been met. Exceptions apply for certain beneficiaries. [7]

For Anne and Michael, I’d compare what the family could receive after taxes while protecting the parents’ own needs first. We should also look at what happens if one spouse dies much earlier. A surviving spouse may eventually file as single while still receiving substantial retirement income, which can change the tax picture.

The parents’ lifetime is not always the full planning horizon. But leaving a larger inheritance should not require them to feel financially cornered while they are alive.

What if you’re already taking required withdrawals?

You can still convert. There is no upper age limit. However, the required distribution itself cannot be converted; satisfy the applicable IRA RMD before converting additional IRA dollars. [1]

That means a conversion adds income above the withdrawal you already had to take. There may still be a good reason to do it, particularly for a surviving spouse or heirs, but the available tax room may be smaller.

Having a traditional IRA in your 70s is not a financial emergency. Sometimes the sensible answer is a small conversion. Sometimes it is none this year.

The details worth checking before you move money

These rules are less exciting than planning Scotland. They can still change the bill.

The extra senior deduction. For tax years 2025–2028, eligible people age 65 and older can claim an additional federal deduction of up to $6,000 each. It begins shrinking above modified adjusted gross income of $75,000 for individual filers or $150,000 for joint filers. Conversion income can reduce it, raising the tax cost beyond what your bracket alone suggests. [11]

Money you already paid tax on. If you made nondeductible IRA contributions, some of the conversion may be tax-free. You generally cannot pick out just those dollars, though. The calculation combines your traditional, SEP, and SIMPLE IRAs to work out the taxable share. Form 8606 tracks the previously taxed amount. [10]

The five-year rules. If this is your first-ever Roth IRA, being over 59½ does not immediately make its earnings tax-free. The qualification clock generally starts January 1 of the first tax year for which you funded any Roth IRA for yourself, including through a conversion. Opening another Roth IRA does not restart it. Qualified withdrawals generally require that five-tax-year period plus a qualifying event such as reaching 59½. A separate clock for each conversion can affect early withdrawals before that age. [9]

Where the tax payment comes from. Paying from savings leaves more in the Roth, but reduces money available elsewhere. Withholding from the IRA leaves less to convert and, before age 59½, the withheld money may also face an early-withdrawal penalty unless an exception applies. [1]

Charitable plans. If some IRA money is intended for charity, converting it may create a tax bill you could avoid. Eligible owners age 70½ or older can consider direct IRA gifts called qualified charitable distributions, subject to limits and other rules. [8]

No easy undo. A completed Roth conversion cannot be reversed through recharacterization under current rules. Confirm the amount and tax-payment plan before proceeding. [10]

What I’d want you to understand before deciding

You should be able to explain why you are converting that amount, where the tax money is coming from, and what you expect to gain. You should also know what might make the decision less attractive.

For David and Elena, that means checking whether the conversion leaves enough cash for their normal spending, the Scotland trip, and the unexpected. For Maya and Rob, it means comparing today’s tax cost with the years after their salaries stop. For Anne and Michael, it means looking at their own security and what their children might eventually keep.

None of them needs a recommendation based solely on their age or account balance.

If you’re weighing this decision, bring your recent tax return, account statements, and a realistic spending estimate to a conversation with RYSE Financial. Include the things you actually want to do—the club membership, the family trip, the help you’d like to give your kids. You do not need to apologize for wanting to enjoy money you spent decades saving.

From our San Dimas office, we help California households work through retirement decisions and coordinate with their tax professionals. We can compare converting nothing, a smaller amount, and more, then discuss what each choice means for your spending, cash reserves, and family.

And if St Andrews is on your list, put it in the plan. “Someday” is difficult to budget for.

Sources and further reading

Rules reviewed November 11, 2026. Examples are hypothetical, do not describe actual clients, and are not forecasts or individualized recommendations.