Alright homies, now that I’ve stressed the importance of diversifying your taxes, a natural follow-up article would be something like “Should I convert my 401(k) to a Roth?” It would also make sense to ask this question because of the recent changes regarding who can convert to a Roth.
As part of the American Taxpayer Relief Act of 2012 (Fiscal Cliff deal), ANY employee can convert their Traditional 401(k) to a Roth 401(k) – assuming the employer has the option. This opportunity used to only be available to some savers, not everyone.
The Greatest Thing Since Sliced Bread
To some, converting from Traditional to Roth isn’t even a debate – it’s a no-brainer. But, believe it or not, it may not be great for you. Instead of writing an article telling you why You Should Convert to a Roth or why You Shouldn’t Convert to a Roth, I want to present both sides of the equation so that you can come to a conclusion for yourself.
Articles on Why You Should or Shouldn’t Convert to a Roth
The Roth IRA Movement @ Good Financial Cents
7 Things You Must Know About the Roth IRA in 2013 @ Good Financial Cents
Be a Sloth and Don’t Roth – Why Converting to a Roth is a Mistake @ Financial Samurai
Disadvantages of the Roth IRA @ Financial Samurai
Good and Bad Reasons to Contribute to a Roth IRA @ Oblivious Investor
Some Advice on Tax Planning @ Greg Mankiw (Economics Professor @ Harvard)
To Roth or Not to Roth? @ Vanguard
Keep in mind that converting your 401(k) to a Roth 401(k) is slightly different from converting to a Roth IRA, but the general concept is the same.
This should keep you busy for a while…