{"version":"1.0","type":"rich","provider_name":"Acast","provider_url":"https://acast.com","height":250,"width":700,"html":"<iframe src=\"https://embed.acast.com/$/69c148bb1a160b44db9c8fcc/6ad6ae44c23d57531214e077?\" frameBorder=\"0\" width=\"700\" height=\"250\"></iframe>","title":"How to use a Roth conversion ladder for tax-free income","description":"<p><strong>1060. </strong>Dreaming of retiring early or taking an extended career break, but worried your money is locked away until age 59.5? Host Laura Adams explains a powerful strategy to retire early and avoid expensive penalties.</p><p><br></p><p><strong>Key Takeaways</strong></p><ul><li>A Roth conversion ladder allows early retirees to move tax-deferred funds into a Roth IRA and access the converted amount tax- and penalty-free before 59.5.</li><li>Each Roth conversion requires a separate five-year waiting period before you can withdraw it penalty-free.</li><li>Building a Roth conversion &quot;ladder&quot; means executing annual conversions so that starting in year six, you unlock a new amount of penalty-free funds to spend.</li><li>Doing Roth conversions in low-income years, such as at the start of early retirement, allows you to pay less income tax.</li><li>Have a plan to pay taxes on a Roth conversion from savings or a taxable brokerage account and not from your retirement account.</li><li>Be aware that having higher income due to a Roth conversion could inadvertently reduce ACA health care subsidies.</li></ul><p><strong>Discover more from Money Girl!</strong></p><p><u><a href=\"https://www.facebook.com/MoneyGirlQDT\" rel=\"noopener noreferrer\" target=\"_blank\">Facebook</a></u></p><p><u><a href=\"https://www.quickanddirtytips.com/money-girl-newsletter/\" rel=\"noopener noreferrer\" target=\"_blank\">Newsletter</a></u></p><p>Transcripts available at <u><a href=\"https://www.quickanddirtytips.com/transcripts/money-girl/\" rel=\"noopener noreferrer\" target=\"_blank\">QuickandDirtyTips.com</a></u>.</p><p>Email: Laura@LauraDAdams.com or leave a voicemail: (302) 364-0308.</p>","author_name":"QuickAndDirtyTips.com"}