Fun with Retirement
Roth Conversion Instrument
Lifetime after-tax wealth delta
+$61,066
Converting $120,000 over 5 years outperforms holding pre-tax across a 27-year horizon at 5.5% assumed return.
Scenarios
Convert$5,556,465
Hold$5,495,399
Lifetime tax saved+$16,792
Conversion amount
$120,000Federal tax this year
$4,528
Marginal rate 12% · blended 27.6% on converted dollars. State adds $2,086.
Social Security taxation
65%
Of benefits are taxable at this level of provisional income.
IRMAA bracket proximity
$137.1K left
Room before the next cliff at $212,000. Current surcharge $0/yr.
First projected RMD
$55,823
Down from $61,156 under the hold scenario — 9% lower required draw.
Year-by-year projection
Conversion scenario| Year | Age | Converted | Pre-tax bal. | Roth bal. | RMD | Tax |
|---|---|---|---|---|---|---|
| 2025 | 68 | $24,000 | $1,282,880 | $354,480 | — | $6,614 |
| 2026 | 69 | $24,000 | $1,328,118 | $399,296 | — | $6,614 |
| 2027 | 70 | $24,000 | $1,375,845 | $446,578 | — | $6,614 |
| 2028 | 71 | $24,000 | $1,426,196 | $496,459 | — | $6,614 |
| 2029 | 72 | $24,000 | $1,479,317 | $549,085 | — | $6,614 |
| 2030 | 73 | — | $1,501,786 | $579,284 | $55,823 | $13,402 |
| 2031 | 74 | — | $1,522,252 | $611,145 | $58,894 | $13,924 |
| 2032 | 75 | — | $1,540,692 | $644,758 | $61,880 | $14,432 |
| 2033 | 76 | — | $1,556,846 | $680,220 | $65,008 | $14,964 |
| 2034 | 77 | — | $1,570,749 | $717,632 | $67,985 | $15,470 |
| 2035 | 78 | — | $1,581,816 | $757,102 | $71,398 | $16,077 |
| 2036 | 79 | — | $1,589,725 | $798,742 | $74,968 | $17,041 |
Illustrative projection only. Assumes 5.5% nominal return, no new contributions, conversion taxes paid from the taxable account, and 2025 federal parameters held flat. Not tax or financial advice.