When to Contribute or Convert to a Roth Account

Roth decisions should weigh effective marginal tax rates — IRMAA surcharges and capital-gains stacking — not just headline tax brackets.

• Roth favors low current rates: Pfau says Roth contributions/conversions make sense when you can pay taxes now at a lower rate than you'd face later, benefiting early-career, late-career part-time, or early-retirement "gap year" savers.
• Only 12% in Roth: Per the Investment Company Institute, just 12% of IRA assets are in Roth IRAs, leaving most savers exposed to large future RMDs starting at age 73 or 75.

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