My Advice on IRA's

One of the major changes for the 2019/2020 version of Everyday Taxes was the addition of a "My Advice" portion at the end of most chapters. This is where I tell people what 20 plus years of experience in taxes, 25 years of experience in the military, and 50 years of life experience have taught me.

Copied below is the that section from the IRA chapter.
The main reason I wanted to include it here is the Roth versus Traditional debate. Math often says one thing, but life doesn't always play well with the math...

My Advice:

1. Tax people and investment advisors will argue endlessly over the Roth versus Traditional debate. There is a lot of math that can help you figure out which one is best from a tax perspective, but I want to add my 2 cents. After 20 years, and thousands of clients, I have literally ZERO clients who regret investing in Roth IRA’s and MANY who wish (or should wish) that they had picked Roth over Traditional. There are a ton of things going on in retirement that make the amount of taxes paid lifetime insignificant compared to real life in retirement. Here’s my point: Talk to your financial advisor and tax person about YOUR situation, go over the numbers, your financial desires and the implications and make the best decision for you, BUT, if you are still unsure, or it’s a close call, go Roth.

2. Open a Roth IRA and put some money into it as early in life as you can. Parents should open a Roth IRA for their children as soon as they get their first job and encourage them to invest in it. Money saved in a Roth before age 18 is MAGICAL due to the long time horizon for it to grow.

3. If you make too much money to invest in a Roth IRA, you can make non-deductible contributions to a traditional IRA and then convert them to a Roth with no tax implications. This is called a “back-door Roth”. Your financial advisor can assist you in doing this.

4. Start taking required minimum distributions out of traditional IRA accounts in the year you turn 70 and a half vice waiting. Making two withdrawals in a single year can really mess your taxes up.

5. Totally personal advice: You invested in these accounts so you could enjoy your retirement. SPEND THE MONEY! Obviously make sure you don’t run out, but enjoy life – don’t leave it to your kids!