Hi Nathan. Absolutely nothing wrong with do-it-yourself if you're interested, committed, and have the time! If you're a Registered Investment Advisor, I suggest networking with planners who have expertise in this area: start with NAPFA and FPA. The right connections will point you to books/websites/articles, etc.
Dennis, all the more reason to take advantage of Roths now while they still exist.
Dennis, anything is possible. If they take it away do they do so going forward or fall all Roth accounts. I think more likely is there is Roth tax (no basis for my comment) and Roth growth gets taxed, but at lower rates than income taxes and hopefully lower than capital gains taxes. Meaning a future tax would still make it a good deal, just not as good as today --- but our Gov. has proven it does strange things.
Dennis, I agree with Delia. Work with the tax system we have now; impossible to predict what it will be in the future!
DMB, I'm a big believer in consumers understanding their finances. I think you ought to give it a test run by picking up your tax return and seeing if you can replicate what your accountant has done. I have had clients tell me that the point where they stopped doing their own taxes was when they opened their own business.
DMB, just remember that doing it yourself (DIY) requires that you keep up with the changes in the laws -- including last-minute government decisions -- and keep organized. After all, that's what you pay a professional to do.
We have another question from Evan:
DMB, we all make choices about what we do ourselves, and what we pay others to do for us. If you're a personal finance geek, you're a great candidate for doing your own taxes. Will you miss a deduction? Not if you're diligent and keep your knowledge up-to-date.
Evan, the conversion is taxed at your income tax rate for that taxable year, and ideally, you should pay for the conversion with funds outside of the IRA.
Hi Evan. If you convert traditional IRA dollars to a Roth, the amount converted shows up as taxable income in the year you convert. That's the basic idea: pay taxes now, to avoid them later. If you're young, in a lower tax bracket than you're likely to be in the future, and have the cash to pay the tax bill, it could make sense. Lots of factors to consider; these are the basics.
Looks like we have time for one last question. A follow up from Emily:
Emily, maybe someone can give a better answer. It's not going to help, but I can't tell you the specifics. I do know of cash where the husband's credit was bad and the wife qualified for the mortgage with her income. So wife and husband owned the property but the wife only was on the mortgage. it may work to get a good rate an get the house, but you now longer have shared legal credit responsibility ---
Emily, the husband's not-so-good-credit could hurt the wife's credit on joint accounts. And if you apply for a mortgage together it could also hurt you, but the lender would have to tell you that. That's why before you apply for credit I recommend that you first both obtain your credit reports for free from www.annualcreditreport.com, where you can also check your credit scores with the credit bureau. I also like www.myfico.com for educational info and to check your FICO credit score.
Emily, take a look here: www.experian.com/credit-advice/topic-credit-and-marriage.html
Emily, Jamie makes a good point. I've also seen it happen where they have to issue the mortgage in one spouse's name and not the other's.
And that's all the time we have for today, folks. A big thank you to all of our NAPFA experts for fielding questions today!
Thank you to everyone who asked questions, as well. Be sure to join us for next month's Jump-Start Your Financial Plan chat on November 21 from 1-3 p.m. ET. See you then!