Convert $20k/yr ages 45-72
Convert $20k/yr ages 45-72 ends $692,261 ahead of current plan (no changes), after tax.
- Lifetime tax, in today's dollars: $69,273 less.
- All of it under the assumptions listed below, which the reader can change.
What the tax change is made of
- Federal income tax: −$66,255
- Tax on dividends, interest and portfolio gains: −$3,018
These add back to the total change; they are the same taxes the projection sums into the headline, discounted the same way.
Not financial or tax advice.
Lifetime tax (present value)$478,077
Terminal after-tax wealth$7,737,823
Years in IRMAA0
What this assumes
Every figure below depends on these. Change one and the answer changes.
- Horizon
- 52 yearsHow many years the projection runs.
- Nominal return
- 5%Assumed annual growth before inflation.
- Inflation
- 2.5%Grows spending, and indexes brackets between published years.
- Discount rate
- 3%Used to present-value lifetime tax — the headline metric.
- Future tax law
- Current law continuesLeft on current law, the projection assumes today’s brackets last the whole horizon — itself a forecast, not a neutral choice.
Other assumptions (4)
- Dividend yield
- 1.2%
- Interest yield
- 0.8%
- Business cash return
- 2%
- Income growth
- 0%
Year by year
| Year | Age | Ordinary income | Conversion | RMD | Federal tax | Net worth |
|---|---|---|---|---|---|---|
| 0 | 38 | $250,000 | $0 | $0 | $51,304 | $1,863,733 |
| 1 | 39 | $250,000 | $0 | $0 | $50,587 | $2,086,212 |
| 2 | 40 | $250,000 | $0 | $0 | $49,851 | $2,317,814 |
| 3 | 41 | $250,000 | $0 | $0 | $49,098 | $2,558,934 |
| 4 | 42 | $250,000 | $0 | $0 | $48,325 | $2,809,983 |
| 5 | 43 | $250,000 | $0 | $0 | $47,533 | $3,071,393 |
| 6 | 44 | $250,000 | $0 | $0 | $46,935 | $3,343,613 |
| 7 | 45 | $0 | $20,000 | $0 | $86 | $3,421,830 |
| 8 | 46 | $0 | $20,000 | $0 | $38 | $3,501,831 |
| 9 | 47 | $0 | $20,000 | $0 | $0 | $3,583,632 |
| 10 | 48 | $0 | $20,000 | $0 | $0 | $3,667,230 |
| 11 | 49 | $0 | $20,000 | $0 | $0 | $3,752,660 |
| 12 | 50 | $0 | $20,000 | $0 | $0 | $3,839,956 |
| 13 | 51 | $0 | $20,000 | $0 | $0 | $3,929,153 |
| 14 | 52 | $0 | $20,000 | $0 | $0 | $4,020,287 |
| 15 | 53 | $0 | $20,000 | $0 | $0 | $4,113,394 |
| 16 | 54 | $0 | $20,000 | $0 | $0 | $4,208,511 |
| 17 | 55 | $0 | $20,000 | $0 | $0 | $4,305,675 |
| 18 | 56 | $0 | $20,000 | $0 | $0 | $4,404,922 |
| 19 | 57 | $0 | $20,000 | $0 | $0 | $4,506,291 |
| 20 | 58 | $0 | $20,000 | $0 | $0 | $4,609,820 |
| 21 | 59 | $0 | $20,000 | $0 | $0 | $4,715,546 |
| 22 | 60 | $0 | $20,000 | $0 | $0 | $4,823,509 |
| 23 | 61 | $0 | $20,000 | $0 | $0 | $4,933,748 |
| 24 | 62 | $0 | $20,000 | $0 | $0 | $5,046,302 |
| 25 | 63 | $0 | $20,000 | $0 | $0 | $5,161,210 |
| 26 | 64 | $0 | $20,000 | $0 | $0 | $5,278,512 |
| 27 | 65 | $0 | $20,000 | $0 | $0 | $5,398,248 |
| 28 | 66 | $0 | $20,000 | $0 | $0 | $5,520,460 |
| 29 | 67 | $0 | $20,000 | $0 | $0 | $5,645,186 |
| 30 | 68 | $0 | $20,000 | $0 | $0 | $5,772,468 |
| 31 | 69 | $0 | $20,000 | $0 | $0 | $5,902,347 |
| 32 | 70 | $0 | $20,000 | $0 | $0 | $6,034,863 |
| 33 | 71 | $0 | $20,000 | $0 | $0 | $6,170,057 |
| 34 | 72 | $0 | $20,000 | $0 | $0 | $6,307,971 |
| 35 | 73 | $0 | $0 | $141,055 | $11,753 | $6,433,772 |
| 36 | 74 | $0 | $0 | $148,108 | $12,470 | $6,560,429 |
| 37 | 75 | $0 | $0 | $154,881 | $13,150 | $6,687,951 |
| 38 | 76 | $0 | $0 | $161,939 | $13,861 | $6,816,215 |
| 39 | 77 | $0 | $0 | $168,551 | $14,515 | $6,945,298 |