Contributions to a 401k or IRA with John Kletchka | The Dale Buckner Podcast Ep. 267

Dale continues his conversation with John Kletchka, CPA at Condor, Kletchka & Associates, by emphasizing that while Roth accounts can be powerful tools, timing and strategy matter just as much as the decision itself. For employees still in their peak earning years or retirees with large required minimum distributions (RMDs) not yet started, converting too much too soon can trigger unnecessary taxes. Converting during years when income temporarily drops—such as early retirement before Social Security or RMDs begin—can often be far more tax-efficient. John also notes that uncertainty is one reason many companies now offer a Roth 401(k) option. With a Roth 401(k), employees can make after-tax contributions while working, gradually building tax-free retirement assets without the complexity of conversion timing or surprise tax bills. For those still working, contributing to a Roth 401(k) can reduce the need for large future Roth conversions. For retirees, carefully planned, partial Roth conversions over multiple years—rather than all at once—can help manage tax brackets, Medicare premiums, and Social Security taxation.  The key takeaway from Dale and John’s discussion is that Roth strategies are not one-size-fits-all. Whether choosing a Roth IRA, a Roth 401(k), or waiting to convert, the goal is to coordinate contributions and conversions with your overall tax picture—a process best handled with thoughtful planning and professional guidance.