{
  "id": 3324090,
  "title": "I'm 62 With $900,000 in My 401(k). Should I Convert $90k Annually to Reduce Taxes and RMDs?",
  "url": "https://urgent.news/2026/08/24/im-62-with-900-000-in-my-401-k-should-i-convert-90k-annually-to",
  "topic": "finance",
  "section": "Finance & Markets",
  "published": "2026-08-24T09:00:00.000Z",
  "source": {
    "name": "Yahoo Finance",
    "slug": "yahoo-finance",
    "url": "https://finance.yahoo.com/news/im-62-900-000-401-142054024.html"
  },
  "original_language": "en",
  "account": "At the age of 62, with a $900,000 401(k), one may ponder upon converting $90,000 annually to a Roth IRA to reduce taxes and RMDs. Two significant concerns associated with pre-tax retirement accounts, such as 401(k)s and traditional IRAs, are their taxation upon withdrawal and Required Minimum Distributions (RMDs). Taxes are levied at ordinary income rates, not the normal lower rate for investments, and RMDs begin at age 73, compelling minimum withdrawals from each pre-tax retirement account. Roth IRAs, however, do not entail RMDs, as the post-tax funds do not have required minimum distributions. Converting a pre-tax portfolio to a Roth IRA, known as a Roth conversion, involves paying upfront conversion taxes, which can be a substantial drawback, particularly as one nears retirement. This is because conversion taxes could outweigh future tax savings, raising taxable income to a higher bracket and resulting in high effective tax rates. To mitigate this, consider a staggered conversion, where smaller amounts are converted over time, keeping tax brackets lower. In the case of converting the entire $900,000 at once, the taxable income would fall into the 37% bracket, with an overall effective tax rate of 32.02%. In contrast, converting only $90,000 would place the taxable income in the 22% bracket, with an effective rate of 13.40%. This staggered approach would result in a total of $120,610 in conversion taxes over a decade, considerably less than the $307,197 paid by converting all at once. Seeking advice from a financial advisor is recommended for personalized guidance on Roth conversions based on individual circumstances and assumptions.",
  "summary": null,
  "key_points": [],
  "editors_take": null,
  "illustration": null,
  "coverage": {
    "outlets": 1,
    "also_reported_by": []
  },
  "ai_generated": true,
  "disclaimer": "Summaries, key points and the editor’s take are written by software from other outlets’ reporting and may contain errors — always check the linked original."
}