The Roth Conversion Conversation I Have With Almost Every Client

The Conversation That Changes Everything

There’s a conversation I have with almost every client. It usually happens in our second or third meeting, after we’ve mapped out the income plan and started looking at the tax picture. I pull up the projection and say: “See this window right here? These years between your last paycheck and when RMDs kick in? This is the most valuable stretch of your financial life.”

Most people have never heard that before. And I get it — nobody talks about it. The financial industry spends all its energy on accumulation. Save more. Invest better. Beat the market. But the real game — the one that can save a family six figures in lifetime taxes — happens in a quiet little window that most people sleepwalk right through.

I’m talking about Roth conversions. And before you tune out because it sounds boring — you’re right, it is boring. That’s the point. The best strategies in retirement aren’t exciting. They’re precise.

The Window Nobody Talks About

Here’s the setup. You retire — let’s say at 62 or 63. Your paycheck stops. For the first time in decades, your taxable income drops. Maybe dramatically. You go from a $200,000 household income to... not much. Maybe some part-time work, maybe some investment income, maybe nothing at all.

Meanwhile, your 401(k) or IRA is sitting there, growing, waiting. And at 73, the IRS shows up and says: “Time to start pulling money out. And by the way, every dollar is taxable.”

That’s the Required Minimum Distribution — the RMD. And here’s the thing: by the time RMDs hit, your balance has often grown larger than when you retired. So the forced withdrawals can be substantial. Push you into higher brackets. Trigger the Social Security tax torpedo. Increase your Medicare premiums. The compounding effects are real.

But between your last paycheck and age 73? That’s the window. Your income is low. Your tax bracket is low. And you have the opportunity to move money from your tax-deferred accounts into a Roth IRA — paying tax now at a lower rate to avoid paying tax later at a higher one.

That’s a Roth conversion. And done well, it’s one of the most powerful tools in retirement planning. Done carelessly, it’s expensive.

The Texas Advantage

This is where living in Texas becomes a genuine financial edge — and I don’t say that lightly.

Texas has no state income tax. That means when you do a Roth conversion here, you’re only paying federal tax. In California, you’d pay up to 13.3% on top. In New York, up to 10.9%. In Texas? Zero.

You’re converting at a discount the rest of the country doesn’t get.

I bring this up because a lot of my clients moved to the DFW area from higher-tax states. They know Texas is tax-friendly, but they don’t always realize how that advantage compounds when you layer it into a Roth conversion strategy over 5-10 years. The savings aren’t trivial. For some households, we’re talking about six figures over a retirement — money that stays in the family instead of going to the IRS.

If you live in Texas and haven’t explored Roth conversions, you’re leaving money on the table. That’s not a sales pitch — it’s just math.

How Much Should You Convert?

This is where it gets precise. And precision is the whole game.

A Roth conversion isn’t a product you buy. It’s a decision you make — and the variables matter. How much do you convert? In which year? Into which bracket? The answers change every year depending on your income, your deductions, your capital gains, and what’s happening in the tax code.

I’ve seen people convert too much in one year and push themselves into the 32% bracket when they could have stayed at 22%. That’s not a rounding error. That’s real money — gone. I’ve also seen people convert too little, spreading it out so cautiously that they run out of window before they run out of tax-deferred money.

The right approach is somewhere in between, and it requires looking at the full picture. Every year, we run the projection: What’s your taxable income this year? Where does the bracket change? How much room do we have before we trigger the next tier? What about the Social Security tax torpedo? What about IRMAA — the Medicare premium surcharge?

Then we convert up to the line. Not over it. Not under it. Right up to it.

It’s not glamorous work. Nobody posts about their Roth conversion on Instagram. But year after year, done with precision, it quietly reshapes a family’s entire tax future.

Why This Isn’t a DIY Project

I want to be honest about something: you could technically do this yourself. The IRS doesn’t require a financial advisor to execute a Roth conversion. You can call your brokerage, move the money, and pay the tax.

But should you? That depends on whether you trust yourself to run the full tax projection every year. To account for the interaction between conversion income, Social Security taxation, capital gains, Medicare premiums, and future RMDs. To know exactly where the bracket edges are and how much room you have.

Most people I work with are smart, capable, successful. They built careers and raised families and accumulated real wealth. But this isn’t about intelligence. It’s about bandwidth. And specificity. The Roth conversion decision is one where the difference between “pretty good” and “optimized” is measured in tens of thousands of dollars over a retirement.

That’s why I think of this as a precision game. Not a set-it-and-forget-it product. Not a one-time event. An annual, intentional, carefully calibrated decision.

The Boring Strategy That Builds Wealth

I tell clients this all the time: the best retirement strategies are boring. Nobody brags about them at dinner. You won’t see them on CNBC. But done well — consistently, precisely, over a 5-10 year window — a Roth conversion strategy can save a family more money than almost any investment decision they’ll ever make.

The money in a Roth grows tax-free. It comes out tax-free. There are no RMDs. And when you pass it to your kids, they get tax-free income during the 10-year distribution window. The ripple effects last a generation.

So yes — it’s boring. Boring builds wealth. And if you’re in Texas, within a few years of retirement, sitting on a meaningful 401(k) or IRA balance? This is the conversation you need to be having. Not next year. Not “someday.” Now — while the window is open.

Christopher Swan, CFP®, MBA is the founder of Retire With Swan, helping Texas families within five years of retirement build clear, tax-smart income plans.

Ready to see what a Roth conversion strategy could look like for your family?Request a Swan Fit Call →