Financial advisors often point to Roth IRAs as a way to receive tax-free income in retirement, but AARP says Americans should think carefully before moving a long-held traditional 401(k) into a Roth IRA. The shift can secure that future tax advantage, but it may also trigger a sizable tax bill right away.
“That doesn’t necessarily mean you should abandon a Roth conversion,” Sandra Block of AARP wrote. “Just be sure you understand the pitfalls and can navigate around them.”
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