Roth accounts have a reputation for being simply tax free, but Craig explains four traps that catch people who were never told the full rules. Beyond the 59 and a half age requirement, there is a five year rule on the account itself, a separate five year clock on every conversion that carries a 10% penalty if broken (even for beneficiaries after death), and a Roth 401k or 403b whose five year clock does not transfer when rolled into a Roth IRA. Craig explains why starting these clocks early, even with a small contribution or conversion, can prevent a costly surprise later.
Comments