Planning For Retirement Now is Best

With the uncertainty surrounding tax changes that could occur at the beginning of 2013, it is best to start planning now.  One trust and estate lawyer in Manhattan suggested that individuals might want to look at converting IRAs into Roth IRAs to take full advantage of the tax rates still in effect this year. 

Additionally, for people on Medicare, adjusted gross income two years prior can lead to one having higher Part B and Part D premiums. If you convert to a Roth IRA, you can avoid the required minimum distributions, bring down the income during your medicare years, and then potentially save money on Medicare premiums. It is best to wait until you’re 70 to tap into social security if you can. 

A lot of people are waiting to plan because they think that they will be working longer and see retirement as a second act.  This could be a dangerous way to think about estate planning though with how complex planning has become. 

See Mickey Meece, With Tax Changes Near, ‘You Can’t Wait to Plan’, New York Times, Mar. 7, 2012.

Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.