Why are so many financial books, columnists, newletters so biased in favor of Roths?

[progree]

2. Some additional stuff (including cautionary stuff)

Last edited Mon Dec 28, 2020, 07:28 PM - Edit history (3)

To be clear, I like Roth conversions, I've been doing them almost every year since 1998 or 1999. But they aren't always the better choice than Traditional IRAs. And when you assume the same tax rate throughout, the Roth should come out somewhat better, but never way way better like a factor of 2 or something after 30 years.

My reason for dissecting Bob Carlson's spreadsheet was that he would often say in his newsletter that it takes several years before the Roth comes out better than the do-nothing option (sticking to the TIRA) at an 8% rate of return. That surprised me, so I wanted to see if I was missing something. I find if its better after many years, than its at least a little better just about right away. Anyway, after looking at his spreadsheet, I put zero regard on any conclusions he's reached.

Edited to add: Beware of the 5 year rule on Roth conversions and contributions

https://www.investopedia.com/ask/answers/05/waitingperiodroth.asp

In my words: if you withdraw from a Roth IRA within 5 years of creating it, or within 5 years of doing a Roth conversion to it, you may end up paying a 10% penalty plus taxes on the earnings (but not the original contribution or conversion amount). There's also something about withdrawing earnings before age 59 1/2 to read up on (I don't worry about it in my situation).

Edited to add: I do like Bob Carlson's Retirement Watch newsletter a lot, and I've been reading it for years. So it was a shock and disappointment to find such key errors in the spreadsheet, something that has been many years in development, albeit recently revised to comport with the SECURE Act (changing the first RMD age from 70.5 to 72, and ending the Stretch IRA -- in most cases inheritors have to liquidate their IRA account by the end of the 10th year). And realizing that not everyone is a skilled spreadsheet developer. As I mentioned it is a huge thing with many sheets, 3 major scenarios, and about a dozen or more user-changeable variables, so I have to give him credit for effort.