How a Creative Planning Roth Conversion Strategy Protects Retirement Paychecks

Do I still need Roth conversions at 70 if I'm already on Social Security?

A Roth conversion strategy at age 70 still makes practical sense if you have gap years before required minimum distributions begin, expect higher tax rates later, or want untaxed money available for spending increases. Even with Social Security active, moving modest amounts into a Roth can prevent larger taxable distributions once mandatory withdrawals start at age 73.

To decide if this fits your household, run three checks on your numbers. Check one looks at your calendar: are there gap years left before your first required distribution? Jerome (hypothetical), 70, is a divorced retired insurance claims adjuster who has already claimed Social Security. With about $550,000 in a traditional IRA, his first mandatory distribution arrives at age 73, giving him three clear conversion years at ages 70, 71, and 72. Once age 73 arrives, each annual required withdrawal must leave the account first and cannot be converted.

Check two compares your current tax bracket against your expected future bracket. Convert only when the tax rate you pay on a dollar today is lower than the rate you expect on that same dollar later. If the two rates are about equal, a conversion roughly breaks even and is worth doing only for another stated reason, such as heirs, Medicare premiums or Roth money for guardrail raises. Jerome expects to land in a higher bracket once required distributions stack on top of his Social Security.

Check three asks whether your annual spending changes with market performance. Under the firm's flexible spending framework, Creative Planning uses a withdrawal plan with guardrails that raises or trims spending as markets move. Jerome likes to pay for his two grandchildren's swim lessons and summer camp, and he wants to increase his spending after strong market years without creating an unexpected income tax bill. If any of these three checks fail, converting little or nothing may be the most sensible path.

Three conversion years, one page: what a Creative Planning written plan shows

A finished review puts your numbers onto paper so every dollar has a defined destination. The Creative Planning written plan lists the exact dollar target for each year, the estimated tax liability, and which specific account will pay the IRS. For Jerome, the written plan schedules a conversion of $20,000 per year across ages 70, 71, and 72, generating an estimated federal tax bill of $2,400 each year at an assumed 12% rate, paid entirely from his cash reserve rather than IRA assets.

The written plan also tracks projected modified adjusted gross income against federal benefit thresholds. For 2026, the standard Medicare Part B monthly premium is $202.90, set by income from two years prior. Creative Planning checks the single threshold of $109,000 (or $218,000 for married couples filing jointly) before recommending any annual dollar amount. This review keeps conversions from accidentally triggering the next Medicare income-related monthly adjustment bracket.

The written plan sets a hard calendar cutoff. A Roth conversion has to be completed by December 31 to count for that tax year, and the IRS allows no grace period into April. Custodians get backed up in late December, so Creative Planning sends Jerome's conversion paperwork in the first week of December, which leaves time to fix a rejected form before the year closes.

Each converted dollar gets a job in your monthly income plan. The written plan records your withholding elections and names the new Roth as the first source for guardrail spending raises. When Jerome wants an extra trip or a second week of summer camp for the grandkids after a strong market year, that money comes from the Roth, not the taxable traditional IRA.

Will converting raise my Medicare premium or change what my kids inherit?

Moving pre-tax balances into a Roth directly affects your Social Security taxation, future Medicare Part B and Part D premiums, and the tax treatment of accounts inherited by your children. Because every converted dollar adds to your adjusted gross income for that calendar year, these three pieces must be evaluated together rather than as isolated decisions.

Up to 85% of your Social Security benefit can become subject to federal income tax when your combined income passes statutory limits. Adding a $20,000 conversion to Jerome's tax return pulls more of his retirement benefit into taxable territory for that year. Creative Planning calculates the combined tax hit of the conversion and the extra taxable Social Security before moving forward.

Medicare rules require equal care because premiums rely on tax returns filed two years earlier. Converting at age 70 affects premiums at age 72. Moving $100,000 in one calendar year because an article said to convert before required distributions start pushes an income of $55,000 up to $155,000. Under 2026 CMS rates, that moves a single filer past the $137,000 tier, jumping the monthly Part B premium from $202.90 to $405.80, which costs an extra $2,434.80 over twelve months.

For your heirs, non-spouse beneficiaries must empty an inherited traditional IRA within 10 years, paying income tax at their own marginal rates during their peak earning years. An inherited Roth IRA follows that same 10-year rule, but distributions are generally tax-free. Creative Planning verifies that beneficiary designations on the new Roth account are documented and confirmed the day the account is opened.

• Taxable Social Security and conversion amounts are calculated together during a fall tax review.
• Annual conversions are kept below the single $109,000 modified adjusted gross income tier to prevent Medicare premium surcharges.
• Primary and contingent beneficiary forms are recorded immediately to ensure heirs receive tax-free withdrawals under the 10-year distribution rule.

After age 73, each RMD must come out before any conversion

Waiting until required minimum distributions begin reduces your planning flexibility because mandatory withdrawals cannot be converted to a Roth and must be taken as taxable income first. For Jerome, his first required withdrawal on a $550,000 balance at age 73 equals approximately $20,750 based on the IRS distribution factor of 26.5. That distribution uses up his lower tax brackets automatically.

Each skipped gap year has a price. At Jerome's assumed 12% rate, a $20,000 conversion costs $2,400 in tax. Wait until his rate reaches an assumed 22%, and the same $20,000 costs $4,400, so every year he passes up adds $2,000 in tax. In the break-even table, the running benefit reaches $7,920 at age 78, passing his $7,200 total conversion tax.

No investment portfolio is guaranteed, and account values can fall, sometimes for years at a time, while the tax owed on a Roth conversion remains due regardless of market direction. However, holding untaxed dollars gives retirees room to trim or raise distributions under our flexible spending approach without triggering tax bracket spikes during volatile periods.

Can I run the first numbers myself before calling Creative Planning?

You can evaluate the initial numbers on your own by pulling line 15 of your most recent IRS Form 1040 to identify your current taxable income and see how much room remains before the next federal tax bracket. You can then calculate your projected modified adjusted gross income to confirm whether your total stays comfortably under the single $109,000 or joint $218,000 Medicare baseline.

Find your date of birth to confirm the age your required minimum distributions begin, and review the beneficiary designations on every custodial account. Anyone with a birth year of 1959 or earlier starts required distributions at age 73. Anyone born in 1960 or later starts at age 75. Subtract your current age from that starting age, and you have the number of conversion years left.

Conversions rarely help someone who expects the same or a lower tax rate later, has no cash to pay the tax without drawing more from the IRA, or plans to leave the IRA to charity, which pays no income tax on it. Professional advice becomes valuable when conversions interact with taxable Social Security benefits, cross into Medicare surcharge territory, or require coordinating quarterly estimated tax vouchers.

Creative Planning works with households holding at least $500,000 in investable assets and meets with clients in all 50 states by scheduled video and phone calls. Advisory fees are written into the client agreement and signed before any work begins.