Viewing a single comment thread. View all comments

BastidChimp t1_jdsphlx wrote

Have him open up and max out a Roth IRA asap. There are no RMDs in a Roth IRA. Invest in covered call ETFs like XYLD and REITs like O for its monthly dividends and reinvest them while he can still work. Later he can roll over his 401 K into his trad IRA. Then he can slowly convert his trad IRA into the Roth IRA.

−1

ToothPicker2 OP t1_jdsxktd wrote

So $7.5k/year in Roth IRA until retirement?

And max out the Traditional IRA simultaneously too?

Invest in the covered call ETFs just in the Roth? Currently, he’s only invested in a 2-fund portfolio of VT & BNDW (Boglehead philosophy) since our investment knowledge is zilch.

1

wanttostayhidden t1_jdt1fzo wrote

>So $7.5k/year in Roth IRA until retirement?

>And max out the Traditional IRA simultaneously too?

No, for those over 50 the limit for IRAs is $7500 total across all your IRAs. Doesn't matter if that is 1 IRA or multiple, traditional or Roth.

1

ToothPicker2 OP t1_jdt1o7b wrote

Oh that’s right.. so I’m wondering if he’s making a mistake by holding a traditional IRA instead of Roth IRA

1