Roth Conversion: which assets to convert?
Hello: Is there a resource that will assist in deciding which asset(s) in my IRA I should use for Roth Conversion.
Should I sell stock and convert the cash? Should I convert assets in-kind? And if yes (to assets in-kind), do I convert those that have lost value that I think will recover or those assets that have gained in value? Does it matter?
Thank you in advance and have a great day!
Permalink Submitted by Alan - IRA critic on Fri, 2024-07-12 10:04
If you can tell, which is unlikely, you would convert the investments most likely to appreciate in the future. Publicly traded shares are priced to reflect future potential, so it probably does not matter which investments you convert. If you later change your mind you can always sell the investment in the Roth and replace it.
You would also generally favor stocks and stock funds in your Roth IRA and bonds in your TIRA because over the long haul stocks will outperform bonds and your Roth IRA will usually be held longer because it has no RMDs.