Technology, Roth Conversions and a Squirming Son

By Andy Ives, CFP®, AIF®
IRA Analyst
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77 and sharp – that’s my dad. A voracious reader. Daily crossword puzzles. Curious. Engaged with the community. But he gets a little loose with technology. Comedic evidence suggests he is blissfully unaware if he is having a personal text conversation with me, or if the communication is part of a larger group text with his extended family.

He is also too trusting, which is a sad commentary on society in general. This can be perilous when combined with tech. For example, not long ago his computer was infected with malware (“malicious software”). The glowing blue screen offered a phone number and a quick fix. He dialed. When a voice on the other side said the problem could be corrected, my dad willfully shared his credit card information. (I cringed and squirmed like an octopus in my chair as he relayed this story. Fortunately, he cancelled the card in time – no harm done.)

In another example, just recently we discussed the benefits of IRA-to-Roth conversions. With a depressed market, now is a good time to consider such a move. He has never had a Roth before (unfortunately), so we walked through the 5-year clock rules, the benefits of no RMDs on a Roth IRA, tax-free earnings, and the very real possibility that taxes will go up in the future. We talked about “stealth taxes” and how Roth conversions can impact other income-based items like financial aid and IRMAA surcharges for Medicare Parts B & D. We touched on his current income, the “bracket bumping” Roth conversion strategy, and other personal financial numbers.

He scratched out copious notes in order to have an intelligent discussion with his trusted financial advisor. He included his 2019 income and from where those dollars originated, i.e., pensions, RMDs, capital gains, etc. I offered to review his work, so he promised to type up the information and send it to me for edit. At 9:30 that evening, I received a text: “Andy, I sent you an email with a draft of my Roth conversion notes. I sent it to XXXXXX. Is that right?”

My personal email address has remained unchanged for 15 years. “XXXXXX” was an email I did not recognize. It included the letters “A-n-d-y,” but was otherwise completely foreign. Where in the world had he sent his personal financial data? I was squirming again, but now I was angry. Confusion over group texts can be laughed off, but this was a potentially serious breach.

We dodged another bullet. The obscure email belonged to an old family friend, and my dad called her to clear up the confusion. We all took a deep breath.

The larger point being – this is not Pleasantville, 1950. You may live in Small Town, USA, but slithering internet tentacles reach into all of our homes. Scammers and bad actors lurk. I consistently hear from frustrated advisors about newly acquired accounts that have been churned and intentionally mismanaged. Elder abuse is pervasive. We must all be diligent with our personal information, and extra vigilant when those who are less tech savvy share financial data via electronic communication.

My dad has been reprimanded and he is apologetic…though I’m sure he will accidentally text my brother this evening when he intends to text me.

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