@travis sickle Your video was very informative. I have a question though. In 2016 I started a 529 for my kid in the sum of 30k. We are now, in 2024, and the total has decreased to around 29k. So no gains in that 8 year period. Through the Secure Act, will I be able to transfer the full amount to a ROTH without incurring a penalty?
Yes, you'll need earned income in the year of the conversion which really makes it less beneficial since it also eats up your contributions to the Roth. The requirement as is 15 years so you'll have to wait a bit more. I'm curious to your performance. I'm also wondering if you're thinking that 529 had some performance issue that would be solved by a Roth IRA -- which is generally the wrong way to think of it. Become a channel member and join the discord channel too if you want to look at this more.
Great news !!
@travis sickle
Your video was very informative. I have a question though.
In 2016 I started a 529 for my kid in the sum of 30k. We are now, in 2024, and the total has decreased to around 29k. So no gains in that 8 year period. Through the Secure Act, will I be able to transfer the full amount to a ROTH without incurring a penalty?
Yes, you'll need earned income in the year of the conversion which really makes it less beneficial since it also eats up your contributions to the Roth. The requirement as is 15 years so you'll have to wait a bit more. I'm curious to your performance. I'm also wondering if you're thinking that 529 had some performance issue that would be solved by a Roth IRA -- which is generally the wrong way to think of it.
Become a channel member and join the discord channel too if you want to look at this more.
What if you maxed out your back door Roth IRA in the same year, can you still do the 529 to Roth rollover?
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When they says starting in 2024, does that mean I can use 2023 tax year money to fund the roth being that it is now 2024?
No. The contributions have to have been sitting in the 529 for at least 5 years before you transfer them.
Is it even worth opening a 529 for a kid who only has 2 years before he graduates?
Yes.
Travis did you strategically open a 529 each for you and your wife?