rollover or start new roth

[Guest crjax]

At age 39 and 43 respectively, my husband and I each have traditional iras and rollover iras from previous 401k plans. We have our own business and also contribute to a SIMPLE ira plan through our corporation. My question is whether we should rollover our exisiting iras into a roth or start yet another account for each of us. Does age matter at all in determining whether to go roth or traditional?? Thanks in advance for any comments.

[John G]

I am not sure I fully understand your question. You can start a Roth now related to earned income and this account is not related to the prior activities. Each of you can combine all regular IRAs into one large IRA to reduce the number of accounts, ideally you would want to use a direct transfer from one custodian to another if you go this route.

You can not rollover a regular IRA into a Roth. However, you can convert and existing IRA into a Roth, an action that triggers taxes on the converted amount and you must meet various income/tax filing status rules to be eligible. Deciding if a Roth conversion makes sense requires some thinking about current/future tax rates, income, regulations, future elibibility and a range of other factors. You might want to discuss this with your accountant.

[papogi]

Several of the big mutual fund families have websites which include Roth IRA conversion calculators (I think T Rowe Price, for one, has this feature). They may help you decide whether it is better for you to convert your traditional IRA's into Roth IRA's or leave them as they are. At least it will get you in the ballpark.

[Guest erlin]

I suggest that you read the following article before jumping into Roth conversion calculations: http://www.forbes.com/1998/11/17/feat.html