Table 6. Keeping Assets in a Deductible IRA vs. Converting: Current Retirees(A 65-Year-Old Investor Converting $500,000)

Table 6. Keeping Assets in a Deductible IRA vs. Converting: Current Retirees (A 65-Year-Old Investor Converting $500,000)
Marginal Tax Rate in Retirement (%)	Total Aftertax Withdrawals in Retirement				Conversion Advantage (Disadvantage)		When Converting is Worthwhile
Marginal Tax Rate in Retirement (%)	Roth IRA ($)	Deductible IRA ($)	Taxable Side Acct ($)	Total Value of Deductible IRA Plus Taxable Side Account ($)	($)	(%)	When Converting is Worthwhile
19.75%	$1,028,051	$830,151	$320,610	$1,150,760	($122,710)	-10.7%	Never
28.75	1,028,051	732,486	318,637	1,051,123	(23,072)	-2.2	For amounts less than $241,683
31.60	1,028,051	703,187	318,047	1,021,234	6,817	0.7	Always
38.25	1,028,051	634,821	316,670	951,491	76,560	8.0	Always
The assumptions for this table are the same as for Table 5, except in this case the amount converted from the deductible IRA is $500,000, pushing the investor into the 38.25% tax bracket. The tax due on the converted amount is $178,203, which is the amount that would be invested in the tax savings account if the conversion is not done. Source: T. Rowe Price Associates, Inc.