Key Points
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Make sure you’re taking on an appropriate amount of risk.
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Max out contributions if you can.
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Consider converting to a Roth for more flexiblity later.
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If you’re aiming to retire in 2027, you may be excited about the idea of bringing your career to a close. But it’s important to make sure your IRA is retirement-ready. Here are some moves to make now if your career is about to wrap up.
1. Max out your 2026 contribution
You might assume that if you’re on the cusp of retirement, there’s no longer a need to contribute to your IRA. But sneaking extra funds into your account at the last minute could give you an added cushion for retirement, which is always helpful.
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Plus, IRA contributions get tax-advantaged treatment. Even if you’ve got plenty saved and your IRA doesn’t “need” a boost, it never hurts to add to it while enjoying tax savings. This year, IRA contributions max out at $7,500 for savers under 50 and $8,600 for those 50 and over.
2. Make sure your investments aren’t too risky
When retirement is far off, it’s smart to go all-in on stocks so your IRA can grow. If you’re close to retirement, it may be time to shift into a more conservative asset allocation.
Figure out what percentage of your portfolio you’re comfortable keeping in stocks, and make changes accordingly. You may also want to start favoring dividend stocks for the income they can provide rather than concentrate on growth stocks, which can be more volatile.
3. Consider a Roth conversion
Hopefully, you’re retiring with a decent chunk of money in your IRA. But that could also mean that once required minimum distributions (RMDs) start, you’re forced to take large withdrawals that drive up your taxes.
If you’re worried about RMDs, you may want to consider a Roth conversion, which lets you move funds from a traditional IRA into a Roth IRA. Once money lands in a Roth IRA, it grows tax-free, and withdrawals are tax-free as well. Plus, with a Roth IRA, there are no RMDs to worry about.
Now, you should know that Roth conversions are a taxable event. If you have a $1 million IRA, converting it in a single year is generally unwise. It could pay to work with an accountant or financial professional who can help you convert in a more tax-efficient manner.
A 2027 retirement date is something to be excited about. Even if your plan is to end your career toward the latter part of the year, it’s close enough to begin that final countdown. Just make sure your IRA is set up for success so you can make the most of the savings you worked hard to build.
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