09/21/2026
Here is a situation I advised on in August of 2026. I see this often with advisors who are planning Roth conversions for a client who just retired.
Picture a 64-year-old retired executive. $8.2 million in pre-tax retirement accounts, $1.4 million in a taxable brokerage account, and a $3.6 million home with no mortgage on it. She needs about $280,000 a year to live on.
The problems the advisor lists for me:
1) The years between retiring and the start of Social Security and RMDs are the window for conversions.
2) If living expenses come out of the IRAs, those withdrawals are income and use up the room the advisor wanted for conversions.
3) If they come from selling in the brokerage account, the gains are taxable.
One way to structure it is a tax-free line of credit on the home, with the $280,000 a year drawn from the line during those years. The draws are borrowed money, the portfolio is left alone, and there is no monthly mortgage payment. She still pays property taxes, insurance and upkeep. How the draws and the conversions are treated on her return is a question for her CPA, so talk with your CPA or advisor before doing anything like this.
Hypothetical composite illustration based on common client scenarios.
Matthew Bell | NMLS # 665258 | CMG Home Loans, NMLS # 1820 | Branch NMLS # 2428237 | Equal Housing Lender
