Everything is handled by Fidelity all my accounts are there... the 401(k) TIRA and Roth IRA so they could do a split between earnings and contributions if that makes sense, perhaps I will let the money sit in the account and do rollovers every 3 or 6 months and just split the earnings and contributions between both IRA's.
You may want to read through the extended discussion in the main post on this topic for the pros and cons of letting the money sit in the account and doing split rollovers vs. getting it into the Roth immediately (the link is below; look at all the most recent back-and-forth near the end). If you are going to continue to lead a Fancypants lifestyle post-retirement, you're probably better off getting the funds into the Roth as fast as you can.
http://forum.mrmoneymustache.com/investor-alley/did-the-irs-just-give-an-extra-$35kyr-of-tax-free-growth-saving-space/50/
@brooklynguy thanks for the link... I read every post in the thread this weekend :)
Lots of good info.
@seattlecyclone thanks for the IRS Publication info, always good to be able to the source of the information.
So here are a few questions for you guys and anyone else reading...
I have just over half a million in TIRA/401k's now (wife and I combined), I max out my annual pre-tax contributions annually plus I get and employer match of 25% of my contributions (amd 2/3rds vested, last 1/3 vests in June). My wife gets about $6k annually deposited in a 403(b) from an insurance payment, the account is fully vested so we roll it over to a TIRA annually. I am able to make an annual spousal contribution in my wife's name to her TIRA since the insurance contribution is not reported as a plan participation and she is considered a non-working spouse. So in total annually we put add about $35k to tax deferred accounts.
Based on how my company pays out bonuses sometimes it is 12/31, other years it is 1/31 of the next year depending on what is more advantageous tax wise (generally to them, although with the fiscal cliff they paid early in favor of the employees). So on years where my bonus doubles in one year and I don't get one in another year I can make a Roth Contribution.... That doesn't happen too often...
We have a combined total of about $50k in Roth IRA savings and several hundred thousand in taxable accounts.
I can contribute flat dollar amounts (up to $30k in plan year 2015, not sure to what extent I will contribute) after tax into my 401(k) invest it into a money market fund, and immediately roll them over to a Roth IRA every pay check with no limits or fees (I can do the roll over online so it doesn't even require a phone call). I will have no G/L, I will have already maxed out the pre-tax investing options available to me, I have substantial taxable accounts already.
I do not have access to traditional back door Roth funding since I have substantial TIRA assets and am in a high tax bracket.
I am 38 and I plan on retiring somewhere between 48 and 50, I am more concerned with having the ability to roll over all of my TIRA to Roth before RMD's then I am with funding any years of retirement.
To me this seems like a great opportunity to load up the Roth instead of further loading taxable accounts (I will still invest here as well over time).
Am I missing something that should make me want to invest in taxable accounts vs. the Roth mega back door? Based on my account dynamics would you suggest a different rollover strategy then immediate etc..
Thanks,
-Mister FancyPants