Not a fan of the second article, seems to use fear tactics and fuzzy math to say, "You need an accountant!" Here's my rebuttal:
First off, paying a lot of taxes on your RMD isn't really a problem that should be "shocking" or result in "catastrophic tax issues". You're filthy fucking rich at this point, so paying more in taxes than was optimal in hindsight might be a minor annoyance, but not a problem in the real sense of the word.
To get into the meat and potatoes, you really need to compare financial decisions over the length of time that the decisions diverge. The most glaring example in this article is in the last paragraph of Solution 1, where he states, "The tax deduction today in[sic] minor compared to the future taxes avoided due to the tax-free nature of Roth growth!" But he neglects to tell you that your tax-deduction (if you chose Traditional) would also grow at the same rate, and in fact Roth and Traditional have equivalent final values if the tax brackets at which the contributions/withdrawals are taxed are the same. (To use numbers for this example, let's say you are in the 20% bracket when contributing and will be in the 20% bracket when withdrawing (and let's assume this investment will octuple over the timeframe). Let's say you have $5000 to invest. You could choose Roth, pay $1k in taxes, and then have $32k to pull tax-free in the future, or you could choose Traditional, octuple to $40k, then pay $8k in taxes. Yes, in the latter case you paid 8x as many taxes, but you still ended up with $32k.)
Actually, he makes this same mistake again in Solution 2 (where he recommends investing in taxable), when he says, "This means that dropping money into a 401(k) at work needs matching to offset the future losses from higher taxes and RMD issues." This is hogwash. With a taxable account, you will be paying your current marginal rate now, a dividend drag over the life of the investment, and then long-term capital gains when you pull out. This is extremely unlikely to beat Traditional, and is almost guaranteed not to beat Roth.
As for Solution 3, well sure, if you reach 59 1/2 and are not working, most people with any math sense will consider pulling out some money to minimize overall tax rates. Go Curry Cracker does a really good job discussing tax optimization strategies.
Solution 4 is the FIRE standard: either use 72(t) or Roth ladder to access your retirement accounts before 59 1/2.
Solution 5 must be a joke, because he is recommending his clients donate all of their RMD money rather than pay taxes on some portion of their money. Nothing wrong with donating to charity, but it sure as hell isn't increasing the amount of money going to his clients.
Bottom line, there is a point where tax optimization strategy would have you choose Roth instead of Traditional, but at this point you'd probably be 1) filthy rich (at least in your 401k/IRA), and 2) making relatively lower income (say, in a post-"retirement" job). This doesn't apply to many people, and could be used in the dictionary as an example of "first-world problems".
"These ideas I shared with you today are only a start. They are the framework to build your financial plan. But the details require the master’s touch." With a foundation this shoddy, no thank you.
