Roth Conversion Ladder

Retirement

A Roth Conversion Ladder is a strategy used primarily by early retirees to access retirement money before age 59½ without penalty. Steps: in retirement, convert a portion of Traditional IRA to Roth IRA each year (paying the tax). Wait 5 years, then withdraw the converted amount tax-and-penalty-free (subject to its own 5-year clock). Continue annually, building a 'ladder' of withdrawable amounts spaced 5 years apart. Combined with a bridge fund of 5 years of expenses (taxable brokerage), the ladder unlocks tax-advantaged accounts for early retirement. Coordinate conversion amounts to stay in lower tax brackets.