Purchase an FIA and Income Rider with Traditional IRA Funds ?

[LostDollar]

I have some Traditional IRA funds that would meet minimum FIA-Income Rider Purchase requirements from some A rated carriers.

I do not have money to pay taxes on converting these accounts to Roth accounts.

I was considering using the Traditional IRA funds to purchase an income rider product, but I think I am starting to see some significant downsides to doing that.

Would anyone care to make any comments about that type of purchase?

 

[Watts]

Have you considered using a MYGA instead of a FIA? With interest rates where they are, you could rollover to a MYGA and transfer to a FIA income rider later for a higher payout… no fees for a MYGA so your principal remains whole longer.

 

[SUNus]

Using Traditional IRA funds for an income rider product might seem appealing, but it's essential to weigh the pros and cons. Income riders can provide steady income, but they often come with fees and limitations. Moreover, they might not offer the flexibility and potential growth of a mega backdoor Roth IRA. This strategy involves leveraging after-tax contributions to a Traditional IRA, potentially allowing tax-free withdrawals in retirement.