A Roth conversion ladder turns a traditional IRA into tax-free Roth money one yearly rung at a time. You convert a slice each year, pay the tax on that slice, and after five years each converted rung becomes available penalty-free.

The planner above maps the whole ladder. Enter your traditional balance, annual conversion amount, expected return, and ladder length, and it shows each year’s start balance, conversion, and end balance, plus the totals.

This guide explains how the ladder math works, what the schedule tells you, and the tax realities the numbers do not show.

What Does the Roth Conversion Ladder Planner Do?

You enter four values: your current traditional IRA balance, the amount you plan to convert each year, the expected annual investment return as a percentage, and the ladder length in years from 1 to 20.

The headline reports the total converted over the ladder. Beneath it, three rows show total investment growth during the ladder, the traditional balance remaining at the end, and how many of the planned years the ladder actually ran.

Below the rows, a year-by-year schedule lists each year’s start balance, the amount converted, and the end balance. Growth is applied before each year’s conversion, and the ladder stops early if the balance runs out.

How to Use the Roth Conversion Ladder Planner

Enter your traditional IRA balance first — the pool the ladder draws from. Then set the annual conversion amount, which is usually sized to fill a tax bracket without spilling into the next one.

Add your expected annual return and the number of years. A 6% return over 10 years is a common planning baseline; adjust both to match your own assumptions.

Press Calculate. Read the headline for the total converted, scan the schedule for any year where conversions shrink — that is the balance running dry — and press Reset to test different conversion amounts.

How the Yearly Math Works

Each year follows the same three steps: the starting balance grows by the expected return, the conversion is taken from the grown balance, and whatever remains becomes next year’s start.

The formula for one year is:

end balance = (start balance × (1 + return)) − conversion

With a $300,000 start, 6% return, and $30,000 conversion, year one gives (300,000 × 1.06) − 30,000 = $288,000. The conversion cannot exceed the grown balance — the calculator caps it at whatever remains.

The Total Converted Headline

The headline sums every year’s conversion into one number: the total dollars moved from traditional to Roth across the ladder. In the ten-year example, that is $300,000.

This is the figure that matters for tax planning, because each year’s conversion is taxed as ordinary income in that year. A $300,000 total means $300,000 of taxable income spread across the ladder’s years.

The headline counts converted dollars, not tax paid. Budget the tax separately — the calculator’s note reminds you that taxes owed are not subtracted from the schedule.

Total Investment Growth

The growth row totals the year’s returns across the ladder: $141,830 in the example. This is the money your investments earned while you were climbing.

Growth is why the remaining balance can stay large even after years of conversions. The example converts $300,000 yet ends with $141,830 still in the traditional account, because growth kept refilling the pool.

Lower the expected return and watch the remaining balance fall — the schedule makes the compounding visible year by year instead of hiding it in a formula.

The Ladder Schedule Grid

The schedule’s four columns — Year, Start balance, Converted, End balance — are the ladder’s diary. Year 1 starts at $300,000, converts $30,000, and ends at $288,000; each subsequent year repeats the pattern on a slightly smaller base.

Watch the Converted column near the end of long ladders. If a year’s conversion drops below your planned amount, the balance ran out mid-ladder — the “completed in” row will show fewer years than you planned.

The grid is also where unrealistic assumptions reveal themselves. A 10% return keeps balances implausibly high; a 2% return drains them fast. The schedule does not judge your inputs — it just shows their consequences.

Worked Example: $300,000 Over 10 Years

Traditional balance $300,000, annual conversion $30,000, expected return 6%, ladder length 10 years.

First: enter the four values and press Calculate.

Each year converts the full $30,000, so the total converted is 10 × 30,000 = $300,000.

Then: total investment growth is $141,830, the traditional balance remaining is $141,830, and the ladder completes 10 of 10 years.

Answer: $300,000 converted, $141,830 of growth earned, $141,830 left in traditional — the ladder ran exactly as planned.

Worked Example: Ladder Runs Dry Early

Traditional balance $100,000, annual conversion $30,000, expected return 4%, ladder length 10 years.

First: enter the values and press Calculate.

The $30,000 annual draw outpaces 4% growth on a shrinking base, so the balance hits zero before year 10.

Then: the schedule’s later years show shrinking conversions, and the “completed in” row reports fewer than 10 years with a $0 remaining balance.

Answer: the ladder cannot sustain $30,000 a year from $100,000 at 4% — the schedule shows exactly where it breaks.

Worked Example: Small Conversions, Long Ladder

Traditional balance $200,000, annual conversion $15,000, expected return 6%, ladder length 15 years.

First: enter the values and press Calculate.

The modest $15,000 draw lets 6% growth nearly keep pace, so the balance declines slowly across all fifteen years.

Then: total converted reaches $225,000 — more than the starting balance, thanks to growth — with a meaningful remainder still in traditional.

Answer: small conversions let growth do the heavy lifting; the total converted can exceed what you started with.

Why Conversions Are Taxed as Ordinary Income

Every converted dollar was deducted (or grew) pre-tax inside the traditional IRA, so the IRS collects ordinary income tax in the conversion year. There is no special conversion rate — the dollars stack onto your other income.

This is why ladder amounts are usually tuned to tax brackets. Converting $30,000 that fills the 22% bracket costs $6,600; the next dollar spills into 24% and costs more.

The planner shows dollars, not taxes, so pair it with a tax estimate for each rung. The schedule tells you what to convert; your bracket tells you what it costs.

The Five-Year Seasoning Rule

Each converted rung needs five years of seasoning before you can withdraw it penalty-free (with exceptions). The ladder metaphor is literal: you build rungs now to climb later.

The planner’s schedule does not track seasoning — it tracks dollars. Mark each year’s conversion date yourself and count five years forward before touching that rung.

This is also why ladders start years before the money is needed. A ladder begun at 55 funds penalty-free withdrawals at 60; one begun at 59 arrives too late for early retirement.

Edge Case: Zero or Negative Real Returns

The calculator accepts a 0% return, modeling a ladder drawn from cash-like holdings. Growth disappears and the arithmetic becomes pure subtraction: $300,000 at $30,000 a year lasts exactly ten years.

Negative returns are not accepted — the input caps at zero — but you can approximate a bad market by lowering the return and shortening the ladder, then stress-testing the plan.

Conservative return assumptions are a feature, not pessimism. A ladder that works at 4% will thrive at 7%; the reverse is not true.

Common Ladder Planning Mistakes

The most common mistake is sizing conversions without regard to brackets. A flat $50,000-a-year ladder can shove the top dollars into a much higher bracket than a tuned one — the planner shows the dollars, but you must map them to brackets.

The second mistake is forgetting the tax bill’s funding. The planner does not subtract taxes from the schedule, so a ladder that looks sustainable can still strain your cash flow in April.

The third mistake is ignoring the five-year rule. Converting at 59 and withdrawing at 60 invites penalties the dollar schedule never mentions — timing matters as much as amounts.

Where Ladder Planning Is Useful

Early retirees use ladders to bridge the gap between leaving work and age 59½, converting during low-income years when brackets are at their friendliest.

High earners use them in reverse: converting aggressively in a sabbatical or low-income year to move money at 12% instead of 32%.

Anyone with a large traditional balance uses the planner to answer the core question — how many years, at what amount — before committing to the first conversion.

How to Interpret Your Result Correctly

Read the headline for scale, the growth row for what compounding contributed, and the remaining balance for what is left to convert later. The schedule is the audit trail behind all three.

Treat the return assumption as the load-bearing input. Rerun the plan at two points lower than your hope; if the ladder still completes, the plan is robust.

Remember what is missing: taxes, the five-year rule, and bracket boundaries. The planner is the dollar engine of your plan — the tax strategy around it is yours to build, ideally with an advisor.

Frequently Asked Questions

1. What is a Roth conversion ladder?

A multi-year strategy of converting fixed amounts from a traditional IRA to a Roth IRA annually. Each year’s conversion is taxed as ordinary income, and each rung seasons for five years before penalty-free withdrawal.

2. How is each year’s end balance calculated?

With end = (start × (1 + return)) − conversion. Growth applies first, then the conversion is taken, and the remainder starts the next year.

3. What does “completed in X of Y years” mean?

How many planned years actually ran before the balance ran out. If it shows fewer years than you entered, the conversion amount was too large for the balance and return.

4. Why does the calculator cap conversions at the balance?

You cannot convert money that is not there. When the grown balance falls below the planned conversion, the calculator converts only what remains and ends the ladder.

5. Are taxes subtracted in the schedule?

No. The schedule tracks dollars moving between accounts; the tax bill on each conversion must be budgeted separately from outside funds or the conversion itself.

6. What return should I assume?

Use a conservative long-run figure for your allocation — many planners use 5 to 6% nominal for a balanced portfolio. Rerun at lower returns to stress-test the plan.

7. How do I choose the annual conversion amount?

Most people size it to fill their current tax bracket without spilling into the next. The planner shows the dollar consequences; your tax projection shows the bracket boundaries.

8. What is the five-year rule?

Each conversion must season five years before the converted amount can be withdrawn penalty-free (with exceptions). Track each rung’s date separately — the planner does not do this for you.

9. Can the total converted exceed my starting balance?

Yes. Investment growth during the ladder adds new dollars, so a long ladder at a decent return can convert more than you started with — the small-conversion worked example shows this.

10. What if I need the money sooner?

Then a ladder may be the wrong tool, or it should have started earlier. Withdrawing unseasoned conversions can trigger the 10% early-withdrawal penalty on top of taxes.

11. Does the ladder affect required minimum distributions?

Yes, favorably: every dollar converted is a dollar that will not be subject to future RMDs. Many planners convert aggressively before RMD age for exactly this reason.

12. Can I change the conversion amount mid-ladder?

In real life, absolutely — annual conversions are independent decisions. To model a changing amount, run the planner in segments, carrying the end balance forward as the next segment’s start.

13. What happens at 0% return?

The ladder becomes pure subtraction: balance divided by annual conversion gives the exact number of years. It is the most conservative possible projection.

14. Should I convert during a market crash?

Often yes — depressed balances mean less taxable conversion value for the same number of shares, which then recover tax-free inside the Roth. The planner’s return input lets you model the recovery.

15. Is my financial data saved anywhere?

No. The plan runs entirely in your browser and nothing is transmitted or stored. Reset or close the page and the numbers are gone.