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Lifetime Planner IDEA: Improve how ROTH IRAs are Displayed and Modelled in LTP

Scooterlam

Lifetime Planner IDEA: Improve how ROTH IRAs are Displayed and Modelled in LTP

This is an idea post stemming from recent posts regarding ROTH IRA handling in LTP. Reference links below. In the first link, I conclude that ROTH IRAs are reasonably modelled in LTP. But, it could be much better....especially in terms of transparency in the Plan Result Tables and Graph.

Please vote! Add your comments and thoughts.

WHAT?

1. In the Plan Summary Tables, break-out ROTH IRA related Income, Expenses and Portfolio Values. ROTH IRA accounts (tax-free) are currently included under the tax-deferred account type. Very confusing and wrong. See image 1. Expand this transparency to Plan Result Graph and any other current or future LTP reports.

2. Proactively UPDATE ROTH IRA contribution limits as they change! Implement both normal and catchup contributions in LTP. As of this posting date, contribution limits in LTP are $ 5500. Current law permits $6000 per year ($7000 per year catchup contribution for those over 50). See Link. Lack of contribution limit maintenance has been an issue for all contribution limited account types...Yes, there are workarounds, but "broken windows" need to be fixed, then the modelling rules, already built in LTP, maintained going forward...timely.

3. Implement an early withdrawal penalty and tax of earnings (<59.5).

4. Building on # 3, expand the ROTH IRA withdrawal rules or "exception flows" in the LTP model. Image 2. Data for this is available from LTP user data, AGE of user is explicit and AGE of Account can be derived from the register data: (date of first ROTH withdrawal - first deposit date).

WHY?

1.  Reduce modelling error and confusion when Lifetime Planner includes ROTH IRA accounts.

2.  Provides a step-wise approach to other LTP related improvements such as Order of Withdrawal and ROTH Conversion modelling et al.

3.  Improves the competitive position of Quicken LTP feature to other planning tools.

Please vote! Add your comments and thoughts.

Image 1 - Breakout Tax-Free from Tax-Deferred

Image 2 - ROTH IRA Withdrawal Rules:

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Under Consideration

Windows

Lifetime Planner

Planning Tools

Status: Under Consideration

Comments

stevepowellcpa

I completely agree with this suggestion. The lifetime planner assumes withdrawals from regular IRA accounts will be subject to income taxes. On the other hand, qualifying withdrawals (and gains/income) in Roth accounts are non-taxable. This has a significant impact on future growth of the Roth Accounts

Scooterlam

stevepowellcpa said:

I completely agree with this suggestion. The lifetime planner assumes withdrawals from regular IRA accounts will be subject to income taxes. On the other hand, qualifying withdrawals (and gains/income) in Roth accounts are non-taxable. This has a significant impact on future growth of the Roth Accounts

Just in case....I wanted to clarify point #1 in the original idea post regarding taxation of Roth qualifying withdrawals.

In #1, I did not mean that Roth IRAs were taxed the same as traditional IRAs in LTP (and needed to be fixed). But rather, that Roth IRAs should be reported separately from traditional IRAs in plan result tables. That is, improve Roth account transparency in the plan result tables.

Image 2 shows what is and what is not currently built in LTP for Roth IRAs. Of course, points #3 and #4 further expand on Roth tax handling beyond what is done in LTP today.

joesdeli

These are all great ideas!

mikek753b

would 401k Roth also be added? pls
the LTP should show 2 more in the chart "Your Roth" and "Spouse Roth, which aggregates for all IRA Roth and 401k Roth

without OP proposal the LTP isn't much help when you have Roth accounts IMHO

is there any update from Quicken product to implement this?

overall there are several Roth related requests and proposals already, the Roth importance have increased over past years for many

LonPribble

Agree -- This would make me feel better about the LTP results I am getting. Also would like to have some "what if" on Roth conversions. How will that impact my taxes and IRMMA penalties.

Scooterlam

LonPribble said:

Agree -- This would make me feel better about the LTP results I am getting. Also would like to have some "what if" on Roth conversions. How will that impact my taxes and IRMMA penalties.

@LonPribble You mentioned Roth Conversions...Have a look at this Roth Conversion Idea for Lifetime Planner - comment, elaborate and vote if you please. By voting on an idea post, it helps Quicken's product team gauge user interest for possible future development.

IDEA: Add Roth Conversion Modeling in LTP - added 10.16.2021

mikek753b

any updates from Quicken for this request?
any ETA?

tnx

mikek753b

anyone from Quicken has looked at this proposal?
any hope Quicken to implement this missing part?

tnx

mikek753b

Quicken, any hope for this?

Rocket J Squirrel

Bump.

LeaningTower

These are all valid, excellent suggestions which Q developers should implement expeditiously.

(They should have implemented them YEARS ago. But I'm sure their "hot tub time machine)" is out of service.)

LeaningTower

Do Quicken programmers or managers monitor this board? All of these suggestions are long past due.

Chris_QPW

https://community.quicken.com/discussion/comment/20481327#Comment_20481327

Actually, they do (notice it is marked Reviewed, that is the moderators marking it such), and I take it that you voted for this idea? Because it looks like this idea just got the magic 50. For Quicken Windows, it takes 50 votes for them to send it to the developer group for consideration. So, they should change the status on it shortly.

bradster

LTP needs some updates. Roth handling is important.

mikek753b

As soon modern retirement planning software will add adequate budgeting as soon it will be too late for Quicken to retain 10+ years customers.

Just IMHO.

Looking forward for so much 10+ years customer demanding features.

Jim_Harman

Late in 2023 the powers that be at Quicken decided not to make any changes or improvements to the Lifetime Planner for the next year or so. Hopefully they will take this up again soon. See this discussion that summarizes the requested improvements for more info.

https://community.quicken.com/discussion/7713110/lifetime-planner-bug-and-idea-list-make-yourself-heard

Quicken Kristina

Hello All,

The status of this Idea has been changed to Under Consideration as it has reached enough votes and has been submitted to our Product and Development team for further review.

Thank you!