Narrow Windows: Estimating the Household‐Level Opportunity for Roth Conversions

ABSTRACT

Roth conversions are frequently recommended for near‐retirees, but few households meet the structural conditions that make conversion worthwhile. Using the Survey of Consumer Finances (SCF), this study applies sequential screens—age 55–72, pre‐tax balances , income headroom, nonaccount liquidity, and unconstrained tax brackets—to estimate conversion prevalence. Roughly 1 in 16 near‐retiree households (6.23%) clear basic age, asset, and income criteria. However, fewer than 1 in 100 (0.93%) hold sufficient outside liquidity, and only 1 in 250 (0.41%) meet the “open‐window” criteria (no pension or Social Security income). By comparison, IRS data show 1.47 million taxpayers converted in 2022 (2.10% of IRA holders), reflecting activity outside this primary window. Screening should precede conversion modeling.