David McKnight addresses one of the most common questions he gets: "If tax rates are going to be dramatically higher in the future, shouldn't I be putting every dollar into a Roth 401(k)?".

Moreover, people often wonder whether they should be converting as much of their IRA to Roth as quickly as possible.

David is a firm believer that the current tax rates are as low as we're likely to see in our lifetime.

The U.S. has over $39 trillion in debt and it's going to increase by two trillion per year over the next 10 years and over $200 trillion in unfunded obligations for Social Security, Medicare, and Medicaid.

Many people make the critical mistake of thinking that every retirement plan contribution should be immediately redirected into Roth accounts.

However, David stresses, if you're a high-income earner contributing heavily to a Roth 401(k) today may actually be one of the most expensive tax decisions you can make.

David explains why he has long argued that 24% is the sweet spot.

The so-called Retirement Income Valley is the window of opportunity that opens up immediately after retirement and before social security required minimum distributions kick in.

David touches upon IUL and why he doesn't suggest that it should replace your 401(k) or serve as a stock market alternative…

Remember: your 401(k) should remain the primary engine driving your retirement plan.

Once you've maximized that tax deduction, an IUL can serve a very important supporting role, though.

An Ernst & Young study examined what happens when retirees allocate a portion of their retirement savings to a maximum-funded index universal life policy.

Researchers found that if you could divert 30% of your retirement contributions to an IUL with the goal of saving 3-5 years of living expenses by day one of retirement, it helps shield you from stock market volatility.

"The IUL isn't designed to replace the investment portion of your portfolio, it's there to protect it", clarifies David.

The best retirement strategy isn't the one that sounds the most compelling, it's the one that maximizes the likelihood that your money lasts as long as you do.

Mentioned in this episode:

David's national bestselling book: The Guru Gap: How America's Financial Gurus Are Leading You Astray, and How to Get Back on Track

DavidMcKnight.com

DavidMcKnightBooks.com

PowerOfZero.com (free video series)

@mcknightandco on Twitter

@davidcmcknight on Instagram

David McKnight on YouTube

Ernst & Young