This is Motley Fool Answers. I'm Alison Southwick, and I'm joined as always by Robert Brokamp,

personal finance expert here at The Motley Fool.

Hi, Allison.

It's the May Mailbag, and this month we're joined by Naima Barnes. She's a financial planner

with Motley Fool wealth management, a sister company of the Motley Fool. Hi, Naima. Hello.

So today we're going to tackle questions about HSA's, long-term care insurance, health care insurance, and car buying, all that,

and so much more on this week's episode of Motley Fool Answers. All right, let's get into it.

Our first question comes from the Twitters. The question is, if the conversion

of funds from a traditional IRA to a Roth IRA is counted as income and taxed, then what

is the benefit of doing this?

Right. So whenever you convert money that's in a traditional account to a Roth, that

amount gets added to your taxable income. So if you convert $10,000, you have to add

that $10,000 to your income. So you're going to pay more taxes this year. The benefit

is that ideally you are in a lower tax bracket this year and you'll be in a higher tax bracket

in retirement. So basically, you're paying taxes today, I'm kind of prepaying, I'm really at a low rate,

so that you're going to get a better benefit when you retire.

There are all kinds of calculators on the Internet that will help you analyze this situation.

I found one at Calc XML, which is very quickly a little hypothetical here.

Let's say you're 35 and you're in the 12% tax bracket today.

You convert that $10,000 to a Roth. Let's say you're 35 and you're in the 12% tax bracket today. You convert that $10,000 to a Roth.

Let's say you're in the 22% tax bracket. In retirement, what's the difference? Well, if you do the

conversion, that account will provide $8,700 a year in retirement. If you don't do the conversion on an after-tax basis, the traditional

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