CHARLOTTE, NC (WBTV) - Unless you have someone to make all of the decisions about your finances for you, it's tough to know exactly what to do.
There are two deadlines approaching that may help you make the most of your money particularly when it comes to those who have converted from a traditional to a Roth IRA.
The first is October 15th. By then you have to decide whether you made a mistake putting your money from a traditional into a Roth IRA within the past year.
Perhaps the value dropped or you can't afford to pay the taxes on it. This is an opportunity to acknowledge you made a mistake and you can put that money back into a traditional IRA.
Financial advisor Chris Hobart explains why re-characterization might be something to think about.
"What if you've lost money in that account since you converted. Perhaps you had a traditional IRA worth $100,000 and you converted and you lost. If you've lost money on that, guess what? You pay taxes on $100,000 but it's worth $80,000. You just might want to convert back to a traditional and save money on taxes," Hobart said.
Another important deadline to remember is that between now and the end of the year is your opportunity if you want to do that Roth conversion for this tax year.
"This is the first and only year Uncle Sam will allow you to spread the conversion tax over 2011 and 2012 tax years. That means you can convert from traditional to Roth and allow that money to be paid taxes on over 2011 and 2012. We haven't seen that before and I don't think it will happen again," said Hobart.
Keep in mind, if you do that and taxes go up, you may be spreading out those payments but you're doing so at a higher tax rate.