The 8-Year Window That Turns a $1.6 Million 401(k) Into a $310,000 Roth and a Bigger Social Security Check at 70

The decision appears constantly on retirement forums: a single filer in their early sixties, recently retired, with a seven-figure traditional 401(k), trying to figure out what to do during the gap between the last paycheck and the first Social Security check. The standard answer is “convert some to Roth.” The better answer is to treat the gap as a one-time engineering problem with a precise dollar size worth calculating carefully.

Consider a 62-year-old who just retired with $1.6 million in a traditional 401(k), $250,000 in a taxable brokerage, and a plan to claim Social Security at 70. Wages are zero. Social Security is eight years away. Required minimum distributions are eleven years away. Nothing else is pushing taxable income up. That is the most valuable Roth conversion window a single filer will ever see, and it closes the moment Social Security turns on.

Fill the 22% Bracket, Stop Exactly There

The 2026 single-filer brackets, adjusted under the One Big Beautiful Bill Act (OBBBA) passed in July 2025, run 12% on income over $12,400, 22% over $50,400, and 24% over $105,700. The OBBBA also made the rate structure permanent, removing the risk of a reversion to the higher pre-2018 levels. The standard deduction for a single filer under 65 is $16,100, and every dollar of conversion below that threshold is sheltered outright from federal tax.

The mechanic is straightforward: convert $105,700 from the 401(k) to a Roth IRA each year, filling the 22% bracket to the penny and stopping one dollar short of 24%. On a single-year basis, the federal tax bill comes to roughly $14,400. Repeat for eight years and the totals accumulate: $845,600 gross converted, about $115,000 in total federal tax, and an effective federal rate near 14% on the converted amount.

Pay every dollar of that tax bill from the $250,000 brokerage account, not from the converted amount. The brokerage covers it comfortably, and the full $105,700 lands in the Roth each year to compound tax-free. At a 7% growth assumption, eight annual conversions of $105,700 grow to roughly $1.3 million by age 73, when RMDs begin. None of that balance will ever generate a 1099-R.

The Two Side Effects Most People Miss

The first is the RMD shrink-ray. After eight years of conversions and interim growth, the original 401(k) balance falls from $1.6 million to roughly $1.2 million. That smaller base is what the IRS Uniform Lifetime Table will work against starting at age 73, producing smaller required withdrawals, less ordinary income, and less pressure on the brackets in the seventies and eighties.

The second side effect is IRMAA, the Medicare premium surcharge built on a two-year lookback. In 2026, the first surcharge tier kicks in at $109,000 of MAGI for a single filer. Crossing that line pushes Part B from $202.90 per month to $284.10, an $81.20 monthly jump triggered by a single dollar of excess income. The critical timing: MAGI at age 63 determines Part B and Part D premiums at 65. Heavy conversions at ages 62 and 63 are fine. A large conversion at 64 feeds directly into the first Medicare enrollment year. The cleanest sequencing is to front-load bigger conversions at 62 and 63, then taper or pause from 64 through 66 to keep IRMAA tiers quiet during the first two Medicare years, then resume up to the 22% cap from 67 to 69.

One more planning note: the OBBBA created a temporary senior deduction of up to $6,000 for taxpayers 65 and older, phasing out above $75,000 of income for single filers and running through 2028. That deduction does not apply during the 62-to-64 phase of this strategy, but it does come online at 65 and can open up a bit of extra bracket room for the final conversion years if MAGI stays below the phase-out threshold.

The Social Security Side of the Same Trade

Claiming Social Security at 70 instead of full retirement age at 67 raises the benefit by exactly 24%, the result of delayed retirement credits that accumulate at 8% per year. Full retirement age is now 67 for everyone born in 1960 or later, completing a decades-long phase-in under the 1983 Social Security reforms. In this scenario, that 24% boost translates to roughly $42,000 a year at 70 versus $34,000 at 67, an extra $8,000 per year for life, indexed annually for COLA.

The 401(k) and Social Security decisions are tightly linked here. The conversion window works precisely because no W-2 income and no Social Security benefit are competing for bracket space. Claiming at 67 instead of 70 would compress the final three conversion years into a far higher marginal rate and undo a meaningful slice of the tax savings this strategy is designed to capture.

Three Things to Do Before Year-End

1. Run the conversion in December, not January. Waiting until the last month of the year confirms the full year’s taxable income (interest, dividends, and capital gains in the brokerage) and lets the bracket-fill number be exact. A January conversion is essentially a guess at what the rest of the year will bring.
2. Pre-fund the tax outside the IRA. Keep at least $20,000 of the brokerage in something liquid. A short Treasury ladder is worth considering: as of late August 2026, 4-week T-bill yields are running near 3.7% and 52-week bills near 4.0%, keeping the tax reserve productive without tying up funds in anything that can decline in value. That way the April tax bill never forces a withholding from the conversion itself.
3. Map the IRMAA calendar before the 64th birthday. The 2026 IRS brackets are public; the CMS IRMAA tiers are public. If the planned conversion at 63 pushes MAGI past the first surcharge tier of $109,000, trim that year’s conversion and recover the room at 67 or 68. The two-year lookback is the mechanism that quietly costs retirees thousands in Medicare premiums before they ever see it coming.

Editor’s note: This pass updated the liquidity note in item 2 to reflect current Treasury bill yields (3.7% on the 4-week bill, roughly 4.0% on the 52-week bill, as of late August 2026) and added the specific Part B premium amounts that bracket the 2026 IRMAA first-tier threshold ($202.90 base vs. $284.10 at first surcharge), giving concrete dollar stakes to the MAGI timing discussion.

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