Clark Howard Praised a Listener Who Built a $1.3 Million Roth and the Reason Has Nothing to Do With Income Tax

On the March 27, 2026 episode of his podcast titled “Avoid Two Costly 401(k) Mistakes,” consumer expert Clark Howard delivered a warning most working-age savers never hear: stuffing every retirement dollar into a traditional 401(k) can set you up for a stealth tax in retirement called IRMAA.

Clark said: “That’s not subject to this tax called IRMAA that you have to pay. If you got a lot of money in a traditional 401k or IRA.”

He made the same point a few weeks earlier, praising a longtime listener who built a Roth balance “just under $1.3 million” at required minimum distribution age. Clark called it “one of the big advantages of the Roth, it’s not going to affect your Medicare premiums, not going to have to worry about Irmaa. Irma is something you don’t want to know about.”

The verdict: Clark is right, and the math is uglier than people think

I’ve been tracking the Roth versus traditional debate for years, and the IRMAA angle is the one most savers in their 30s and 40s never run the numbers on. If you’re reflexively dumping every dollar into pre-tax 401(k) for the deduction today, you’re quietly building a Medicare tax bill for your 70s.

Here’s the mechanic. IRMAA stands for Income Related Monthly Adjustment Amount. It’s a surcharge layered on top of Medicare Part B and Part D premiums once your modified adjusted gross income crosses a threshold. As one Clark Stinks letter put it years ago, “the IRMAA will be deducted from their monthly Social Security check.” Medicare skims it directly off your Social Security check before you ever see the money.

The brackets are cliffs. Cross a threshold by one dollar and your full premium jumps to the next tier. For 2026, the standard Part B premium is roughly $185 per month. At the top IRMAA tier, a single retiree can pay close to $628 per month for Part B alone, plus a Part D surcharge. That’s roughly $5,300 a year in extra Medicare costs per person for crossing an invisible income line.

Why a fat traditional 401(k) is the trigger

Required minimum distributions start at age 73. The IRS forces you to pull a percentage of your traditional 401(k) and IRA every year, whether you need the cash or not. Every dollar of that RMD lands on your tax return as ordinary income and counts toward the MAGI number that determines IRMAA.

Run the numbers on a saver who reaches 73 with $2 million in a traditional IRA. The first-year RMD is roughly $75,000. Add Social Security of about $40,000 and any pension or dividend income, and a single filer is already deep into IRMAA territory. The same $2 million in a Roth produces a $0 RMD. As one listener wrote to Clark, the Roth has “uninterrupted consistency to grow. While a traditional IRA is dismantled by RMD’s required minimum distributions, the Roth continues to accelerate faster tax free past the age of 73.”

The one variable that decides this for you

The factor that flips Clark’s advice from brilliant to wrong is your current marginal tax bracket versus your expected retirement bracket. Wes Moss laid out the framework on Clark’s show: “if you’re in the 30% tax bracket today and you’re working, you have a high income, to convert money into from the 401 to the Roth will cost you 30% in taxes… But if you get to retirement and your retirement tax rate is 15%, then it is not a good idea to do a Roth conversion. It’s about taxes today versus taxes in the future.”

If you’re a software engineer in the 32% bracket today and you’ll retire in the 12% bracket spending $60,000 a year, traditional wins. If you’re a 28-year-old in the 22% bracket on track to accumulate $2 million by 73, your future RMDs plus Social Security will likely push you into a higher bracket than you sit in now, and IRMAA will pile on top. Roth wins.

What to actually do this week

1. Pull up your 401(k) portal and check whether your employer offers a Roth 401(k) option. Clark notes a majority of plans now do, though “there’s still like a third of employers that don’t offer that yet.”
2. Look up the current IRMAA brackets on Medicare.gov and project your RMD at 73 using a basic calculator. Multiply your projected traditional balance by roughly 4% for a first-year RMD estimate.
3. If your match goes to a traditional bucket (it almost always does), shift your own contribution to Roth so you build the two-bucket flexibility Clark preaches: a pre-tax pile and a post-tax pile.
4. If you’re mid-career with a heavy traditional balance, model partial Roth conversions during lower-income years before RMDs and IRMAA hit.

The deduction on your traditional 401(k) is real, but it’s really a loan from the IRS. Clark’s point is that the bill comes due in your 70s, and IRMAA is the surcharge most people never see coming until Medicare starts skimming it off their Social Security check.