Risk-Managed Portfolio Designed to Generate 8-12% in Annual Income
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Roth IRA Conversion Showdown:
Right Capital Vs. OnPointe (It’s Mind Blowing)
Download my 18-Page Critique of Right Capital (what’s wrong with…)
Download a 39-Page Right Capital Roth Conversion Recommendation
Download 4 different OnPointe Roth Conversions recommendations
Click on the following to get the downloads:
https://onpointesoftware.com/onpointe-vs-right-capital
If you think Right Capital is running accurate retirement planning recommendations and/or accurate Roth conversion recommendations, you will be shocked when you read my critique with specific explanations as to why their numbers are not accurate!
It is also my opinion that programs like Retirement Analyzer, MoneyGuide Pro, Emoney, Income Lab, and many others are also NOT running accurate conversion numbers, but this newsletter’s focus is on Right Capital.
Why write about Right Capital this week? An advisor recently signed up for our OnPointe (OP) Retirement Planning software and asked us to compare RC’s Roth conversion numbers to OnPointe with a real client. The advisor couldn’t figure out how RC was running their numbers, and he liked the transparency of the numbers in OnPointe. So, it made sense for me to run comparison numbers, and after I did, I knew I had to share them in a newsletter.
Right Capital is NOT Running Accurate Income Tax Calculations
What became crystal clear to me is that Right Capital is not calculating income taxes correctly. Their numbers seem like they are from a fantasy world, and when you have inaccurate income tax calculations, two things happen:
1) It’s IMPOSSIBLE to run accurate Roth conversion numbers
2) It’s IMPOSSIBLE to run accurate retirement planning scenarios (with or without conversion)
Here is a taste of what’s in my 18-page critique:
Right Capital recommends the client convert $65,022 from the RIA in 2026. The client also has $38,004 in Social Security income and $1,292 in interest income.
Total gross income of $98,617 and taxable income calculated by Right Capital = $67,450
Right Capital estimates that the Federal income taxes due = $7,889.
The correct numbers from OnPointe for this single client with a gross income of $98,617:
Taxable income = $78,796
Federal taxes due = $14,650
Taxes due and paid in the Right Capital output are $6,761 less in year one of the conversion.
Every year there is a conversion, the tax due in Right Capital is wrong!
In my 18-page critique, I go through all the numbers of both Right Capital and OnPointe so you can see the several flaws with Right Capital and specifically how we calculate the numbers in OnPointe to avoid these flaws.
Medicare Premiums?
Right Capital does not take into account Medicare Part B and D premiums. This example client is projected to pay over $100,000 in Medicare premiums over her retirement lifespan. In other words, the Right Capital numbers are woefully underestimating the client’s expenses.
In OnPointe, we separately calculate the projected future Medicare premiums, and we automatically add those expenses to every fact pattern. When you do so, you get a much different retirement planning outcome as well as a Roth conversion outcome. I have examples in my 18-page critique illustrating how adding Medicare premium affects the outcome of a plan.
Legacy Planning
Not surprisingly, Right Capital doesn’t even bother with what arguably is the MOST important set of numbers for clients, e.g., how a conversion benefits their heirs.
In the best OnPointe example, if the client implemented the conversion, the heir(s) would be $251,029 better off at the end of the 10-year inherited time period.
Most clients are NOT given this information and, therefore, are not in a position to make a fully informed decision about whether to implement a Roth IRA conversion strategy.
Roth IRA Conversions are Complicated
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