Quick recap with Matt and Laura, early 40s (details slightly modified for anon)
- No kids or pets
- Great careers (household income >$600k)
- Love to travel and enjoy life
Their expenses are very reasonable given their income. A low-rate mortgage (3.75%) and strong savings habits that only kicked into high gear over the past year.
It was clear that they’re thoughtful, curious, and very intentional about wanting to be smart with their money. With that, as new clients our relationship started with a mistake, a confession.
The “Too Easy” Problem
Both have been making excess contributions to their Roth IRAs.
Not intentional, not reckless, just a simple common mistake because it’s easy. There was no shame or embarrassment, it was simply that they just didn’t know what they didn’t know.
[Roth IRA Income Phase-Out for 2026:
- Single Filers: Full contribution below $153,000; reduced contribution between $153,000 – $168,000; no contribution above $168,000.
- Married Filing Jointly: Full contribution below $242,000; reduced contribution between $242,000 – $252,000; no contribution above $252,000.
If you’ve exceeded Roth IRA income limits, it is typically best to withdraw the excess contributions and earnings, recharacterize them to a traditional IRA, or apply them to next year’s contribution, all ideally before the tax deadline to avoid penalties, or use a “backdoor Roth” strategy for future contributions. The ideal solution depends on timing and your overall financial situation, but withdrawing the excess contributions quickly is the most common solution to avoid the 6% IRS penalty.]
As we work with clients, these are some of the questions we typically tackle.
- Which accounts matter most at this income level?
- What should be automated, what needs professional oversight?
- What does retiring early actually require, real numbers?
Above a certain income level, being “generally good with money” stops being enough.
The people who generally benefit most from financial planning are:
- High earners
- Fast movers
- Builders who value efficiency and independence
Ironically, the same traits that make someone successful can also make it easier to overlook coordination and sometimes the most valuable part of planning isn’t the strategy itself, it’s having someone slow the process down and connect the dots.
— Nic
This case study is a hypothetical scenario based on common client experiences. Names, details, and outcomes are illustrative only and are not intended to represent any specific individual or guarantee results. Investing involves risk and you may incur a profit or a loss regardless of strategy selected. No investment strategy can guarantee your objectives will be met. Every investor’s situation is unique, and you should consider your investment goals, risk tolerance and time horizon before making any investment decision.
