I've just started my first job after graduating from university. My employer offers only a traditional 403(b) with no roth option. Since I'm in a lower tax bracket today with this being my first job, I really want to take advantage of a Roth account. Hence I thought of starting a Roth IRA to supplement my traditional 403(b). I reasoned that in addition to saving, this would give me some tax diversification in the future as well. However, I believe that in around 2-3 years time, I will be ineligible to fund a Roth IRA due to my income being above the limits.
Now I've been reading that Backdoor Roth IRA's are a way to legally get around income restrictions for contributing to a Roth, but I have a few questions about the mechanics of nondeductible and backdoor roth IRA's:
1) How often can I use the backdoor strategy? Let me illustrate my question with an example: Assuming I'm already over the income limits to fund a Roth and I want only two types of retirement accounts - the traditional 403b with my employer and a Roth IRA. In year 1, I put $5,500 (or whatever be the limit then) towards a non-deductible IRA and then do a backdoor roth conversion. Can I do the same in year 2, 3, 4......? I guess my question is that if I wanted to, could I keep doing a backdoor Roth IRA conversion every single year?
2) If the answer to question 1 is yes, it indicates that every year, I will open a new non-deductible IRA and close it once the roth conversion is done. Am I understanding this correctly?
3) Can the backdoor conversion deposit funds into the same Roth IRA account or do I need to open new Roth IRA accounts every year (this would be tedious). Basically, if I'm opening a new non-deductible IRA every year and doing a backdoor conversion, can I add funds in years 2,3,4.... to my pre-existing Roth IRA?
Really appreciate any advice I can get
