Step by Step Guide to the Backdoor Roth IRA: How to convert funds from your Traditional IRA to your Roth IRA at Vanguard (with screenshots)

Step 0: If you don't have IRA accounts at Vanguard, open a Vanguard Traditional IRA Account and a Vanguard Roth IRA account.

Step 1: Contribute to Vanguard Traditional IRA Account.

From the dashboard, clikc on your traditional IRA account. Select "Contribute to IRA" and then choose the account to fund your traditional IRA. This can be from an outside bank (checking) account or your Vanguard brokerage account if you have one. If you choose an outside bank account, your money will be held a few extra days until it settles before Vanguard will let you do the converstion step of the Backdoor Roth IRA process.

You may also need to choose the year for which the IRA contribution is for. Since I have already maxed out my 2025 contribution in 2025, my only option is for 2026. If you have not yet done your prior your contribution, you have until April 15, 2026 to make your 2025 contribution.

Enter how much you want to contribute or click the "Contribute my max amount availabile" button, then click "Continue". Click on "Submit".

Now wait a few days for the money to settle in your Traditional IRA.

Step 2: Convert Vanguard Traditional IRA to Roth IRA

Log back into your Vanguard account. Click on your Traditional IRA and you should see your funds in the account. Since I am under age 50, my max contribution is $7,500 but if you are age 50 or over, the max contribution is $8,600 for 2026.

Click on Convert to Roth IRA (circled in green in screenshot below).

The next screen that comes up will look like:

Click on "Start my Roth conversion"

The next screen will look like

Click on "Continue"

The next screen will look like

Click on "I agree" and then click on "Continue".

The next screen will look like

Select your "Traditional IRA" and click "Continue"

The next screen will look like

There is really no reason to only convert some of the funds when doing a Backdoor Roth IRA so select "Convert all of the account" and click "Continue."

The next screen will look like

Select your Roth IRA account that you want to convert the funds into. I only have one Roth IRA account at Vanguard. Click on "Continue".

The next screen will look like

Click on "Verify your 0% federal witholding election on form W-4R. A new window will open with a W-4F form.

Enter 0% for your rate of witholding. Sign the form electronically.

Return to the original Vanguard page that now shows 0% witholding for federal and tate taxes.

Select how you want Tax holding notice. You can select for it to be sent to your email, your address on file, click the box to not send the notice at all. Click "I agree".

The next screen should look like

If everything looks good, click "Submit".

Vanguard will confirm your conversion has been initiated.

Step 3: Invest your new contribution in your Roth IRA

Wait until the conversion is complete. Log back into your Vanguard account and invest the money you have contributed. If you don't invest it, it will set in cash.

To make a purchase, click on "Transact" and then click "Buy". Choose the low cost mutual fund or ETF of your choose and complete your order.

Congratulations! You have successfully used the Backdoor Roth IRA strategy for more tax advantaged investing.