JONATHAN CLEMENTS’S final book was released this week. Titled Money and Me, it traces the arc of Jonathan’s nearly four-decade career as a personal finance columnist.

Money and Me starts with the story of a man named George Cope, who was a nineteenth century tobacco baron. At the time of his death in 1888, Cope was one of Britain’s richest men. But within just two generations, his fortune was gone. Why? Cope’s daughter was the sole heir to her father’s fortune, but she lived what Jonathan described as a Downton Abbey lifestyle, on an estate in the Cotswolds with five homes and eight children. Before long, the fortune was gone.

This story was of interest to Jonathan because George Cope was his great-great-grandfather. He called it the “big family story” and explains that this hard financial lesson was imprinted on everyone in his family from a young age.

In part because of this family story, Jonathan got interested in personal finance, and, among his peers, was early in focusing on the psychology of money. “I like to think I’m rational in the way I spend my dollars, and I suspect most readers do, too. We are, of course, deluding ourselves,” he wrote.

Early in his career, Jonathan covered mutual funds for Forbes, then The Wall Street Journal. Each week, he'd review a different fund and interview the fund’s manager. From that vantage point, he was early in recognizing a reality about Wall Street: that they’re great marketers but not such great investment managers. After reviewing scores of actively-managed funds, Jonathan came to the conclusion that index funds were a better way to go for most investors.

Since the investing question was “solved,” as he put it, by index funds, Jonathan turned his attention to other domains in personal finance. The relationship between money and happiness was of particular interest. Though he acknowledged that each of us has a happiness “set point” that is largely fixed, he pointed out that our happiness level isn’t entirely fixed. There’s plenty we can do to move the needle.

A chapter titled “15 Ways to Happy” includes a number of practical suggestions. Among them: Jonathan always recommended making plans—especially vacation plans—far in advance. Why? “Often, the best part of a purchase or experience is the anticipation,” he explained.And since it doesn’t cost more to book early—indeed, it often costs less—that was his recommendation.

Jonathan leaned heavily on academic research and helped translate its findings for everyday investors. In Money and Me, he explains concepts from psychology including the hedonic treadmill, eudaimonic happiness and many others. Jonathan acknowledged that there’s no magic wand for achieving happiness. On the other hand, he explains why a million-dollar salary isn’t a necessary ingredient for financial contentment.

Jonathan also wrote a lot about spending. On the one hand, owing to his family’s experience, he developed frugal habits early in life, and he was grateful that those habits led to financial independence by age 50. On the other hand, he knew that frugality could be taken too far. In a chapter titled “Don’t Overdo It,” Jonathan offers a menu of ideas to help others who might similarly struggleto loosen the purse strings.

Jonathan had two children and thought a lot about how best to convey money values to them. He knew the risk in helping too much. “Money doesn’t necessarily kill all ambition. But it seems to put a big dent in financial ambition,” he wrote. For that reason, Jonathan mostly emphasized education rather than direct financial assistance. 

He describes, however, one important way in which his own parents helped him: They always made it clear that they were there for him as a backstop. Though he might have never needed it, simply knowing this support was in the background gave Jonathan the confidence to always invest heavily in the stock market. He describes maintaining an allocation to stocks that was regularly above 80% or even 90%. That kind of aggressive investing ran contrary to the textbook. But recognizing the benefit it had provided during strong markets over the years, Jonathan offered a similar backstop to his own children, thus allowing them to take risks that they might not have otherwise.

In choosing a heavy allocation to stocks, Jonathan explains some of the other factors that went into his thinking. For starters, he points to the role of financial forecasters. They’re often wrong, but that doesn’t stop them from waking up the next day with something new to say. As a result, during both stock market rallies and routs, prognosticators can be found on TV telling stories that often cause investors to overreact. In the chapter “Not Scared of Bears,” Jonathan walks through the math that should give investors the courage to ignore forecasters, to keep their feet on the ground and to stay fully invested regardless of what bad news happens to be in the headlines.

Jonathan was willing to pile on even more risk in his portfolio when markets declined. He acknowledged that this opened him up to the accusation of being a market timer—“pretty much the nastiest insult you can hurl”—but he explains a subtle difference between his approach and true market timing, then offers a helpful strategy for profiting from downturns.

Jonathan Clements was one of a kind. Like all of his readers, I miss his kindness, wit and good cheer. For decades, he helped readers navigate the potholed road known as Wall Street. With his final work, Jonathan leaves us with a timeless guide to thinking about money in uniquely sensible ways.

I WAS RECENTLY asked about strategies that high earners can use to reduce their tax bill.

Most people know the usual options. They contribute to a 401(k), fund a health savings account or make a Roth IRA contribution through the backdoor method. Business owners may have additional opportunities through retirement plans and business structures.

But there's another strategy worth knowing about: the Mega Backdoor Roth (MBDR).

The MBDR allows some workers to put far more money into Roth accounts than the usual contribution limits permit.

Consider somebody who contributes the maximum $24,500 to a 401(k) in 2026 and receives a $5,000 employer match. If the employer's retirement plan allows after-tax contributions, that worker may be able to contribute an additional $42,500 to the retirement plan.

This is because the total 401(k) contribution limit for 2026 is $72,000. That limit includes employee contributions, employer contributions and after-tax contributions. Subtract the $24,500 employee contribution and the $5,000 employer match, and there's room for another $42,500. Workers age 50 and older might be able to contribute even more ($80,000 total 401(k) limit in 2026) because of catch-up provisions.

For savers who have already exhausted other retirement account options, this can be a powerful way to build additional tax-free savings.

The catch

Your employer's retirement plan must permit after-tax contributions.

Many plans don't. According to Fidelity, only about 11% of employer-sponsored 401(k) plans offer MBDR conversions.

If you log into your retirement plan and review your contribution options, you may see a category labeled "after-tax." That's the option you need:

Importantly, don't confuse it with a Roth 401(k). They're similar, but different. Small-business owners with a solo 401(k) may also be able to use this strategy if their plan allows.

The MBDR process generally involves two steps:

1. Contribute money to the plan's after-tax account.
2. Move those funds to a Roth account.

Depending on your plan, the money may be rolled into either a Roth IRA or a Roth 401(k).

The rules vary from plan to plan. Check your plan documents or summary plan description before enganging in this strategy.

Why use it?

Suppose you've already maxed out your traditional 401(k) contribution and completed a backdoor Roth IRA contribution. You now have additional money to invest.

One option is a taxable brokerage account. Another is the Mega Backdoor Roth.

The Roth strategy offers several potential advantages:

• Future growth can be tax-free.
• Dividends aren't taxed each year.
• Rebalancing investments doesn't trigger taxable gains.
• Retirement assets may receive creditor protection under federal law.

A taxable brokerage account also has advantages:

• No contribution limits.
• No age-based withdrawal rules.
• Greater flexibility if you need access to the money before retirement.

That flexibility shouldn't be overlooked. Retirement accounts come with restrictions, and those restrictions may matter depending on your goals.

Importantly, some plans allow you to move after-tax contributions to either Roth IRA or Roth 401(k) accounts. A Roth 401(k) may be simpler because some plans offer automatic conversions. A Roth IRA typically offers a wider range of investment choices. It may also provide greater flexibility when it comes to withdrawals.

I generally prefer the Roth IRA option when it's available. Still, either choice can work well.

Mind the earnings

After-tax contributions are usually invested while they remain in the 401(k).

If the account earns money before the conversion takes place, those earnings are taxable when moved to the Roth account. For that reason, many investors try to complete the conversion quickly. Some plans even allow automatic conversions.

Suppose you contribute $10,000 to the after-tax portion of your 401(k). Before the conversion occurs, the account earns $100.

You then move the balance to a Roth IRA. The entire $10,100 can be transferred, but the $100 of earnings will generally be taxable if you put it all into Roth IRA. There are plans that allow you to split between Roth and Traditional, which could be helpful.

At year-end, you'll receive Form 1099-R reporting the transaction.

Using the example above, your tax return would show a $10,100 distribution, with $100 generally treated as taxable income.

If you work with a tax professional, make sure they understand exactly what happened. The reporting isn't especially complicated, but it should be handled correctly.

The Mega Backdoor Roth isn't available to everybody. But for those whose retirement plans allow it, the strategy offers a chance to put a substantial amount of additional money into a Roth account and enjoy tax-free growth for years to come.

Have you used this strategy to contribute to your retirement accounts? Let us know in the comments!

Bogdan Sheremeta is a licensed CPA based in Illinois with experience at Deloitte and a Fortune 200 multinational.