Avoid These 4 Common Required Minimum Distribution (RMD) Mistakes

How great is it that a tax-deferred retirement plan allows you to invest pre-tax dollars? Such plans encourage saving for your golden years while reducing the taxes you owe. The only catch is this: When you invest in a tax-deferred retirement plan, you eventually must begin making withdrawals and pay taxes on the money withdrawn.Required minimum distributions (RMDs) are the minimum amounts you must withdraw from your accounts annually. Typically, you're required to begin making withdrawals from a traditional IRA, SEP IRA, SIMPLE IRA, or other traditional retirement plan at age 73 (or age 75 if you were born in 1960 or later). Your retirement accounts are there to help you live your golden years in comfort, and RMDs exist to remind you to make withdrawals (and pay your taxes!). While there's nothing especially complicated about RMDs, they can seem intimidating at first glance. However, if you can avoid these common mistakes others make, it should be smooth sailing for you.Continue reading

Apr 11, 2025 - 10:19

Avoid These 4 Common Required Minimum Distribution (RMD) Mistakes

How great is it that a tax-deferred retirement plan allows you to invest pre-tax dollars? Such plans encourage saving for your golden years while reducing the taxes you owe. The only catch is this: When you invest in a tax-deferred retirement plan, you eventually must begin making withdrawals and pay taxes on the money withdrawn.

Required minimum distributions (RMDs) are the minimum amounts you must withdraw from your accounts annually. Typically, you're required to begin making withdrawals from a traditional IRA, SEP IRA, SIMPLE IRA, or other traditional retirement plan at age 73 (or age 75 if you were born in 1960 or later).

Your retirement accounts are there to help you live your golden years in comfort, and RMDs exist to remind you to make withdrawals (and pay your taxes!). While there's nothing especially complicated about RMDs, they can seem intimidating at first glance. However, if you can avoid these common mistakes others make, it should be smooth sailing for you.