RMDs: The Basics

When you reach 70 and a half, the IRS requires you to take money out of your tax-deferred accounts, known as Required Minimum Distributions or RMDs. This can lead to tax problems if not planned properly. Experts recommend starting the conversation about retirement income planning in your late 50s or early 60s to create a plan that incorporates your tax-deferred accounts and avoids unnecessary taxes. By splitting your assets into conservative and aggressive pots, you can sell high and avoid selling low, creating a more stable financial future.