RMDs

Required Minimum Distributions (RMDs) are the minimum amounts that retirement account holders must withdraw annually from certain tax-advantaged accounts, such as Traditional IRAs and 401(k)s, starting at age 73 (as of 2023). The purpose of RMDs is to ensure that individuals eventually pay taxes on their retirement savings. The amount you need to withdraw is based on your account balance and life expectancy factors. Failing to take the required distribution can result in significant penalties. Understanding RMD rules and calculating the appropriate withdrawal amount is essential for effective retirement planning and tax management in your later years