Check out the latest Practical Planning Tip by ParkBridge Wealth Management on Being intentional with your Required Minimum Distributions (RMDs).
Required Minimum Distributions, or RMDs, generally apply to folks 73 or older. If you are subject to RMDs and if you don’t take them out there will be a penalty. If you don’t need your RMDs to pay your living expenses, explore other options like Qualified Charitable Distributions or QCDs
QCDs are available for folks who are 70½ or older and it allows them to donate all, or a portion, of their RMD directly to charity. QCDs are limited to $100,000 maximum annually per taxpayer. Regardless of the amount of your RMD for the year.
Planning Tip: Be INTENTIONAL with how you handle your RMDs. This means reviewing your cash flow to see if you need the funds to pay your bills. If not, perhaps you can use these funds to achieve legacy or charitable goals in a tax efficient manner, as I just mentioned. There are many opportunities to efficiently handle RMDs. Don’t just go through the process of taking out the funds from your IRA without giving it any thought. Unfortunately, this unthoughtful approach is what is practiced by many and it’s a MISSED opportunity.
Hope you found this Practical Planning Tip helpful.