RMD

Nuclear_N

That brokerage trap is real. So is the RMD with deferred. 100k a year will not deplete. Not a bad problem I guess. At least it’s in a decent broad index.

ElevatorMoney4359

Caught ResMed $RMD at the open and closed for 40%. Done for the day see u regards tomorrow. RMD will be a good buy around 190ish again later this week

dvdmovie1

"ELF (e.l.f. Beauty): 10%" I owned it originally from the $80's until a bit under $200 and sold after it started eroding off highs. Thought I'd left money on the table. Cut to: $50's. The re-rating of a consumer growth story is significant, see also: CELH. Can you do well after that? Sure, but it depends on why it re-rated and can it regain the kind of growth profile it had? Stuff like this (and CELH) were reminders why I don't like investing in consumer brands. "SFM (Sprouts Farmers Market): 9.1%" Nasty re-rating. Probably does okay going forward but given that it's not cheap, not the place to be if the economy cools. "ADBE (Adobe): 11%" I don't like it. Obviously not apples-to-apples, but it feels like it's going to be this sub's next PYPL: something that people go "but it's cheap" and "the buybacks" year after year as it erodes. It's clearly not operating in the same environment going forward that it's enjoyed for decades, I think even people bullish can agree on that. "NVO (Novo Nordisk): 9%" I bought some not that long ago. I'm glad that I emphasized LLY instead of owning NVO in recent years but it was cheap enough recently to consider. "RMD (ResMed): 7.5%" The TAM is going to be smaller going forward imho, so unless it becomes extraordinarily cheap I don't see the reasoning behind making this such a large position. "VEEV (Veeva Systems): 7.5%" Eh. It hasn't been that compelling imo in a while, even before the SaaS negativity. You are largely trying to be a value investooor and while there's nothing wrong with that, my one concern would be that your entire portfolio is going to be fairly correlated. You've done well lately as part of a rotation into names that haven't done as well, but if that rotation stopped tomorrow, you could easily see the opposite over the next 3 weeks. Selective bottom feeding is great, but imho it's allocating part of your portfolio to selected situations where you have a distinct thesis/near-term catalyst in mind - I wouldn't make it the entire portfolio. Something can be at a 5 year low and seem cheap but if it doesn't have a catalyst it can go to a 10 year low. Look at BSX back to where it was about 22 years ago. Good luck.

ElevatorMoney4359

Looking for ResMed $RMD to have another 5% drop in the next week or two so i can reenter before earnings. If I miss the boat, oh well

ElevatorMoney4359

ResMed RMD debit calls are so free

ElevatorMoney4359

If RMD ResMed drops below 200 in the next week it will be a great time to load more calls 6+ months out

ElevatorMoney4359

30 days until ResMed RMD earnings where it will absolutely rip. Institutional sentiment has done a reversal this past month after the stock became oversold

ElevatorMoney4359

ResMed $RMD ripping to almost 5% today after 4% on thursday. Up 13% on the week and month. Yet, WSB sleeps

ElevatorMoney4359

The sickest part about ResMed $RMD is that most people with sleep apnea havent even been diagnosed yet. Consumers are increasingly interested in their sleep and health tracking (see google fitbit air, whoop, garmin cirqa, etc) which indirectly navigates patients to getting treatment for their poor sleep

ElevatorMoney4359

!banbet RMD 240 August 6

ElevatorMoney4359

Where ResMed $RMD gang at

Zestyclose-Rain-2943

The logic is generally sound and is often referred to as asset location rather than asset allocation. Higher expected return assets are frequently better suited for Roth accounts because all future appreciation can potentially be withdrawn tax-free. That said, I wouldn't optimize for taxes in isolation. Your overall portfolio risk, expected retirement tax bracket, RMD considerations, and rebalancing flexibility all matter. Optimizing the household balance sheet is usually more valuable than optimizing a single account

1h8fulkat

My nephew inherited an IRA from his dad and a life insurance payout. Input the payout in a UTMA and he receives an RMD (which you have to keep track of) annually from the inherited IRA. I put those proceeds into his UTMA as well and I invested it aggressively. He has tripled the value of those accounts in the last 8 years.

greytoc

Your situation is probably best discussed with your RIA if possible. With RMD and other factors - it usually is a lot more complicated than just picking an allocation. It's also going to depend a lot on your personal risk tolerance and how much you plan to withdraw.

jdub965

Not true if you have a very substantial pretax account going in to retirement with a pension plus social security for recurring income. Withdrawals and a pension will likely trigger IRMAA and NIIT which are additional costs. This will become even more acute when you are forced to take RMD’s and effective tax rate increases.

Qs9bxNKZ

Yes, to a degree. Don't believe everyone who says "put as much in" because it's not always fiscally wise. There is a cap of about $75K per year for a 401K if you include things like after-tax income. If it were absolutely advantageous, people would max out - and they don't. Maximize the pre-tax contribution (with or without the company match) up to a point. What you want to do is then forecast until you're about 73 years of age and determine what your required-minimum-distributions will be. If your RMD is going to be massively heavy in terms of taxable income, that means you're contributing too much - this is why the full $75K / yr contribution is not worth it. In order : 401K up until the pre-tax max is it for most people, IRA again capped about $8000/yr or whatever it is, then an equities account.

Silver_Surfer_60

If you were born in the year 1960 or later, RMD's kick in when you turn 75.

scubajay2001

401K simply means your employer contributes too. Within that bucket, their contributions are made as a "pre-tax" and thus lowers their obligation on it. There's also likely vesting tied to it based on your tenure. When it comes to YOUR contributions you can either make them as a pre-tax deduction from your income, or post-tax as a Roth contribution. So, in your scenario if you make $100K and contribute 10% to a 401K here's the impact both ways: \- Just making the Safe Harbor contribution means your annual taxable salary is now $90K. But, when you go to take that money out, it will be taxed on withdraw (possibly at a higher rate if taxes go up). If you wait until you are 73, you'll be forced into taking a withdraw of a certain minimum at that time, called a Required Minimum Distribution (RMD). \- Making a post tax contribution, means your taxable income is still that $100K. Because you've already made your tax payments, it now is growing tax free and you can take it out without owing anything (after 59.5) without penalties. No RMDs either, leave it in, take it out as you prefer. With a 10-15 year horizon, I'd go with Roth at this point...padding that as much as you can now is better because it'll grow past your retirement date, and hopefully you won't need it too soon, so it can continue to grow tax free.

HolidayTangerine2753

An example response from Hermes:  **Top opportunities (quality + on sale + stable)** **INTU — Intuit @ $296.76** \- ROE: 22.5% | Margin: 21.9% | Debt/Eq: 33% \- Rev growth: 10.4% | P/E: 18.1 \- **Down 63% from 52-week high**, -27% in 30 days \-  QoQ numbers look distorted: revenue +84%, income +342%, margin +21%. This smells like acquisition accounting (Mailchimp/ProConnect) or a one-time tax benefit. Don't trust the acceleration signal here without reading the latest 10-Q. **NFLX — Netflix @ $82.18** \- ROE: 48.5% | Margin: 28.5% | Debt/Eq: 54% \- Rev growth: 16.2% | P/E: 26.5 \- Down 38.7% from high, -6.9% in 30 days \- QoQ: income +118%, margin +23%. Fundamentals accelerating while price drops. Still a strong compounder; the drop may reflect subscriber saturation fears or competitive pressure. **NEM — Newmont @ $99.71** \- ROE: 25.8% | Margin: 33.9% | Debt/Eq: 16% \- Rev growth: 45.8% | P/E: 12.9 \- Down 25.8% from high \-  Gold miner = cyclical. That 45% revenue growth and 33% margin could be peak-of-cycle. Low P/E in mining is often a trap, not a bargain. Treat as a commodity bet, not a durable compounder. **RMD — ResMed @ $196.04** \- ROE: 25.2% | Margin: 27.4% | Debt/Eq: 13% \- Rev growth: 10.8% | P/E: 18.9 \- Down 32.8% from high \- QoQ is flat (rev +0.6%, income +1.6%). Stable but not accelerating. Medical devices moat is solid; GLP-1/weight-loss drug overhang may be pressuring sleep-apnea sentiment. **MKC — McCormick @ $47.24** \- ROE: 25.3% | Margin: 23.1% | Debt/Eq: 65% \- Rev growth: 16.7% | P/E: 7.7 \- Down 37.8% from high \-  That P/E 7.7 and QoQ income +351% / margin +42% scream one-time gain or restructuring benefit. Do not trust the screen alone here. **PODD — Insulet @ $153.22** \- ROE: 23% | Margin: 10.4% | Debt/Eq: 78% \- Rev growth: 33.9% | P/E: 35.8 \- Down 57% from high \- QoQ revenue -2.8%, income -10%, margin -1%. Slight deterioration — watch closely. Omnipod competition heating up? **ROL — Rollins @ $47.10** \- ROE: 38.7% | Margin: 13.8% | Debt/Eq: 77% \- Rev growth: 10.2% | P/E: 43.2 \- Down 28% from high \- QoQ revenue -0.7%, income -7.4%. Pest control is recession-resistant but not immune. High P/E means expectations are still priced in.

Possible_Sign_2564

For this topic, I’d look less for a general investing podcast and more for episodes from CFP/CPA types who focus on retirement tax planning. The areas you’re talking about are pretty specific: Roth conversions, withdrawal order, tax brackets before/after retirement, capital gains harvesting, RMDs, Social Security timing, and how taxable/Roth/traditional accounts work together. A lot of normal investing podcasts touch taxes, but they don’t go deep enough to be useful for actual planning. I’d search for terms like: “retirement tax planning” “Roth conversion ladder” “tax-efficient withdrawal strategy” “asset location” “capital gains harvesting” “RMD planning” I’ve found the most useful content is usually from fee-only planner/CPA-style shows, not stock-picking or market commentary podcasts. The big thing is learning the framework: which account to pull from, in what order, and how that changes depending on tax bracket, FIRE timeline, and retirement date. Are you mainly trying to learn this for your own FIRE/retirement plan, or because you want to eventually help other people with planning?

ConsequenceFade

A 401k had required minimum distributions. So it does not potentially hurt tax revenue as much as a Roth which never has RMD. Also, if tax rates go up in the future, 401k are still affected but not the Roth. Don't ask me about the backdoor roth with which came later.

ElevatorMoney4359

Anyone else have a long position in ResMed $RMD this stock is undervalued 20k in calls 15k in stock

ElevatorMoney4359

Anyone else have money on Resmed $RMD. whats your position? I have 20k on 200/240 1/27 calls

jvaritek33c

**First — confirm an RMD is even owed, and check you're not already late.** For a non-spouse beneficiary under the 10-year rule, whether you must take *annual* RMDs depends entirely on whether the original owner had reached their required beginning date (RBD) when they died: - **Died on/after their RBD** (i.e. was already taking their own RMDs): you must take an annual RMD in years 1–9 and empty the account by year 10. Starting in 2025, missed RMDs can result in penalties [Keystonecapitalpartnersgroup](https://www.keystonecapitalpartnersgroup.com/blog/what-you-need-to-know-about-the-2025-changes-to-inherited-ira-rules) — a 25% penalty on the amount you should have withdrawn, reducible to 10% if you withdraw the right amount within two years and file Form 5329. [CNBC](https://www.cnbc.com/2025/10/24/inherited-iras-change-2025.html) - **Died before their RBD:** no annual RMD required — you just have to empty it by the end of year 10, on whatever schedule you like. So "letting it build up and compound" is only fully available in that second case. If the owner had started RMDs and you inherited ~a year ago, a distribution may already have been due (the deadline is Dec 31), and that's a penalty exposure to clean up. (If you're a *spouse* beneficiary, ignore all of this — you have separate, more flexible options.) **On the timing question itself, assuming you have discretion:** The honest framing is that it hinges on whether you need the cash. If it's funding living expenses, monthly makes sense — steady income plus dollar-cost-averaging out, so no single bad day matters. If you're reinvesting it into a taxable account, a year-end lump is the textbook move: it leaves the money compounding *tax-deferred* inside the IRA as long as possible. And even if you have full discretion through year 10, letting it all ride to the final year usually backfires — one giant taxable distribution can spike you into a higher bracket, so spreading across years is generally smarter than maximizing compounding. **On "good day vs. dipped day" for the lump:** Two things make this matter less than it feels like it should. The RMD is a *fixed dollar amount* (prior Dec 31 balance ÷ your life-expectancy factor), so the day doesn't change what you owe. And if you're selling to raise the cash, an up day is marginally better only because you liquidate fewer shares to hit that dollar figure — but daily timing isn't something you can reliably call. The cleaner answer: you don't have to sell at all. Take the RMD **in-kind** — transfer the shares themselves to a taxable brokerage account. The value on the transfer date satisfies the RMD, you stay continuously invested, and you never lock in a dip. You just need cash elsewhere to cover the taxes, since the distribution is taxable income regardless of whether you sold. I'm not a financial advisor, and the RBD determination above is the kind of detail worth confirming with a CPA or the IRA custodian, since the penalty math turns on it.

ElevatorMoney4359

Someone talk to me about their Resmed $RMD position and conviction

MayorMcCheezz

The boomers are addicted. When I visit my grandparents in the retirement home. There was a lot of old people talking about how they have their RMD deposits already set up to buy new stocks.

Nicole_FreeWill

The ETF route gets complicated because most ESG or thematic funds are structured around investing in companies aligned with a cause, not donating to it. The returns go to you. The cancer research hospitals are not seeing a dollar from your share appreciation. If the goal is actually getting money to the cause with some tax efficiency, a donor-advised fund is closer to what you are describing. You contribute appreciated assets, get the full deduction in the year you contribute, then grant out to specific organizations over time. Fidelity Charitable and Schwab both have DAFs with no minimum grant size. The other option if you are 70 and a half or older is a QCD directly from an IRA. Goes straight to a qualifying charity, never hits your income, counts toward your RMD. From the nonprofit side this is one of the cleanest ways to give because there are no capital gains complications and the acknowledgment is straightforward. I work at FreeWill, a planned giving software company

Nicole_FreeWill

The ETF route gets complicated because most ESG or thematic funds are structured around investing in companies aligned with a cause, not donating to it. The returns go to you. The cancer research hospitals are not seeing a dollar from your share appreciation. If the goal is actually getting money to the cause with some tax efficiency, a donor-advised fund is closer to what you are describing. You contribute appreciated assets, get the full deduction in the year you contribute, then grant out to specific organizations over time. Fidelity Charitable and Schwab both have DAFs with no minimum grant size. The other option if you are 70 and a half or older is a QCD directly from an IRA. Goes straight to a qualifying charity, never hits your income, counts toward your RMD. From the nonprofit side this is one of the cleanest ways to give because there are no capital gains complications and the acknowledgment is straightforward. I work at FreeWill, a planned giving software company

Lowfi-Concert

That money doesn’t get brought back in and reconverted to RMD once it’s smuggled out

KidfromConeyIsland

Just my 2 Cents…. 1st- great job on setting investment and retirement objectives!! I assume you have some $$$ in retirement accounts, if so, do not sleep on the benefits of a Roth IRA. I did and it’s the only regret that I have. As you age during retirement and pull RMD, the taxman will take a significant cut. You can reduce the cut with a Roth. Again, just my 2 cents, based upon experience and not from being a tax professional.

Nicole_FreeWill

Rolling the 403b into the IRA before your first RMD year makes the math cleaner and is generally the right call for simplification. Timing it before year 72 rather than right before year 73 gives you more flexibility and avoids any ambiguity about which account the RMD is calculated from. One angle worth thinking about before you get into RMD territory: if charitable giving is part of your plan, qualified charitable distributions become available at 70 and a half. QCDs let you direct up to 105,000 dollars per year directly from the IRA to a qualifying charity without the amount hitting your income. That keeps your AGI lower, reduces the Medicare premium impact, and satisfies part of your RMD in the most tax-efficient way available. From the nonprofit side, QCDs need to go directly from the custodian to the charity. If the distribution comes to you first it becomes ordinary income plus a separate donation. That distinction matters a lot for how organizations acknowledge the gift. I work at FreeWill, a planned giving software company

aVolatileAgent

This may or may not be what you are looking for, but I hope you find it helpful: We have an only child. By the time she was 8 or so, I noticed her not being as grateful for the things she received as I would have liked. One day, I had had enough, and we decided to stop buying the various things that she wanted (not necessities) except on her birthday and Christmas. In place of that, I told her she was going to be receiving a weekly allowance of $10 (this was roughly 2010). Of that $10, she had to save $2, keep $1 for charity, and the remaining $7 could be spent how she wanted. In addition, I opened her a kids' checking account and got her a debit card. This completely changed how she handled money. She began to prioritize her wants and actively saved for the things that were important to her. She started looking for sales/bargains. As she got older, I started teaching her the basics of budgeting and investing. I emphasized to her that the $2 she saved weekly was 20% of her "income". Once she started seeing her savings accumulating, she decided to start saving 25% of all the money she received for Christmas, birthdays, etc. I initially funneled all her savings into a HYSA. As her balance grew to a few thousand dollars over her teen years, I opened an additional brokerage account at Vanguard to invest her money (100% VTI). I boosted her balance by $250 per month with an IRA RMD I was receiving after my father died in 2009. That RMD wasn't enough to change my monthly situation, and I felt that he would have wanted it to benefit her. When she turned 16 and started a job, she started saving 25% of her pay. Since she wasn't earning enough to pay taxes, I directed all of that money to max out her Roth contribution each year. I added the RMD from my father's IRA each month to help meet the yearly max. She continued this through college graduation. Fast forward to now, as a 22-year-old out in the world with a job and paying her own way...she has almost 10k in a HYSA, 25k in a taxable brokerage, and 60k in Roth. She is continuing to save 20% of her take-home pay for retirement. The other thing I did for her financially was add her as an authorized user on several of my credit cards when she was as young as 12. She never had access to the cards, but I wanted to start her credit history. When she turned 18, she got her own card. I taught her not to buy anything she doesn't have cash to pay for, never carry a balance, and to pay her card off weekly. She called me a few weeks ago to thank me for teaching her about money and budgeting...she said that she would not be able to do what she is doing without that knowledge. She sees what her friends' financial situations are like, and feels pretty grateful for the position she's in now. It made me tear up just hearing that from her. I'm hoping this has helped set her up for success as an adult, at least in the financial sense. I

R101C

I would counter that, from a kids perspective, holding that cash random until you're dead, also sucks. My mom told me something similar the other day. We would get some inheritance some day. Based on her family's female longevity, I'll be in my 70s. Based on my both of my parents' family's male life expectancy, I'll probably be in my last decade. When the men make 75 and the women make 95, consistently, and your moms 24 yrs older than you... All it does is complicate my tax management strategies when I'm at RMD age. She's better off giving it to my nephews. I'll get an unknown amount of money that I'll need to deal with in a fixed window. By then my nest egg already does all the work. I can't budget or save around it. Which means my life is no different. It sucks all the value out of the gift... Other than she feels good about giving us kids money, some day. My parents are a year from Rmd's and are dealing with an inherited ira. It's pushing them up a tax bracket. Had they seen this coming and known the value, they could have planned better. Personally, I prefer my brother's in-laws strategy. They asked the kids if they wanted an inheritance in cash or a lake house. Turns out they are all enjoying the house, it's doubled in value since purchase, and the memories are worth far more than the money. Hell, they've invited me down a few times and I've had a blast with them. I'd rather my parents did that vs leaving me money when I'm 70. Give me all the experiences and memories. My SO is a cancer survivor, but that scary shit never leaves our lives completely. Let's also enjoy today. I'll just remember my folks as frugal to the point of sucking the joy out of life. They will pass on whatever they don't use. Most of my memories are about cheap take out, the par 3 golf course (cuz regular golf is too expensive), and the time my mom was going to make me a cake for my birthday, but it took 4 eggs for that variety, and eggs were expensive, so she swapped it for cookies that only took 2 eggs.

cdude

If I were in your position, I'd liquidate all the individual stocks, leave EJ and put it in a better brokerage and stick with an index fund. Yes, you should spread any pre-tax RMD over 10 years. You still have room in the 24% bracket. Taking the full amount out would mean a lot of the distribution lands in the 32% bracket, paying additional taxes for no reasons. Your Roth RMDs are tax-free so you can just do the entire amount.

Necessary--Weevil

Bro, hes just doing his RMD

Rdw72777

RMD’s aren’t particularly high, even on a 7-8-figure account. They don’t start until age 75, so people have 15 years to schedule withdrawals in a tax planning way before RMD’s. The worry of having too much money in retirement is ridiculous, and you’re vastly overstating the horrors of RMD’s.

KweenieQ

I'm not sure what you're getting at. I do carry different assets in taxable accounts than I do in tax-advantaged accounts. The general term for that is **strategic asset location.** My tax-advantaged assets outweigh my taxable assets by about 3 to 1. Some of the tax-advantaged assets are inherited (they have 9 more years) and came with RMDs. I've set up a MM-based cash buffer so that I should never have to cash anything out prematurely to fund an RMD. If I stick to the standard 10-year schedule for the inherited RMDs, they'll overlap with the RMDs for my own IRA for a couple years. I'm hoping that the taxable account will supplement cash flow (if needed) without the bigger tax bite. If it isn't needed, I'll continue draining the trad IRA first (either thru RMD or charitable donation), leaving what's left, plus a Roth and taxable accounts to my heirs.

Wide-Bet4379

I prefer Roth because it'll give me more freedom. If I want to take out extra one year, I won't care about tax brackets. If I don't want to take any at all, I don't have to care about RMD's.

i_am_viet

You do realize the HSA behaves like a tIRA after age 65? And that it has additional benefits over IRAs? * Not subjected to RMD rules. * Contributions not subjected to FICA. That is another 7.65% in taxes recovered. * No taxation on qualified medical expenses.

Hot_Medicine_476

the employer match is completely non-negotiable -- that's a guaranteed 50-100% return on your contribution and NO taxable account can replicate that. you always capture the full match, full stop. beyond the match is where it gets interesting. the real argument for ALSO building a taxable brokerage isn't that taxable beats a 401k (it usually doesn't). it's about WITHDRAWAL FLEXIBILITY in retirement. if your entire nest egg is in a traditional 401k, every dollar you pull out is ordinary income -- no exceptions. but if you have traditional 401k, roth, and taxable working together, you can blend your withdrawals to stay in a lower bracket. take $40k from taxable at LTCG rates, $30k from Roth tax-free, and only dip into traditional for the rest. suddenly you're managing your effective rate instead of just taking what you're forced to take. the RMD thing is also underrated here. let $2M+ sit in a traditional 401k until 73 and the IRS is going to force distributions whether you need the money or not. stack that on top of Social Security and you could end up in a higher bracket than you were in your working years. that's the scenario where people look back and wish they'd done more Roth or taxable along the way. so the answer isn't "stop contributing to 401k." its "always get the match, then build the other buckets intentionally so you have OPTIONS later." tax rate predictions are a coin flip, but having multiple account types to choose from is ALWAYS valuable regardless of which way rates move.

Potato_Donkey_1

You're getting the benefit of untaxed growth and earnings until you hit RMD age. It's true that we have a national debt burden, two political parties that refuse to confront it realistically, and will probably have something very different in the future in terms of taxes and private wealth. How do you tax plan for global or national systematic collapses? I think the answer is that you invest a little for some extreme contingencies and hope that we will keep muddling through. But in terms of outcomes in the main body of the bell curve, 401k contributions keep making sense.

belovedkid

That tax rates can change.…and that after tax accounts have more net value over 30-50 years of compounding than a deferred account of any type irregardless of taxes. The ONLY time this could be possible is if you plan on taking gigantic chunks out in retirement and depleting the deferred account very quickly. RMDs are not a concern regarding income because you can use QCDs to remove that income from your return. You can also convert portions of the IRA to a Roth in pre-RMD years to reduce RMD requirements. Only the largest IRA balances would need to worry about not being able to offset with QCDs. Those people typically have plenty of wealth and would prefer to spend down their traditional IRAs before anything else anyone and eat the taxes so their heirs don’t have to. Returns are higher in deferred accounts because dividends and interest are not taxed until taken out. If I own an S&P fund and 20ish % of my total return comes from dividends (which is low compared to historical), assuming a 25% Fed/State marginal rate, I’m giving up 5% of my total return annually during working years. Compound that difference over 20-40+ years and it makes a huge difference, especially when you control what comes out of the IRA. This isn’t even considering somebody with a lower risk tolerance who wants higher div/int in their portfolio.

plawwell

If your RMD is $340k then your IRMAA delta is only $2450. It's buttons so stop spreading FUD.

Careful-One5190

Not a nothing burger for many of us. And it doesn't require a "gargantuan" RMD. It absolutely CAN happen for regular people. Maybe not you, though.

mapleflaked

Roth has no RMD rules as compared to normal 401k

plawwell

To hit that amount requires a gargantuan RMD for a particular year. That just doesn't happen for regular people. It's a nothing burger so move on.

wild_b_cat

I think the question is: are you facing that excess RMD because the market did better than your expectations after you retired? Or because you waited too long to retire?

owenmills04

What if your RMD requires you to pull out 200k/year, but the tax brackets at that time step up at 150k and that's all you want/need to take to stay in a lower bracket? And yes your heirs getting a tax bomb isn't ideal This strategy doesn't apply to much of the population that isn't maxing out their tax buckets, and likely won't have high RMDs or a large balance at end of life I never said it did though

MattieShoes

Not parent poster, but yeah, it's kind of a fake problem unless you're worried about inheritances. The withdrawal rates we're talking about are ~4% for people in their 70s and hits ~5% around age 80. Those rates are low. Subsidy cliffs are real, but it's still first world problems. Plus it's not like you can't plan ahead, like Roth conversions before RMD kicks in. And if that ain't enough, then it's because "boo hoo too much money" -- we're back to inheritance crap.

Kindly-Eagle6207

>You're obviously not retired and just aren't familiar with the math and how SS and Medicare work Translation: I'm taking advantage of Healthcare subsidies and social welfare for people significantly poorer than I actually am and I'm incredibly pissed off that I might be forced to pay my fair share decades after I retire. There's no universe where RMDs leave you unable to pay your bills. If you hit a welfare cliff due to income limits you can withdraw more to cover the gap in premium payments for the year. Since RMDs are based on life expectancy and account value one of two things will happen the next year: 1. You have enough money left that you're forced to withdraw over the income cliff again. Or 2. Last year's RMD has dropped your account value low enough that your RMD for this year is under the subsidy limit. Realistically if you're moaning about the "tax trap" of RMDs, it will never be 2. You will always withdraw more money than you need and pay taxes on it rather than getting to hoard it for, at best, a late life inheritance that would be worth significantly less to your kids than helping them out earlier in life.

Jumpy_Childhood7548

If you can get a state and federal deduction for contributing your extra funds into a 401k, or similar plan, that may be more advantageous, especially if you also invest the tax savings, as you save at your combined marginal bracket, during your highest earning years, with tax deferral of gains, till your 70’s, with only a RMD of about 3.7% initially per year then. Even your beneficiaries can defer some taxation.

Careful-One5190

An RMD is not a bonus, and that is not a valid comparison. You're obviously not retired and just aren't familiar with the math and how SS and Medicare work, or you don't have enough in your 401k to make much of a difference anyway. For many of us, it's not a "fake problem" at all. Learn a little.

cliftondon

When people load up the boat in a traditional retirement account, they are stuck with a big clunky battleship with no idea what the water will be like and limited control over when they can set sail. Past the point of free money in an employer match, I fail to see why anyone would shovel any more money into these, though it’s a matter of conviction and security for some. Also, a six-figure RMD is also a good problem to have, but it’s a bad one to have if you don’t want to be taxed on it for any specific reasons in a specific year. All that growth could be taxed much less in a brokerage or not at all in a Roth. And in their own way taxable brokerages are tax deferred - growth can happen over years and decades, you decide when you sell, not the federal government via RMD, and when you do it’s NOT taxed as ordinary income. Roth is a no-brainer if you can do one directly or via backdoor. But some people get inhibited by the complexity when they make too much or don’t qualify for a contributory Roth. Taxable brokerage is so easy and so powerful

Arrowhead_Pride15

Yup. Tax rates are historically low right now and the deficit is sprialing out of control. Social Security and many other entitlement programs are chronically underfunded. They can keep kicking the can, but eventually the math is clear, we either need to spend significantly less, or raise taxes on pretty much everything. I'm not a super high earner ($130k household) and if I only contributed to a traditional 401k my entire life is probably retire with $1.5-2.5M in the 401k, and to your point any RMD's or Roth Conversions would likely keep me at or above the bracket that I am in now. I prefer to have a near even blend of Roth, taxable, and pre-tax personally as I have no idea what rates are gonna be in 20-30 years and no idea what social security, IRMAA, homestead exemption etc will be by then.

RiskBeforeReturn

You’re really asking a tax timing question, not a product question. At a high level: You have three levers: \-contribute pre-tax vs Roth \-convert later vs now \-control which bracket you “fill” over time The key constraint isn’t the current 22% vs future 12% in isolation — it’s the \*lifetime tax path\*, including: \-RMD pressure later \-IRMAA thresholds \-how much flexibility you preserve in low-income years A few observations: 1) Contributing to Roth at 22% while expecting 12% later is usually a negative spread You’re prepaying tax at a higher rate than necessary. 2) Your “gap years” are extremely valuable That’s when you have control to do conversions at 0–12% brackets. Once RMDs start, that control disappears. 3) Pulling from the 457b now to fund Roth contributions is effectively accelerating taxable income at 22% That only makes sense if it prevents a worse outcome later (e.g. very large RMDs pushing you into higher brackets/IRMAA). 4) The real risk in your setup isn’t underfunding Roth It’s over-accumulating in pre-tax and losing flexibility later. So the decision framework becomes: \-Use current years —> avoid overpaying tax (be cautious with Roth at 22%) \-Use gap years —> aggressively optimize conversions in lower brackets \-Model RMD impact —> if it forces you into 22–24% anyway, earlier partial conversion can make sense At this level of complexity, a one-time tax projection (multi-year, not single-year) is worth it. Not for advice — just to map the tax path clearly.

zbern

I've looked at RMD but I just don't get it when it comes to monitoring sleep. TMO is solid but I tend to shy away from large/mega caps. When it comes to WLDN - they are sitting on a massive $1B backlog which is basically their entire market cap. They’ve beaten earnings on the last four calls, and their data center revenue is expected to double.

ptexpat

Been following WLDN. I also feel their valuation is in a decent place right now, but keep wondering why enter a bit of a "complicated situation" name. One healthcare I recently entered RMD and TMO.

fallingdowndizzyvr

> What would you tell your 40‑year‑old self? Roth conversions. Start them early. Since that 1M just keeps growing and then you are staring at some pretty epic tax bills once RMD hit.

aaron_dresden

If you’re liquidating your porfolio anyway in retirement as a retiree then what’s your point? If it’s a downturn and you have RMD’s then that’s sometime to just account for. But I will also point out that if you purchased over 40 years, a 20% drop does take you back that far in the world of equities. The real risk is only early in retirement with sequence of returns risk, you factor that in when you go this route and you choose how much risk you want to take on beyond this in terms of expenses with the size of your buffer. Not having $50k means you don’t really have the proper cash buffer. It’s a minimum of 1 year of expenses but you can go up to 3. Diversifying helps to reduce your risk against these kind of drops. It’s less likely to get a truely global downturn then it is a downturn in one market, just as a downturn hits certain sectors more than others. You choose your risk by composition of your portfolio. You also don’t need to pay for all costs up front. There are also options to cushion sizeable expenses like if you have a home with say a reverse mortgage if you need too. I didn’t say this was a risk off strategy, or that it’s set and forget. It just sounds like this strategy isn’t for you which is fine. Also if you feel put out by writing, you…don’t have to?

nop--sled

Smart move!!!! We have been doing Roth Conversions for a while, but somehow when the market is crashing and life going on, I never think about a Roth. We are both of RMD age so aren't doing Roths anymore, but in a big crash it should be worthwhile. I find the comments funny as you know you can have the exact same investments in the Roth as you did before the Roth. You would just hope the markets don't recover during the time it takes to complete the conversion.

Nev-Ret-Dude

I only keep 3 years of cash for RMD withdrawals in case the market goes south. Paid off house and could live off of Social Security (US) if I had to. Target date fund has a lot of cash if it is the same as your current retirement plan. My guess is you have more than 50% in cash/bonds. You have a very conservative investment strategy. I would suggest that you are under invested in stocks by at least 50%. I’d move the Target Date Fund into the index funds to start. Then have no more than 3 years in cash/bonds. If this is too risky for you, then reduce your cash and ladder your bonds.

Nev-Ret-Dude

Once a year when I start to plan on when I will take the RMD. I only keep 2 years of cash equivalent.

Nicole_FreeWill

The question of whether to use the nondeductible traditional IRA actually has a planned giving angle people don't think about early enough. Once you're in RMD territory, that pre-tax IRA becomes a source for QCDs, qualified charitable distributions that satisfy your RMD without hitting income. If you're stacking nondeductible basis in there now, it complicates things later when QCDs are otherwise a clean move. Most development teams see this when donors start asking about how to structure IRA gifts, whether to do a QCD now, name the charity as beneficiary, or contribute through a bequest. The basis tracking issue you're describing is exactly what makes beneficiary designation the simpler path for a lot of people. I work at FreeWill, a planned giving software company

ziggy-tiggy-bagel

I am currently 50% in the market and 50% in money market. First time I have held so much more cash then just my cash reserve for emergencies. We are fortunate to have enough income from pensions and Social Security, that we won't have to touch our investments until RMD'S kick in in a few years. I just don't understand or trust this market.

bambam1957

Of course I had to take my RMD last week at its low point

ziggy-tiggy-bagel

It depends on the your time frame. If you have years before retirement, you want the market to go down when you DCA into the market. Everything is cheaper. Now if are 6 years into retirement, like we are, then that is the reason to have a few years of cash reserve sitting in money market or a HYSA, so you don't have to sell into a down market. RMD'S are a whole other problem in a down market.

redflagdan52

Already do. But you see Uncle Sam has this thing called RMD....

ThanklessWaterHeater

I’m already very long on SYK, RMD and DXCM. ADBE has fallen so far it’s now on my watchlist. I’ve never seen the appeal of MSFT, and still don’t. But I invest in stability. And at the moment the world is more unstable than it has ever been in my lifetime. I’ve done some judicious trimming, and have a decent amount set aside for when I feel comfortable buying again. But I’m not buying anything right now.

bobdevnul

A traditional 401K will reduce your taxes now. You will pay the tax later when you withdraw from it as fully taxable. You don't get a choice about withdrawing from the 401K balance. There are Required Minimum Distributions (RMD) that currently start at age 73. The RMD start age is scheduled to go up in coming years. There is also no step up basis for inherited 401Ks. It is all fully taxable whether you are alive or dead. I can say with certainty that the forced RMDs are painful for taxable distributions of money I don't currently even need. The RMDs bumped me up into the next tax bracket. With a traditional 401K you will be subject to unknowable changes in tax rates well into the future. With a Roth IRA or 401K you pay taxes on the money yearly before it goes into the account and there are no taxes at all on withdrawals of gains at the allowed age. By the current law that is a sure thing that you can count on. But don't forget that some years ago they changed the taxability of Social Security so that up to 85% of it is taxable as ordinary income because they think you make too much. Never underestimate the ability and willingness of the government to screw you. We have a huge, unprecedented national debt. At some point they will have to do something about it. With the unknowability of future tax rates there is no way to calculate with certainty which is better. I would and did hedge my bet and did some of each. Withdrawing a $200K lump sum from a trad 401K may not be the wisest way to do it for taxes. That $200K will all be taxable as ordinary income in the year that you take the distribution. That will be a huge tax bill, especially if it bumps you into the next tax bracket.

Denverplayer

"it's a no brainer" . You're completely ignoring the effects of RMDs and IRMAA. It comes down to how much you'll have in a traditional 401k (plus other taxable income) when RMD's kick in.

wild_b_cat

Ok, but what does that have to do with RMDs? Like imagine the RMD rule went away. What would your approach be?

rickochetl

I didn’t forget that at all, actually. I explain it in terms of the compound growth formula here: https://www.reddit.com/r/investing/s/eM44h3yWQU Basically, in a taxable account, dividends/distributions are taxed yearly and that crimps your growth rate. Capital gains is a second tax on money you’ve earned and grown (vs Roth which is only taxed once every). That crimps your growth rate further in a “not nice mathematically” way, but it’s also fine to ignore because the growth rate reduction is more important. IRA withdrawal tax is a one-time multiplier vs the yearly multiplier of annual growth rate. I’d rather have a higher growth rate. Also RMD is a limit to duration. I’d rather have unlimited duration. Roth maximizes growth rate and duration. Traditional maximizes principal (and not by a lot).

rickochetl

This is terrible financial advice. Yes, you pay more upfront and it appears that your "assets pot" is smaller, however, the *buying power* of that pot in retirement turns out to be significantly greater, because every dollar in Roth is actually worth a dollar. In a traditional IRA, your buying power is significantly reduced by taxes on withdrawal, plus required minimum distributions (RMD) which forces you to withdraw and pay taxes. These RMDs and taxes are significant if your strategy is to "maximize". In most cases, Roth gives you more buying power in the long run, plus has extra advantages with no RMD after you retire, so your investments can continue growing tax-free as long as you live. And then more extra advantages beyond your death where your investments can continue to grow tax-free for your heirs. The way you should be thinking about the taxes on Roth contributions is that it's allowing you to put more of your "pretax" earnings into a shelter where it will never be taxes again.

legman1982

At your income level a traditional 401K is probably the best move. Some money in a Roth is fantastic, but I believe your top dollar is in the 22% bracket. For simplicity in 20 years: $25k becomes $100K with taxes due $20K Roth becomes $80K. Tax Free. The kicker is the $5K you paid in taxes in your example becomes $20K. So you have a $120K traditional vs $80K Roth So your marginal tax rate would have to be at 33.33% to brake even. I know IRMA, RMD and value of a dollar in 20 years play into this. This is why we diversify.

garylapointe

That would’ve helped today you, but not necessarily future you. Hint: someday you’re gonna grow up and be future you ;) If I could go back and do it all again, I would do most of my traditional contributions as Roth contributions. When you’re possibly being forced to pay extra for your Medicare in the future and also having to take RMD‘s you might regret taking that savings now (the extra income from the RMD’s can also trigger the increase cost in Medicare). Google IRMAA to find out more about those increased medical costs.

Hairy-Barracuda1865

I have several. I’ve only been consolidating them (1) into the account I actively manage myself and (2) to facilitate administration of the RMD when I turn 72

Heyhayheigh

Yikes. I don’t like mom and pops. Not enough safeguards normally. I would speak with Fidelity or Vanguard. I doubt they are adding anything to investments. They are likely overpaying anyways for just RMD and treading water. If this is a meme ver of their community you’re likely stuck until the transition of assets.

cdude

Retirement accounts are not mutually exclusive. 401ks have a much bigger contribution limit than IRAs. There are specific reasons why someone would want to max their Roth IRA first, primarily people in lower tax brackets, but otherwise it's better to prioritize 401ks first. Ultimately you want to max all your retirement accounts. A brokerage account is more practical to give to your children while you're still alive, but they do not benefit from tax savings. There are step-up basis and RMD that you need to understand before deciding what works best for you. My advice is that if you haven't met your own retirement goal, focus on that first before thinking about saving for your children. They can borrow money, you can't.

Nervous-Scholar-6684

I was eligible at 66 delayed for two years and collected at 68 years old! I think it was a good compromise, not reaching into my IRA. I did burn through my cash though however we also traveled a lot. The nice thing is now I really don't have a need to dip into my IRA still because of the extra cash only if I feel like splurging. Of course this year I start my first RMD. I think this is when you wish you had withdrawn more so you didn't have to pay so many taxes against your will!

Puzzleheaded-Net-273

70 is the last possible "sensible" year to take SS. There is no longer a benefit past 70 since you receive no more for waiting past this age. 73 is the year RMD's begin if born between 1/1/1951 and 12/31/59. RMD's begin at 72 if born before 1950. They begin at age 75 if born in 1960 or later.

ziggy-tiggy-bagel

I took mine at 64 when my unemployed ran out. I won't have to touch my investments until I am forced to take RMD'S. Letting your investments grow isn't taken into the breakeven number.

flux8

You mean you’re tired of the marketing. AI is just in its infancy. It’s able to now improve upon itself. I used AI in December to help strategize some financial moves. It helped me project out 30+ years and may potentially save me millions in forced RMD taxes. I’m thinking it might able to handle filing my tax returns too. Haven’t done this yet but I’d bet it can do any legal documents too such as will and testament, durable power of attorney, etc, etc. TLDR; the AI revolution is just starting.

PHL1365

Seems like a reasonable plan if the numbers work out for you. Never thought about borrowing against a brokerage account. Seems kind of risky if the market performs poorly. Just note that you won't need to start RMD's until age 75 if you were born after 1960. As for the other considerations: 1. I misspoke. My money (>90%) is mostly in a rollover IRA, which I can start pulling from in \~20 months without penalty. 2. If I expatfire, no need for ACA. Will either get an international plan or self-insure 3. Part of my rationale for saving the inheritance money is so that I can utilize some of these tax strategies over time. Never really occurred to utilize debt as part of that strategy, but might be useful

PHL1365

It occurs to me that another option would be to follow the traditional path of spending cash first, and then putting excess RMD money into the brokerage account. This seems like it would be best if I live longer, but not so good if I die before \~80

toxichaste12

RMD - ResMed average 30% growth per year for 10 years plus a small dividend. And almost all of my biotech and medical stocks save the big names and never mentioned here. No one here discusses biotech and medical devices but those are recession proof.

Clueless5001

Correct. If all goes well I hope not to withdraw from anything until SO is 75 so in about 10 years and then only a mandatory RMD. SO is still working and likes what he does and would go nuts sitting home (as would I if he was sitting home!) One of his friends is 83 in the same job and refuses to retire, another is 73 and still likes it. The point is that I CAN take it tomorrow without any additional penalties if I choose to. Often when people respond to someone retiring at say 40, they have to worry about being able to access their retirement funds, and that gets part of the focus of the question, that is not an issue here. Although we are older, we are still in the accumulation phase rather than the capital preservation living on dividends phase. However, because we are older, I worry about risk more than I would have if I was 35 and had many years to weather a correction

stickman07738

Life is good. The biggest concern was healthcare and not knowing what will happen with costs. I have enough "cash" that I will not do any RMD until I am 72. It is just controlling the wind down. Tomorrow I head to Florida for 2+ weeks to enjoy spring training totally stress free.

razorgatortt

At 32, VTI all the way. One thing to consider with 403b are taxes with RMD. Are you contributing to a Roth as well? Also consider is slowly rolling over your 403b into your Roth when you’re 59.5. Again, those pesky taxes

Downtown-Pace3824

I have to withdraw from the IRA. BDA, RMD.

Downtown-Pace3824

Yes, I could increase the annual or bi-annual RMD withdrawals to pay down the mortgage quicker, without taking the big tax hit of withdrawing it all at once.

LeftoftheDial1970

"I have an IRA that requires RMD withdrawals with about five more years left before it has to be fully depleted." So you've been drawing down your IRA in addition to your RMD's? Given that RMD's start at age 72, the question begs why someone would still have a mortgage at that age? Everyone's situation is different, but if you haven't paid off the mortgage and you're 72 or older, then I would just keep on paying the mortgage and save the money for other purposes.

nostatic1

Yes, that's my dilemma: There's not a clear cut answer here. Typically, I don't mind a reasonable amount of debt if I can earn more on someone else's money. When the market is robust and interest rates are low, debt is a useful tool, albeit with risk. But now, with the bull party looking like it may soon lose steam, taking some cash out to reduce debt (my mortgage) might be the smart play. Regardless, in five more years, I'll need to meet the RMD deadline, so why not put that money to use now.

Alternative-Grand-77

[https://cnevpost.com/2026/01/07/byd-to-add-long-range-variants-4-hybrid-models/](https://cnevpost.com/2026/01/07/byd-to-add-long-range-variants-4-hybrid-models/) for the range part. 100000 RMD is 14000 USD

Ok_Assignment4100

I don't think I can contribute to a 401k while unemployed since it's usually a company/firm sponsored retirement plan. Pre-tax money (In this case for regular 401k) means you're deferring to pay taxes now and will eventually pay it at or after retirement age. But, you'll be forced to take money out at 72/73 via RMD or face penalties.

bobdevnul

Haha yeah, after I took my RMD last year I made more than the RMD. The RMD was free.

Various_Couple_764

You are not really talking about rebalancing. You are talking about tax management. You should consider moving 401k money to a Rollover IRA and then moving that over to Roth account to avoid future RMD. If you have to do RMD now you should invest what is left into low tax investments such as munificple bond funds or invest in funds the generate constructive ROC dividends. The is probably more you can do but with the information you provided I don't know what that would be.

therealjerseytom

If you're talking about RMD's you must be referencing a tax-advantaged account...? In which case you can rebalance however you like, makes no difference. If you're talking about stepped-up cost basis though that'd mean a taxable account... but then no RMD. > My original plan was to die My man, that's not a good plan.

SourDieselDoughnut

With your compounding question you also have to ask yourself, will taxes be the same rates when I retire as they are currently? At first glance, trad 401k will compound better due to higher principal. But you also have to consider RMD's and when you'll need the money. Roth has a feasibly longer time to compound due to never having to be withdrawn.

big_deal

Yes, I saw in another comment that you expect your income needs to be lower in retirement so it makes sense to defer taxes so you can pay a lower rate in retirement. RMD's and taxes on inheritance are secondary factors that you can try to manage/reduce by drawing down tax deferred accounts later when you are paying lower taxes.

big_deal

I don't see how it would possibly be beneficial to you unless you have saved much more than you need for retirement and are planning to have even higher income in retirement than you are currently earning. You will end up paying your top marginal tax rate for every dollar you put into Roth 401k, versus paying your average tax rate for every dollar you remove from standard 401k. And you will very likely be in lower income range and have even lower average tax rate in retirement than today. In retirement you can withdraw more than you need to fill your tax bracket and reduce future RMD's and their tax rate, move it to a taxable account where the cost basis will be reset upon inheritance.