Preparing for required minimum distributions (RMDs) can be quite unsettling when you know withdrawals are coming and the IRS will be waiting. In this episode of the Money Wisdom podcast, we’re going to answer a question about what you can do from a planning standpoint when large RMDs are coming in retirement.  

This situation highlights a common issue: retirees often find themselves in higher tax brackets due to large mandatory withdrawals, reducing their financial flexibility. So what are the strategies you can utilize to manage your tax requirements?

Here are some of the strategies Jake Doser, CFP®, CPWA® and Nicholas J. Colantuono, CFP® discuss in this episode:

Consider Roth Conversions – Moving funds from a traditional IRA or 401(k) to a Roth IRA allows retirees to pay taxes on their contributions now, instead of later. Since Roth IRAs do not have RMDs, this strategy helps reduce future tax burdens while allowing tax-free growth and withdrawals.

Diversify Income Sources – A well-balanced portfolio includes taxable, tax-deferred, and tax-free accounts. By diversifying where retirement income comes from, retirees can strategically withdraw funds to minimize overall tax liabilities.

Utilize Qualified Charitable Distributions (QCDs) – For those who are charitably inclined, donating directly from an IRA to a qualified charity can satisfy RMD requirements while reducing taxable income.

Time Withdrawals Strategically – Planning when and how much to withdraw in the years leading up to RMD age can help smooth out tax obligations and avoid large tax spikes.

RMD management is just one piece of the broader retirement planning puzzle. By implementing smart tax strategies, retirees can keep more of their hard-earned money and enjoy financial security. Remember that retirement is not just about saving—it’s about strategically managing those savings for long-term stability.

If you’re approaching retirement or already facing RMDs, now is the time to explore your options. Seeking professional financial advice can help you develop a personalized plan that aligns with your financial goals and minimizes unnecessary tax burdens.

Here’s what we discuss in this episode:

0:00 – Today’s question

1:05 – What to know about RMDs

4:13 – Income planning

8:49 – Tax planning

Join us for our next financial workshop to learn about these strategies and more. Text WORKSHOP to 800-757-0436 to reserve your spot today.