If you’ve ever heard the term “RMD” tossed around and nodded like you knew what it meant - don’t worry, you’re in good company. Required Minimum Distributions are one of the most common sources of confusion in retirement planning. The rules keep changing (thanks to the SECURE Act 2.0 and the One Big Beautiful Bill Act), and even the most financially savvy people wonder when they actually have to start taking money out and how much.
Let’s break down what’s new, what’s stayed the same, and what it means for your retirement plan.
What’s an RMD, exactly?
An RMD - or Required Minimum Distribution - is the minimum amount you must withdraw from certain retirement accounts each year once you reach a specific age.
The reason: while you’ve been saving and growing that money tax-deferred, the IRS eventually wants its share.
RMDs apply to:
- Traditional IRAs
- SEP and SIMPLE IRAs
- 401(k)s, 403(b)s, and similar employer plans
They don’t apply to Roth IRAs during your lifetime, but they do apply to inherited Roth IRAs or certain employer Roth accounts (though the rules there have just changed).
RMD Age: The Latest Updates
The SECURE Act 2.0, passed in late 2022, brought several key updates to RMDs - mostly in your favor.
- The starting age for RMDs increased from 72 to 73 in 2023.
- Starting in 2033, the RMD age rises to 75 for those born in 1960 or later.
- Your first RMD must be taken by April 1 of the year after you reach the applicable age, and every December 31 after that.
- Thanks to SECURE Act 2.0, the penalty for missing an RMD is now 25% (down from a brutal 50%), and it can be reduced to 10% if you correct the mistake within two years. This makes it easier to recover from simple errors but doesn’t remove the need for careful planning.
How the OBBBA (One Big Beautiful Bill Act) Affects RMDs
The OBBBA, signed in 2025, made broad tax and retirement updates - but it didn’t rewrite RMD rules. Here’s what matters for retirement planning:
- The RMD age stays the same: The OBBBA keeps the age 73 → 75 timeline from SECURE 2.0.
- A possible look at Roth IRAs in the future: The law directs the Treasury Department to study whether very large retirement accounts (especially Roths) should eventually have RMDs. That’s not law yet, but it’s something to keep an eye on.
- New tax perks for older adults: The OBBBA introduced an extra deduction for taxpayers age 65 and up ($6,000 for singles, $12,000 for couples, for 2025–2028). That could help offset RMD-related income taxes for retirees.
What this Means for You (and Your Parents)
If you’re in your 40s or 50s and helping aging parents manage their finances, these changes matter for both generations.
For your parents:
- Confirm their RMD start age. If they turned 72 in 2023 or later, their first RMD is due the year they turn 73.
- Ask if they have Roth 401(k) balances - those no longer require RMDs.
- Make sure their beneficiaries are up to date - especially if family circumstances have changed.
- Schedule RMD withdrawals early in the year to avoid last-minute stress.
For you:
- Know your future RMD timeline (it’ll likely start at 75 for your generation).
- Consider Roth conversions now while you’re still working. (Since Roths aren’t subject to lifetime RMDs, you could reduce future tax headaches.)
- Keep RMDs in mind for tax planning and charitable giving. Some retirees use Qualified Charitable Distributions (QCDs) to satisfy RMDs while reducing taxable income.
The Bottom Line
The new RMD rules give you more flexibility, but also more reason to plan ahead. Understanding when distributions start, which accounts they affect, and how to handle them tax-efficiently can make a big difference over time.
Whether you’re helping your parents stay organized or looking ahead to your own retirement, a little clarity now can save a lot of stress later. Charpentier Wealth Strategies can help you map out when to take distributions, how to minimize taxes, and how to coordinate withdrawals with your broader goals so your retirement savings work for you, not against you. CLICK HERE to make an appointment.