Retirees advised to reinvest RMDs for long-term growth and financial security.

From Yahoo Finance: 2025-04-19 06:37:00

Retirees with tax-deferred retirement accounts must take required minimum distributions (RMDs) by a certain age. If you don’t need the money immediately, consider reinvesting it elsewhere. Failure to take RMDs can result in a 25% penalty, but you can make it up within two years with a reduced 10% penalty.

RMDs can be used to buy annuities for a steady income, reinvested in stocks, bonds, or real estate, or allocated for charitable donations, medical expenses, or debt repayment. Make choices based on your needs and goals. Consider maximizing Social Security benefits for an additional boost in retirement income.

Invest RMD withdrawals wisely to make the most of your retirement funds. There’s no one-size-fits-all approach to taking RMDs, so explore different investment options to suit your financial goals and lifestyle preferences. Remember to comply with IRS regulations to avoid penalties and ensure a secure retirement.



Read more at Yahoo Finance: Reinvesting Your RMD as a Retiree? Here’s What You Need to Know