Many Vanguard clients in their 70s and above missed required minimum distributions from retirement accounts in 2024, risking tax penalties of 10% to 25% of the amount. Vanguard suggests automating withdrawals and consolidating accounts to avoid missed RMDs. In 2024, 585,000 clients failed to take RMDs, with an average potential tax penalty of $1,160 to $2,900. Investors with smaller balances are more likely to miss RMD deadlines. Those with over $1 million faced average penalties of $8,792. Vanguard noted that those who miss distributions are more likely to miss them in following years. The firm recommended automating distributions and consolidating retirement accounts to prevent missed RMDs.

Read more at Yahoo Finance.: Vanguard says millions of elderly retirees are making a critical mistake that leads to tax penalties