Joe Anderson, CFP® explains that your required beginning date (RBD) for taking RMDs is on April 1st the year after you turn 70 1/2. Stay tuned to find out some exceptions for taking required minimum distributions.
“Joe Anderson, CERTIFIED FINANCIAL PLANNER™ here and President of Pure Financial Advisors, and this is your Question of the Week. This week’s question is this: What is my required beginning date?
Your required beginning date is this: everyone has to take a required minimum distribution out of their retirement account once you turn 70 1/2. The required beginning date, or RBD, is April 1st the year following you turning 70 1/2, so there’s some confusion there. So April 1st the following year after you turn 70 1/2 is your required beginning date. If you use that date, however, you do have to take two required minimum distributions. You have to plan this out–you have to look at your income from both years to figure out what is the best strategy for you.
Secondly, if you are still working and you are an active participant in your employer’s plan, such as this–you’re 75 years old and still working and still an active participant in your employer’s 401(k) plan–you do not have to take a required minimum distribution out of that plan. Your required beginning date would start April 1st the year after you retire. So if you’re still working and you’re in your 70’s or 80’s, you do not need to take a required distribution from that plan until April 1st the year after you retire.
However, if you do have other plans, if you have old IRAs or maybe old 401(k)s that you’re not an active participant in, you will have to take a required distribution out of those plans. Here’s a quick solution: just roll those plans into your current 401(k) plan–that would eliminate all required minimum distributions.
Joe Anderson here, CERTIFIED FINANCIAL PLANNER™, and that was your Question of the Week.”