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Financial Planning Corner: A Change To RMD’s For Post-49’ers

Written by Danny Ratliff | Jan 4, 2020

Happy New Year from RIA Advisors Planning Corner! As we wind down the holiday season our focus begins to shift back toward wealth and health.

This financial industry and retirees have been trying to figure out what the passage of the SECURE ACT means to them. We’ve spent some time on this over the last couple of weeks, but we keep getting one really important question from readers over the holidays.

, Financial Planning Corner: A Change To RMD’s For Post-49’ers

When do I have to take my Required Minimum Distribution aka RMD from my tax deferred retirement account?

We’ll break this down for you by date of birth.

You were born before 1949…

Business as usual if you are already taking RMD’s. The SECURE ACT does not impact you. Continue to take your RMD’s as scheduled.

If you were born between January 1st and June 30, 1949…

Again, business as usual. Since you turned 70 ½ in 2019 hopefully you have already taken your RMD. However, if you didn’t make your distribution in 2019 you’re in luck. You can still take your 2019 distribution as long as you do so prior to April 1, 2020. Remember you will still be on the hook for your 2020 RMD as well as last year’s 2019.

You were born between July 1st and December 31st, 1949…

Winner, winner chicken dinner! The SECURE ACT does affect you. Your first RMD is now 72 instead of 70 ½.

, Financial Planning Corner: A Change To RMD’s For Post-49’ers

You were born after 1949…

Ding, ding, ding you won the SECURE ACT. Your first RMD doesn’t happen until you’re 72.

RMD’s aren’t to be taken lightly. If you neglect to make your distributions Uncle Sam will penalize you to the tune of 50% of the amount not withdrawn.

I’m sure in the coming weeks we’ll continue to discuss the implications of the SECURE ACT as we receive more questions.  The bill certainly accelerates the need for funds outside of Traditional IRA’s and retirement accounts since the Stretch IRA is all but dead. For more information on the SECURE ACT go to www.realinvestmentadvice.com and type in SECURE ACT in the search bar for previously written articles.


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Danny Ratliff, CFP®, ChFC® is the Senior Financial Advisor and Planner for Clarity Financial. He is also a contributing wrtier to the “Real Investment Advice” website. Feel free to EMAIL Danny with any questions or comments.
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