The ‘mysterious’ world of the RMD


Over time, your Thrift Savings Plan (hopefully) gets bigger. And while that’s really good it can also present some minor problems when you must, by law, start reducing it in the form of a Required Minimum Distribution.

The RMD is the amount of money that must be withdrawn (taken) from most tax-deferred retirement plans annually once the account holder reaches age 70.5. That RMD is taxable — the price you pay (to the government) for being able to put it into your TSP (or similar vehicle) on a pre-tax basis.

So how much will you be required to take each year once you hit the big 7-0? Should you rollover the RMD? And should you take the payments all in one lump sum, or in monthly installments? Short answer, it depends. So how can you find out what’s required of you, and what’s best for you?

Listen to today’s Your Turn radio show. The show runs from 10 a.m. to 11 a.m. EDT.  Benefits expert John Grobe will be the guest and he’ll talk about the sometimes mysterious, frustrating world of the RMD, and other features of the TSP and why it’s an important part in your retirement plan. You can listen live  at FederalNewsRadio.com or on 1500 AM in the Washington metro area. You can also dial 712-432-5393 during the show to listen from any phone. Remember all shows are archived on Federal News Radio so you can listen to them at your convenience.

 

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Your Turn with Mike Causey

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