These are smart moves for required withdrawals in retirement when you don't need the money

As year-end approaches, some older Americans must soon take required withdrawals from retirement accounts — and there are several options if you don’t need the money, experts say.

As year-end approaches, some older Americans must soon take required withdrawals from retirement accounts — and there are several options if you don’t need the money, experts say.

Most retirees must take required minimum distributions, or RMDs, from pretax retirement accounts starting at age 73 or face an IRS penalty. The first deadline is April 1 of the year after turning 73, and Dec. 31 is the due date for future years.

But some retirees have “a lot of guaranteed income” before RMDs, or spend less than they have coming in, according to Judy Brown, a certified financial planner who works at C&H Group in the Washington, D.C. and Baltimore area.

In 2024, Social Security was the most common source of retirement income. But 81% of retirees had one or more types of private income, such as pensions, investments, rental income or employment, according to a Federal Reserve report published in May.

When retirees have more than they need, there could be decisions about how to spend or reinvest their RMDs, experts say.