“I Was Really Hoping Not to Have to Work That Long.” A Late-Start Saver Confronts the Age 73 RMD Reality on The Ramsey Show
Key takeaways
- I mean, I don t know if I m supposed to be, you know, I know you re supposed to do something with it at 73 years old, but I was really hoping not to have to work that long."
- The first is real: a 401(k) balance of $2,400 leaves her far short of a retirement plan.
- The caller s instinct that something happens at 73 is correct.
I mean, I don t know if I m supposed to be, you know, I know you re supposed to do something with it at 73 years old, but I was really hoping not to have to work that long."
She had wrapped two anxieties into one sentence. The first is real: a 401(k) balance of $2,400 leaves her far short of a retirement plan. The second is a misunderstanding that steers people into bad decisions: the idea that age 73 is a deadline you must work toward. It is not. Acting on that belief can lead you to delay affordable retirement or panic-save in tax-inefficient ways.
The caller s instinct that something happens at 73 is correct. What happens is a Required Minimum Distribution. Under SECURE Act 2.0, traditional 401(k) and IRA holders must begin withdrawing money at age 73. Ramsey co-host Dave Ramsey said: "at 73… all of your 401k traditional, you re going to have to begin to withdraw at 73 under the RMD rules whether you want to, whether you want to or not."