Will RMD's Cause You To Run Out of Money Quicker? LFG Daily - October 14, 2025

Colin Symons, CIO Lloyd Financial Group

NFIB Small Business Optimism fell to 98.8 vs. exp. 100.5. That’s the first drop in three months, amidst supply chain and inflation worries.

China stood by rare earth and shipping restrictions, causing more consternation in the market. This still looks like negotiation tactics, to me. They still need us to buy their stuff, at least while their domestic economy needs so much support.

Japanese political negotiations are dragging on, helping send the Nikkei down over -3%.

The House GOP is holding a conference call today at 11:30. Could there be shutdown movement?

France is supposed to come out with a budget proposal, today, aimed at cutting costs.

Fed Chair Powell will be speaking today. Earnings season also kicks off. So far, earnings are more good than bad, but nothing overly dramatic.

What does it all mean? Nervous markets are taking back some of yesterday’s gains, as trade tensions remain. At the end, China still needs us to support their weak domestic economy, and we still need them to buy US assets to keep the wealth effect going. A resolution is very likely.

Luke Lloyd, CEO Lloyd Financial Group

Required Minimum Distributions (RMDs): The Hidden Impact on Retirement and Estate Planning

When most people think about retirement, they focus on saving. But once you enter retirement, the conversation shifts to spending—specifically, how and when you’re required to take money out of your tax-deferred accounts. That’s where Required Minimum Distributions (RMDs) come into play, and if you’re not strategic, they can have a lasting impact on both your retirement income and your estate plan.

What Are RMDs?

RMDs are the minimum amounts you must withdraw each year from your traditional IRA, 401(k), or other tax-deferred retirement accounts once you reach a certain age.

• As of now, the RMD age is 73, and it will gradually increase to 75 in the coming years under the SECURE 2.0 Act.

• The IRS determines your RMD amount based on your account balance and life expectancy.

The key idea: the government allowed you to defer taxes on your savings for decades—now it’s time to collect.

The Tax Ripple Effect

RMDs can quickly push retirees into higher tax brackets. Many retirees are surprised to find that they don’t need the full RMD amount for living expenses, yet they’re still forced to withdraw and pay taxes on it.

This has several knock-on effects:

• Higher Medicare premiums (IRMAA surcharges)

• Increased taxation of Social Security benefits

• Reduced eligibility for certain tax credits or deductions

  
  

If you don’t plan for RMDs early, you may find yourself paying more in taxes than necessary during retirement.

Estate Planning Implications

RMDs don’t just affect your retirement—they can also affect your heirs.

When you pass away, your beneficiaries typically must empty your retirement account within 10 years (thanks to the SECURE Act). That means your children or heirs could be forced to take large, taxable withdrawals during their peak earning years, potentially at much higher tax rates.

Without proper planning, your hard-earned retirement savings could become an unexpected tax burden for your family.

Strategies to Minimize the Impact

Here are a few ways to take control before RMDs control you:

1. Roth Conversions

   • Convert portions of your traditional IRA to a Roth IRA before RMD age.

   • Pay taxes now at potentially lower rates, and your Roth IRA will grow tax-free—with no future RMDs.

     
     

2. Qualified Charitable Distributions (QCDs)

   • If you’re charitably inclined, you can donate up to $100,000 per year directly from your IRA once you’re 70½.

   • The distribution counts toward your RMD but isn’t included in taxable income.

     
     

3. Strategic Withdrawals Before 73

   • Taking controlled withdrawals in your 60s—especially during low-income years—can reduce future RMDs and smooth out your tax liability.

     
     

4. Trust and Beneficiary Planning

   • Ensure your beneficiary designations align with your estate goals.

   • In some cases, using trusts can help control distributions to heirs and preserve assets over generations.

     
     

Integrating RMDs Into Your Financial Plan

RMDs shouldn’t be an afterthought—they should be integrated into your overall retirement income strategy. A well-structured financial plan takes into account:

• How RMDs interact with Social Security timing, pensions, and taxable investments

• The impact on your tax brackets throughout retirement

• How to leave a more tax-efficient legacy for your family

  
  

Bottom Line

RMDs are a reminder that every financial decision has a domino effect—from how you withdraw funds in retirement to what your heirs will inherit after you’re gone.

At Lloyd Financial Group, we help clients build comprehensive retirement and estate strategies that minimize taxes, maximize income, and ensure your wealth transitions smoothly to the next generation.

Because the goal isn’t just to retire comfortably—it’s to make sure your money works efficiently for you and your family, today and tomorrow.

Don’t leave your financial future up to chance. Let’s build a plan that gives you confidence today and peace of mind for tomorrow. Click here to schedule a meeting — I’m here to help you take the next step toward financial freedom.

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