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The Downside of Delaying RMDs

It took more than four decades for congress to raise the age for required minimum distributions in 2019 from 70½ to 72. Less than two years later, Congress is considering raising it again.

The Setting Every Community Up for Retirement Enhancement Act of 2019 had bipartisan support, and experts believe that Congress's encore, the Securing a Strong Retirement Act -- already approved by the House Ways and Means Committee -- has a good chance of becoming law. Dubbed the SECURE Act 2.0, the bill aims to make it easier for Americans to save for retirement by raising the RMD age to 73 on Jan. 1, 2022; to 74 on Jan. 1, 2029; and then to 75 on Jan. 1, 2032.

Having three more years of tax-deferred growth in your retirement savings accounts, however, is a mixed bag. "Everyone likes when you delay RMDs," says Ed Slott, president of Ed Slott and Co., which provides IRA training to financial advisers. "But waiving RMDs or putting them off doesn't help most people."

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