RMD Timing & Social Security Coordination: What Retirees Should Know in November

As November rolls around, many retirees are beginning to think about year-end financial moves—especially when it comes to Required Minimum Distributions (RMDs) and Social Security benefits. For those navigating retirement accounts, understanding how RMD timing interacts with Social Security can help minimize taxes and maximize retirement income. Let’s break down what you need to know this November.

If you turned 73 this year (or will turn 73 in 2025), your first RMD is due by April 1, 2026. However, if you delayed your first RMD from last year, you’ll need to take two distributions in 2025: one for 2024 (by April 1, 2025) and one for 2025 (by December 31, 2025). Taking two RMDs in one year can push you into a higher tax bracket, especially if you’re also collecting Social Security.

Key takeaway:

November is a great time to review your RMD schedule and plan your withdrawals to avoid a surprise tax bill.

When you start receiving Social Security, your benefits may be subject to taxation depending on your total income. RMDs count as taxable income, so if you take a large RMD in the same year you begin Social Security, you could see a higher percentage of your benefits taxed.

Pro tip:

If you’re still working and participating in a pooled employer plan 401k, you may be able to delay RMDs from that account until after you retire (as long as you don’t own more than 5% of the business). This can help you manage your taxable income and potentially reduce the tax impact on your Social Security benefits.

The RMD starting age is now 73 for those born between 1951 and 1959. For those born in 1960 or later, the age will rise to 75 starting in 2033. The IRS also updated the life expectancy tables used to calculate RMDs, which means your annual withdrawal amount may be slightly lower than in previous years.

Pooled employer plan 401 (k) participants should check with their plan administrator to confirm RMD rules, as some plans may have unique provisions.

Missing your RMD deadline can result in a 25% penalty on the amount not withdrawn, though this can be reduced to 10% if corrected within two years. Mark your calendar for April 1 (first RMD) and December 31 (subsequent RMDs) to stay compliant.

• Coordinate RMDs and Social Security: Consider spreading out your RMDs over multiple years to keep your income—and tax bill—lower.
• Review all retirement accounts: Don’t forget IRAs, 401(k)s, and pooled employer plan 401k accounts.
• Consult a financial advisor: Every retiree’s situation is unique. A professional can help you optimize your RMD and Social Security strategy.

November is the perfect time to review your retirement income plan. By understanding how RMD timing and Social Security work together, you can make smarter decisions that help you keep more of your hard-earned money.

At Target Retirement Solutions, we’re here to help you navigate the complexities of retirement planning. Whether you’re managing a pooled employer plan 401 (k) or coordinating multiple income streams, our team can provide personalized guidance to fit your needs.

Ready to optimize your retirement income? Contact Target Retirement Solutions today for a free consultation and start planning with confidence.