If you turned 73 this year, there's a date on the calendar that matters more than your birthday.
It's December 31, and it's the deadline for your first required minimum distribution, or RMD.
Miss it, and the IRS charges a 25% penalty on the amount you should have withdrawn.
Withdraw too little, and you pay a quarter of what you kept as a tax.
Withdraw nothing at all, and the same math applies to your entire RMD.
Once you hit 73 (or 75 if you were born in 1960 or later), the government stops letting your traditional IRA and 401(k) sit untouched forever.
Each year, you must pull out a minimum amount based on your account balance and a life expectancy factor the IRS publishes.
Divide your December 31 balance from the prior year by the factor for your age.
At 73, that factor is about 26.5, so a $500,000 account means roughly $18,900 must come out.
At 80, the factor drops to about 20.2, pushing the required amount higher.
The penalty dropped from 50% to 25% a few years ago, and it can fall to 10% if you fix the mistake quickly.
But "quickly" means filing the right paperwork and withdrawing the shortfall fast.
Most people don't know that window exists until they're already paying.
The first RMD has a special rule: you can delay it until April 1 of the following year.
Sounds generous, but it means taking two RMDs in the same tax year, which can shove you into a higher bracket and raise your Medicare premiums.
Roth IRAs have no RMDs during your lifetime.
That's a big reason financial planners tell people to convert or contribute to Roth accounts when it makes sense.
If your money is already taxed, the government doesn't demand a cut each year.
Still-working 401(k) rules trip up plenty of people too.
If you're still employed at 73 and don't own more than 5% of the company, your current employer's plan may let you skip RMDs until you actually retire.
That exception does not apply to old 401(k)s from former jobs or to IRAs.
You can total up your IRAs and take the full RMD from just one of them.
Mixing those rules up is a common and expensive mistake.
Check your balance on December 31, not in January.
If you have multiple accounts, write down which ones can be combined and which can't.
And if the amount pushes you into a higher tax bracket, consider taking part of it earlier in the year or having taxes withheld.
Many brokerages will calculate the RMD for you and even set up automatic withdrawals.
Turning that on takes ten minutes and removes the risk of forgetting entirely.
RMDs aren't a punishment, they're a scheduling problem.
The people who get burned are rarely the ones who did the math wrong.
Final Thoughts
They're the ones who never knew the deadline existed until the IRS sent a letter.