Configure Inputs

73
50100
$500.00K
$
$10.00K$5.00M
5%
%
015

Current Year RMD

$18,867.92

Divisor Factor: 26.5

This amount must be withdrawn by Dec 31 to avoid penalties (up to 25%).

20-Year Projection

Wealth Compounding Projection

Visualizing how your principal amount and interest grow over time.

Note: "Invested Amount" represents Account Balance, "Interest Gained" represents RMD Payout.

Deep Dive & FAQ

The "Use It or Lose It" Rule

The IRS allows your retirement savings (Traditional IRA, 401k) to grow tax-deferred for decades. However, the government eventually wants its tax revenue. Starting at age 73, you are legally required to withdraw a specific minimum amount every year.

⚠️ The Heavy Penalty

If you fail to take your full RMD by the deadline (usually Dec 31), the IRS imposes a penalty (excise tax) of up to 25% of the amount not withdrawn. This is one of the steepest penalties in the tax code!

How is it Calculated?

Your RMD is calculated by dividing your account balance (as of Dec 31 of the prior year) by a Life Expectancy Factor from the IRS Uniform Lifetime Table. As you get older, this factor decreases, forcing you to withdraw a larger percentage of your portfolio.