Are you making this big RMD mistake? More than 80% of US retirees are — and it’s quietly hurting their income under Trump

That looks like prudence. It is often a mistake. Here’s why.

Timing mismatch and tax deductions

Roughly 80% of retirees didn’t tap into their retirement accounts until required minimum distributions (RMD) kicked in, according to JP Morgan research cited by CNBC. IThat means many older Americans are waiting for the government to force them to take money out of their retirement accounts.

To be fair, this research was conducted between 2013 and 2018, and a lot has changed since then, including the RMD age. But it’s fair to assume that a significant number of retirees in 2026 are delaying withdrawals until they’re obligated to do so.

This is a problem for two reasons: timing mismatch and tax deductions.

First, waiting until RMD age generates cash flow at the wrong time. Analysis of actual spending patterns by JP Morgan suggests that most retired household spending peaks early (during their 60s) and gradually declines with age. In other words, you’re more likely to need the cash during the go-go years of your 60s, when you’re still in full health and enjoying active vacations, rather than your mid-70s or 80s.

Second, President Donald Trump’s overhaul of the tax code has created another reason to withdraw early. The One Big Beautiful Bill Act unlocks a new enhanced deduction for taxpayers aged 65 and older worth $6,000 ($12,000 for married couples if both qualify). This new deduction is only available through 2028, so there isn’t much time to take advantage of it.

Simply put, if you’re in your 60s, there’s plenty of reasons to take early withdrawals now rather than wait for your 70s. If you’re unsure about the best way to optimize withdrawals, there are several ways to make the process easier.

How to structure your withdrawals

Navigating withdrawals from retirement accounts isn’t easy, especially if you’re trying to minimize the tax bill along the way.

If you don’t need the cash right away but don’t want to leave it idle until RMDs, you could consider investing the withdrawals in alternative assets like real estate. Platforms like Arrived can help you gain exposure to vacation homes and rental properties that offer steady cash flows over several years.

Backed by world-class investors, including Jeff Bezos, Arrived allows you to invest in shares of vacation and rental properties, earning a passive income stream without the extra work that comes with being a landlord of your own rental property.

To get started, simply browse through their selection of vetted properties, each picked for their potential appreciation and income generation. Once you choose a property, you can start investing with as little as $100, potentially earning monthly dividends.

Plus, for a limited time, when you open an account and add $1,000 or more, Arrived will credit your account with a 1% match.

Staying ahead of the curve

If you’re worried about changes to the tax code, RMD rules or Social Security, it might be a good idea to get an AARP membership to help you stay ahead of the curve.

As one of the most trusted organizations for older Americans, AARP not only offers money-saving perks, but they can also help you make informed financial and health decisions. AARP members get access to guides that can help you make the most of Social Security, choose the right Medicare plan and uncover other government benefits — potentially saving you thousands.

Sign up with AARP today and get 25% off your first year.

Get some help

Finally, if your retirement accounts are sizable, you could hire a professional to help you navigate these complex rules. As your personal wealth grows, things like managing withdrawals, minimizing tax exposure and ensuring long-term sustainability often requires greater coordination and strategic planning.

In these cases, working with a financial advisor can help reduce costly mistakes. And if you have a portfolio of $250,000 or more, platforms like WiserAdvisor can connect you with vetted professionals who specialize in this kind of planning.