If you are 73 or older and taking required minimum distributions, the timing question matters. Pulling $40,000 in January versus December changes how much of your IRA stays invested for 11 extra months. Over a 20-year retirement, that compounds. <\/p>\n
The verdict: the statistic is right, the strategy is incomplete <\/p>\n
Moss’s 71% number is consistent with long-run S&P 500 history, and his own conclusion in the same segment is the one I’d anchor to. After laying out the December case, he immediately walked it back: “However, those are just averages. And you can easily end up in a situation where the markets are not good and at the end of the year the market is down 10 or 15%. Then you have to take your RMD and what you’re doing is you’re pulling money out of the market when it’s down.” <\/p>\n
His preferred answer was monthly RMDs. “That spreads out the withdrawal, it takes away that timing of the market and it also doubles as a paycheck.” I think that framing is correct, and the math backs it. <\/p>\n
Read: Data Shows One Habit Doubles American’s Savings And Boosts Retirement<\/a> <\/p>\n Most Americans drastically underestimate how much they need to retire and overestimate how prepared they are. But data shows that people with one habit<\/a> have more than double the savings of those who don’t. <\/p>\n Run the numbers on a $500,000 IRA <\/p>\n Take a 75-year-old with a $500,000 traditional IRA. Using the IRS Uniform Lifetime Table, the RMD divisor at 75 is 24.6, which produces a required withdrawal of roughly $20,325 for the year. Three timing choices in a flat-to-up year where the S&P 500 returns 8%: <\/p>\n January lump sum. You pull $20,325 on day one. The remaining $479,675 compounds at 8% for the full year, ending near $518,000. You captured nothing on the withdrawn dollars. <\/p>\n December lump sum. The full $500,000 compounds for roughly 11 months, then you withdraw. You end with about $519,700 before the distribution. This is the Moss “market history” scenario, and in a positive year it wins. <\/p>\n Monthly RMD of about $1,694. Roughly half the RMD is invested for the full year, half is spread across the calendar. You land between the other two, closer to the December outcome than the January one. <\/p>\n Now flip the year. Assume the S&P 500 finishes down 15%, the bad-year scenario Moss flagged. The December strategy forces you to sell $20,325 at the worst prices of the year. The January strategy locked in a higher exit. The monthly strategy spread the sales across both highs and lows. <\/p>\n With the 10-year Treasury at around 4.6%, the cash you pull out can sit in a money market or short Treasury and earn something while you decide what to do with it. The opportunity cost of pulling early is real but not catastrophic. <\/p>\n The variable that decides it: your cash buffer <\/p>\n Whether the December play helps or hurts depends almost entirely on whether you need the RMD cash to live on. If your RMD funds groceries and property taxes, you cannot afford to be a forced seller into a December drawdown. Monthly distributions function as a paycheck replacement and remove the timing decision. <\/p>\n If you do not need the RMD, the calculus changes. You are simply moving money from a tax-deferred bucket to a taxable brokerage account. In that case, December timing in a positive year keeps more capital working, and a down year is a paper headache you absorb by reinvesting the proceeds. <\/p>\n What to do this year <\/p>\n Log into your IRA custodian and check whether they offer automated monthly RMD distributions. Schwab’s auto-RMD feature recalculates the monthly figure annually, which removes the math from your plate. <\/p>\n Calculate your RMD using the IRS Uniform Lifetime Table and your December 31 prior-year balance. Divide the balance by the divisor for your age. <\/p>\n Decide if you actually need the cash. If yes, set up monthly. If no, December timing is defensible and you can reinvest the after-tax proceeds in a brokerage account. <\/p>\n Withhold federal tax directly from the RMD rather than paying estimated quarterly taxes. It simplifies the 110% safe harbor for next April. <\/p>\n Moss’s 71% statistic is true, and it argues for staying invested. His follow-up answer is the one worth acting on: a monthly RMD captures most of the upside, eliminates the December timing risk, and pays you like a job. That’s the trade I’d take. <\/p>\n Data Shows One Habit Doubles American’s Savings And Boosts Retirement <\/p>\n Most Americans drastically underestimate how much they need to retire and overestimate how prepared they are. But data shows that people with one habit<\/a> have more than double the savings of those who don’t. <\/p>\n And no, it’s got nothing to do with increasing your income, savings, clipping coupons, or even cutting back on your lifestyle. It’s much more straightforward (and powerful) than any of that. Frankly, it’s shocking more people don’t adopt the habit given how easy it is<\/a>. <\/p>\n","protected":false},"excerpt":{"rendered":"On the April 21, 2026 episode of Ask An Advisor With Wes Moss, a listener named Scott asked…\n","protected":false},"author":2,"featured_media":730177,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[39],"tags":[28,147,530,920,251179],"class_list":["post-730176","post","type-post","status-publish","format-standard","has-post-thumbnail","category-personal-finance","tag-business","tag-personal-finance","tag-personalfinance","tag-sp-500","tag-wes-moss"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/730176","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/comments?post=730176"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/730176\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media\/730177"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media?parent=730176"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/categories?post=730176"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/tags?post=730176"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}