Don't Need Your Required Minimum Distribution (RMD) Right Away? Here Are Smart Ways to Use the Extra Cash.
The Motley Fool
by newsfeedback@fool.com (Dana George)February 19, 2026
AI-Generated Deep Dive Summary
Retirees who do not immediately need their Required Minimum Distributions (RMDs) have an opportunity to use this extra cash wisely. RMDs must be taken from retirement accounts like 401(k)s and IRAs starting at age 73 (or 75 for those born in 1960 or later), but if the funds aren’t needed for living expenses, there are smart strategies to maximize their impact. Instead of letting this money go unused or spending it carelessly, individuals can invest it back into their financial future or use it for other worthwhile purposes.
One key strategy is using RMD proceeds to pay off high-interest debt, such as credit cards or personal loans. This can save significant interest over time and improve your overall financial health. Another option is reinvesting the money in a taxable brokerage account or paying premiums for deferred annuities that provide future income. This allows you to maintain tax-deferred growth while still keeping the funds accessible.
For those looking to support causes they care about, making tax-deductible donations to charity is another smart use of RMD cash. Additionally, individuals can consider using this money to fund education expenses for themselves or family members, leveraging opportunities like 529
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Originally published on The Motley Fool on 2/19/2026