What is a required minimum distribution?

A required minimum distribution, or RMD, is the amount the IRS makes you withdraw each year from traditional retirement accounts like a 401(k) or traditional IRA once you reach a certain age. Currently those withdrawals must begin at age seventy-three. The point is that the government wants to start collecting the taxes it deferred while your money grew. Roth IRAs are exempt during your lifetime, and missing an RMD can trigger a steep penalty.