Direct answer: In your 70s, most savers hold a mix of traditional IRAs and 401(k)s (subject to RMDs), Roth IRAs (no RMDs during your lifetime), taxable brokerage accounts (preferential capital gains rates), and Social Security income. Each account has distinct tax treatment and withdrawal sequencing rules.
Account Types in Your 70s: What You Have and How to Use Each
Traditional IRA and 401(k): RMD Required
Traditional IRAs and 401(k)s hold pre-tax contributions and investment growth. Withdrawals are taxed as ordinary income. Once you reach your RMD starting age, you must take a Required Minimum Distribution each year. The RMD amount is calculated from your prior-year December 31 balance divided by a life expectancy factor from the IRS Uniform Lifetime Table.
A qualified charitable distribution (QCD) allows you to transfer up to $108,000 per year (2026 figure, indexed for inflation) directly from a traditional IRA to a qualified charity. The QCD counts toward your RMD but is excluded from your gross income, making it more tax-efficient than taking the RMD as cash and then donating it.
Roth IRA: No RMD, Tax-Free Growth
Roth IRAs hold after-tax contributions and grow tax-free. There are no Required Minimum Distributions during the account owner's lifetime. This makes the Roth IRA ideal for funds you expect to use later or want to pass to heirs, who will generally receive tax-free distributions subject to the 10-year inherited IRA rule.
If you have not yet converted any traditional IRA funds to Roth, a partial conversion each year (filling lower tax brackets) can reduce future RMDs from the traditional IRA while building a tax-free balance.
Taxable Brokerage Accounts: Preferential Rates and Step-Up
Taxable brokerage accounts do not have RMDs. Qualified dividends and long-term capital gains (assets held over one year) are taxed at preferential rates (0%, 15%, or 20% depending on income). One of the most significant tax features of taxable accounts for estate planning is the step-up in cost basis at death: your heirs inherit assets at their fair market value on the date of your death, eliminating embedded capital gains. This makes taxable accounts among the most efficient to pass to heirs.
Social Security: Not an Account, But a Key Income Source
Social Security is not an investment account but an income stream funded by your prior payroll contributions. Up to 85% of your Social Security benefit may be included in your federal taxable income depending on your combined income. The benefit is monthly, inflation-adjusted via the annual cost-of-living adjustment (COLA), and guaranteed for life.
If you are married, understand survivor benefit rules. When one spouse dies, the surviving spouse receives the larger of the two benefits. Coordinating timing and claiming strategy is most valuable when the two spouses have different benefit amounts.
Pension and HSA
If you receive a pension, it functions like an additional income stream taxed as ordinary income. Unlike IRAs, you generally have no discretion over timing or amount.
If you reached age 65 with an HSA balance, HSA funds can be withdrawn for any purpose (not just medical) and are taxed as ordinary income like a traditional IRA. HSA withdrawals for qualified medical expenses remain tax-free at any age. There are no RMDs for HSAs during the account owner's lifetime.
Frequently Asked Questions
What is a qualified charitable distribution (QCD)?
A qualified charitable distribution is a direct transfer from a traditional IRA to a qualified charity. In 2026, individuals age 70.5 or older can transfer up to $108,000 per year as a QCD. The amount transferred counts toward satisfying your RMD for the year but is excluded from your adjusted gross income, which can reduce Medicare premiums and the taxable portion of Social Security benefits. QCDs must go directly from the IRA custodian to the charity, not to you first.
Do Roth IRAs have RMDs?
Roth IRAs do not have Required Minimum Distributions during the account owner's lifetime. Your Roth IRA can continue growing tax-free without any mandatory withdrawals. Roth 401(k) accounts, however, were previously subject to RMDs, though SECURE Act 2.0 eliminated RMDs for Roth 401(k)s starting in 2024. Your Roth IRA beneficiaries will generally be subject to the 10-year rule for inherited Roth IRAs.
How is Social Security taxed?
Up to 85% of Social Security benefits may be included in your federal taxable income depending on your combined income (adjusted gross income plus nontaxable interest plus half of Social Security benefits). If combined income exceeds $44,000 for married filing jointly ($34,000 for single filers), up to 85% of benefits are taxable. Social Security is never 100% federally taxable. Some states also tax Social Security income, though many exempt it entirely.