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Taking Your RMD? Consider Your Options

If you are at least 70½ and own an Individual Retirement Account, you’re probably aware that you must start taking required minimum distributions (RMDs). But, what if you are in the fortunate situation of NOT needing the money for day-to-day expenses? Here are some options for those assets: 

Set up a 529 college savings plan. The tax-advantaged growth offered by a 529 college savings plan could provide an attractive option for investing your RMDs. OppenheimerFunds 529 Plans offer many benefits to help a family member such as a child or grandchild with higher education costs.                  

Allocate money to taxable accounts. You may no longer be seeking the possibility of aggressive portfolio growth but still like the idea of generating income. Reinvesting an RMD in taxable accounts allows for the possibility that your assets may keep growing. Investments such as bond funds may be an attractive strategy. And, you can learn the steps to opening an OppenheimerFunds account.

Open a Roth IRA. Even though you are no longer eligible for making Traditional IRA contributions, you may take an RMD and then contribute it to a Roth IRA. To do this you must have earned income equal or greater than the contribution amount and your income must fall below the Roth maximum contribution limits.

Next Steps

This material is provided for general and educational purposes only, and is not intended to provide legal, tax or investment advice, or for use to avoid penalties that may be imposed under U.S. federal tax laws.  Contact your attorney or other advisor regarding your specific legal, investment or tax situation.

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Shares of Oppenheimer funds are not deposits or obligations of any bank, are not guaranteed by any bank, are not insured by the FDIC or any other agency, and involve investment risks, including the possible loss of the principal amount invested.

Before investing in any of the Oppenheimer funds, investors should carefully consider a fund's investment objectives, risks, charges and expenses. Fund prospectuses and summary prospectuses contain this and other information about the funds, and may be obtained by asking your financial advisor, visiting oppenheimerfunds.com, or calling 1.800.CALL OPP (225.5677). Read prospectuses and summary prospectuses carefully before investing.

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