RMDs

Mass affluent clients who have the bulk of their financial wealth in tax-deferred accounts such as individual retirement accounts must take substantial required minimum distributions when they turn age 73.

Some clients may dread the prospect of having to pay taxes on these distributions. But a professor and author said advisors must reassure these clients that there is little to fear from RMDs. Edward McQuarrie, professor emeritus in the Leavey School of Business at Santa Clara (Calif.) University, said RMDs are highly unlikely to exhaust a client’s savings during their lifetime.

The required amount to be withdrawn glides upward slowly at first, he explained. The withdrawal percentage doesn’t hit 10% until the account holder is in their mid-90s; even when they reach age 100, the withdrawal percentage is about 16%.

Clients also can donate their RMDs to charity, making a qualified charitable distribution to reduce their taxable income. A client who does not want to donate their RMDs to charity can take the RMD and invest the after-tax remainder, McQuarrie said.

matic results, according to data Roame shared. Women, in particular, are breaking through. From the advisor role all the way to the CEO chair, the number of women in these positions is up sharply.

Likewise, 58% of the total employees in wealth or investment management are either minorities or women, but the vast majority of this group comprise administrative, analyst and associate roles.