A Couple Who Retires at 62 With $650,000 Between Two IRAs and a $48,000 Pension Will Meet About $42,000 of RMDs at 73, and the RMD Keeps Growing From There: Closer to $57,000 a Year by 80

A married couple who stop working at 62, with $650,000 split between two traditional IRAs and a $48,000 annual pension, have a long runway before the IRS steps in. The pension will cover the basics, and the IRAs can sit unused for more than a decade.

Eventually, though, required minimum distributions (RMDs) start pulling money out on a fixed schedule, and that schedule speeds up with age. This scenario assumes both spouses are the same age, the IRAs earn 5% a year, and nothing is withdrawn before RMDs begin. Under those assumptions, the first RMD is about $41,952 at 73, and by 80 it’s roughly $57,209.

Where a $650,000 Couple Stands Against Typical Retirees

The good news is that this couple is well ahead of most of their peers. Fidelity puts the average IRA balance for Baby Boomers at $257,002. Transamerica’s survey puts median household retirement savings for Boomers at $270,000. The median is the household in the exact middle, so a few very large accounts can’t drag it up the way they lift an average. Compared with either number, $650,000 plus a pension puts this couple in the upper tier, where RMDs become a real tax-planning issue.

Eleven Untouched Years Turn $650,000 Into $1.1 Million

IRA owners must start distributions by April 1 of the year following the year in which you reach age 73, according to IRS Publication 554. If the money sits unused and grows 5% a year from age 62, the combined balance comes to about $1.11 million by the end of the year the couple turns 72.

Because neither spouse is more than 10 years younger than the other, each uses Table III, the Uniform Lifetime table. Its divisor at 73 is 26.5, and dividing the balance by that divisor gives the first RMD of roughly $41,952.

Why the Required Withdrawal Keeps Climbing Through 80

The divisor drops every year. It goes from 26.5 at 73 to 20.2 at 80, so each year the IRS requires a larger share of the account to come out. In the early years, though, 5% growth exceeds the required withdrawal. At age 79, the balance is still about $1.16 million, more than it was before RMDs began.

A larger balance divided by a smaller number produces an RMD of about $57,209 at 80, about 36% higher than the first one. In this setup, the withdrawals rise alongside the account.

Combining Pension, RMDs and Social Security

Add the pension to the first RMD, and the couple has $89,952 in income before Social Security. Social Security estimates the average aged couple receiving benefits will collect $3,355 per month after the 3.6% COLA for 2027, which comes to $40,260 a year.

That puts gross household income at about $130,212 at 73 and $145,469 at 80, before any COLA increases. Federal law counts IRA distributions as included in gross income under 26 U.S.C. § 408(d)(1). In 2025, the 12% bracket for married couples filing jointly ends at $96,950 of taxable income.

The 22% bracket runs to $206,700. Deductions lower taxable income, but the pension and RMDs alone push the couple toward the top of the 12% bracket. As RMDs grow, more of that income moves into the 22% bracket.

Using the Window Between 62 and 73 Before It Closes

The eleven years before RMDs begin are when the couple has the most control, and a free guide covers how to use the Roth window while it is open. Several planning options apply during this period:

• Fill the low brackets early. While the pension is their only income, partial Roth conversions or planned IRA withdrawals reduce the balance on which later RMDs are calculated. Conversions are taxable in the year they happen, according to IRS Publication 17, so the goal is to pay tax at 12% now instead of 22% later.
• Plan for charitable giving. Publication 17 lists qualified charitable distributions as an exception to the rule that IRA distributions are taxable. For couples who already give, sending gifts straight from the IRA counts toward the RMD without adding to taxable income.
• Watch the first-year timing. Delaying the first RMD to April 1 means the second is still due by December 31 of the same year, combining two withdrawals into one tax year. Withdrawing too little can also trigger an excise tax under 26 U.S.C. § 4974.

What These Numbers Mean for Above-Average Savers

The results depend on the 5% return assumption. Weaker markets would lower both the balance and the RMDs, and stronger markets would raise them. In either case, a couple who saves well and lets the money grow faces forced withdrawals that get bigger each year, on top of a pension and Social Security they can’t turn off. For households above the median, the question is when to pay the tax, and the years between 62 and 73 offer the most flexibility for that decision.

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