RMD at 73 on a $1.4M IRA: Should You Sell Bonds or Stocks During the 2026 Bond Market Sell-Off?

You're 73. Your traditional IRA is worth $1.4 million. SECURE 2.0 says you owe Uncle Sam a required minimum distribution this year — no negotiating that part. But here's the question nobody asks you at tax time: which asset do you actually sell to generate that RMD?

Normally that question doesn't matter much. Sell a little of everything, keep your allocation roughly intact, move on. But 2026 isn't a normal year for that decision. CNBC's Personal Finance desk reported this month that the bond market is in a genuine sell-off — rising government deficits, climbing Treasury yields, and inflation jitters are pushing bond prices down at the same time equities have had a decent run. When one sleeve of your portfolio is down and the other is up, and you're being forced by law to sell something, the asset you choose to liquidate has real, calculable consequences.

This is the kind of decision that looks small in any single year and compounds into tens of thousands of dollars over a decade of RMDs. Let's run the numbers.

What SECURE 2.0 Actually Requires at 73

Quick refresher, because the rules have moved twice in four years. SECURE 2.0 pushed the RMD starting age to 73 (rising to 75 in 2033), and the IRS Uniform Lifetime Table sets your divisor. At age 73, that divisor is 26.5.

For a $1.4 million IRA balance as of December 31 of the prior year:

$1,400,000 ÷ 26.5 = $52,830 — that's the RMD you must withdraw this year, full stop, regardless of what the market is doing.

The IRS doesn't care whether you pull that $52,830 from your bond fund, your S&P 500 index fund, or a mix of both. Your tax bill is identical either way — RMDs are taxed as ordinary income no matter the source. What changes is what's left in your account afterward, and that's where the bond sell-off matters.

The Worked Example: A 60/40 Portfolio in a Rate Shock

Say your $1.4M IRA is allocated 60% stocks, 40% bonds — a fairly standard glide path for someone in their mid-70s.

• Stock sleeve: $840,000
• Bond sleeve: $560,000

Now overlay the 2026 environment CNBC described: Treasury yields climbing as deficit concerns and inflation worries push investors to demand more compensation for holding long-duration debt. If your bond sleeve is down roughly 8% from where it sat before the sell-off began, that $560,000 was worth about $608,700 before the repricing — meaning you're sitting on an unrealized paper loss of roughly $48,700 in bonds alone, while your stock sleeve is up double digits over the same stretch.

Three ways to source the $52,830 RMD

Strategy	What you sell	Immediate tax bill	What happens to your remaining allocation
A: Proportional	40% bonds / 60% stocks	$52,830 taxable, same in all three	Allocation stays roughly 60/40
B: Sell bonds only	$52,830 from the depressed bond sleeve	$52,830 taxable, same	Locks in the loss on that slice permanently; bond sleeve drops to $507,170 and can't participate in any snapback
C: Sell stocks only	$52,830 from the appreciated stock sleeve	$52,830 taxable, same	Bond sleeve stays fully intact at $560,000, positioned to recover if yields stabilize; stock sleeve trims to $787,170

The tax line is identical across all three — that's the part people assume changes and it doesn't. What actually moves is opportunity cost. If bonds later recover even half of that 8% drawdown as the yield spike settles (a plausible scenario, not a promise), Strategy B forfeits about $2,113 of recovery on the withdrawn amount alone, permanently, because that money is no longer in the account to benefit. Strategy C keeps the full bond sleeve in the game.

This is the same underlying mechanic behind sequence-of-returns risk — selling a depressed asset to meet a cash need locks in a loss that a patient investor wouldn't otherwise take. It usually gets discussed in the context of a stock market crash in year one of retirement. In 2026, the mirror image is happening in bonds, and RMD-age retirees are the ones being forced to transact regardless of price.

This is the kind of asset-location math Lontevis runs automatically — so you're not eyeballing which sleeve to trim every time an RMD comes due.

Where Rising Yields Actually Work in Your Favor

Here's the part that gets lost in sell-off headlines: higher yields aren't only bad news. If you don't need to spend your RMD proceeds — a common situation for retirees whose Social Security and pension already cover living expenses — the forced sale becomes an opportunity to upgrade your fixed-income yield.

Say your existing bond ladder rungs were purchased when the 10-year Treasury sat around 3.5%. CNBC's coverage of the current sell-off points to yields meaningfully higher than that as the market repriced. If you take the RMD, pay the tax, and reinvest the after-tax proceeds into new bonds at, say, 4.8% instead of letting that same money sit in a 3.5% legacy holding, you've picked up roughly 1.3 percentage points of income on that slice — permanently, or at least until the new bonds mature.

On $41,200 (a rough after-tax figure assuming a 22% marginal rate on the $52,830 RMD), that's about $536 a year in additional income from the exact same dollars, just relocated to a higher-yielding instrument outside the tax-deferred account. It's not a fortune on its own, but stack that across a decade of RMDs from a $1.4M account and you're compounding a meaningfully larger income stream than if you'd just let old, lower-yielding bonds sit untouched. This is the same logic covered in Bond Ladder vs Dividend Income vs Annuity — a rate environment like this one is exactly when rebuilding your income floor with fresh, higher-yielding rungs pays off.

The QCD Move That Sidesteps the Tax Question Entirely

If you're charitably inclined, SECURE 2.0's expanded Qualified Charitable Distribution rules let you send RMD dollars — up to the annually indexed limit — directly from your IRA to a qualified charity, and that portion never touches your taxable income at all. For someone whose $52,830 RMD would otherwise stack on top of Social Security and pension income, a QCD of even $20,000–$30,000 can meaningfully reduce your adjusted gross income, which matters not just for your bracket but for Medicare IRMAA surcharges two years later. That mechanic is worth a closer look if it applies to you — we covered the specifics in SECURE 2.0 RMD Age 73 + New QCD Rules.

Check Your IRMAA Exposure Before You Decide Anything

Quick sanity check for the $1.4M household in this example: Social Security of $30,000, a modest pension of $20,000, plus the $52,830 RMD puts total income around $102,830 before deductions. After the standard deduction for a couple filing jointly, taxable income lands comfortably in the 12%–22% range — nowhere near the roughly $212,000 MFJ threshold where Medicare Part B and D surcharges kick in for 2026. But if your RMD is larger, or you're also realizing capital gains from rebalancing after the bond sell-off, that IRMAA cliff deserves its own look — it's a two-year lookback, so this year's decisions show up on your premium bill in 2028.

What This Means for Your Numbers

None of this changes what SECURE 2.0 requires you to withdraw. It changes how you satisfy that requirement in a way that either compounds in your favor or quietly costs you money every year the bond sell-off continues. The right answer depends on your specific allocation, your marginal tax bracket, whether you need the cash for spending, and how close you are to an IRMAA threshold — variables that are different for every household with a $1.4M IRA, not just this one.

That's exactly the kind of scenario you can model for your specific situation at Lontevis — plug in your actual balance, allocation, and income sources, and see which withdrawal-asset order keeps the most money compounding for you, this RMD and every one after it.

Sources

• Bond market sell-off: How investors can move and protect their money as rates rise — CNBC Personal Finance
• Southwest Lounges and a New Premium Card Are Coming in 2027 — NerdWallet Retirement
• Here’s Why Chicken Is So Expensive Now — NerdWallet Retirement
• Apple Card vs. Samsung Card: How They Differ — NerdWallet Retirement
• Marcus by Goldman Sachs Savings Interest Rate: How It Compares — NerdWallet Retirement