4 Best Boomer Money Moves in Late 2025
Written by
Andrew Lisa
Edited by
Amen Oyiboke
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The final fiscal quarter provides an opportunity to reflect on the financial year that you’re leaving behind while planning for the one ahead, regardless of your age and generation.
However, it’s especially crucial for baby boomers to use the waning months of 2025 to set themselves up for success in the new year.
The following four late-year money moves can help boomers end this year and start the next one on a strong financial footing, depending on whether they’re already retired or nearing retirement.
1. Max Out Retirement Accounts
According to Mass Mutual, boomers still in the workforce but nearing retirement should focus first and foremost on maxing out their 401(k)s, IRAs, Roth IRAs and similar accounts while they still have paychecks coming in.
It’s critical to fuel compounding and growth while sheltering contributions in a tax-privileged account during the crucial final few years of work in the run-up to retirement, with older savers making sure to take full advantage of catch-up contributions. If you can’t max them out, contribute at least enough to secure your full employer match — it’s your last chance to stuff your nest egg with free money.
2. Take — or at Least Plan for — RMDs
If you’re 73 or older, the IRS reminds you to avoid penalties by taking required minimum distributions (RMDs) for the following account types:
- 401(k) plans
- 403(b) plans
- Traditional IRAs
- SIMPLE IRAs
- SEP IRAs
- Profit-sharing plans
- 457(b) plans
If you turned 73 this year, you have until April 1, 2026, to take your RMDs, but everyone else must act by Dec. 31. Either way, the final quarter of 2025 is the time to plan so you don’t enter a new tax year without strategizing for the associated income and tax implications — and the stakes are high. Failing to take an RMD, or withdrawing less than required, can result in an excise tax of up to 25%.
3. Reduce Your Tax Burden With Charitable Donations
According to Fidelity, the IRS allows those ages 70 1/2 and older to bypass RMD rules with qualified charitable donations (QCDs) — but they must act by Dec. 31. In lieu of RMDs, boomers can donate up to $108,000 directly to charitable organizations. Those who do can get the dual benefit of avoiding higher tax brackets while remaining under phase-out thresholds for tax credits and deductions.
4. Consider a Roth Conversion
Many boomers can benefit by settling their obligation to the IRS on pre-tax retirement accounts sooner rather than later through Roth conversions. According to Kiplinger, converting a traditional IRA to a Roth IRA triggers a potentially hefty tax bill now, but some 60- and 70-somethings can win in the long run by ripping off the band-aid.
After you convert to a Roth account, you can make tax-free withdrawals on your contributions right away and, after five years, on your investment earnings for the rest of your life. Additionally, Roth IRAs don’t impose RMDs like pre-tax accounts, and heirs can usually inherit them tax-free.
Talk with your financial advisor first, but if you decide a Roth conversion is right for you, the deadline to include it in your 2025 taxable income is Dec. 31.
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