Whether you are retired or just approaching retirement age, here are some milestones for you to keep in mind when planning or reviewing your retirement strategy.
Age 50: You can begin making catch-up contributions to your Traditional and Roth IRAs, as well as certain employer-sponsored retirement plans with a salary deferral feature, such as a 401(k) or 403(b). For IRAs, in tax years 2013 and 2014, you can invest an additional $1,000 over the $5,500 limit. For 401(k) and 403(b) plans, you can contribute $5,500 above the $17,500 limit in 2014.
Age 55: If you have assets in an employer's retirement plan and separate from service after age 55, you may take a distribution without facing the 10% early withdrawal tax penalty.
Age 59½: You can begin withdrawing from your Traditional IRA or retirement savings plan account without facing the 10% penalty, although income taxes still apply to any earnings and deductible contributions. You may withdraw your Roth IRA contributions without facing taxes or penalties, and if you've held the account for at least five years, you may withdraw any earnings from your Roth IRA.
Age 62: You can begin receiving Social Security benefits at a reduced 25% payout. Wondering when to claim your Social Security benefits? Weigh your options with our Social Security Benefits Evaluator.
Ages 65—67: Depending on the year you were born, you may begin drawing Social Security benefits once you reach your full retirement age.
Age 70: If you have delayed receiving Social Security benefits, payments reach their maximum amount by age 70.
Age 70½: You must begin taking required minimum distributions from your Traditional IRA or you may face a hefty tax penalty. You are never required to make withdrawals from your Roth IRA.
Participants in qualified retirement plans, such as a 401(k) or 403(b) plan, are generally required to receive a required minimum distribution by April 1st of the year following the year that you attain age 70½; check with your plan administrator if you are still employed to determine if distributions may be delayed until April 1st of the year following the year of retirement.