These ages mark turning points in your financial life. Understanding what each one unlocks can help you make smarter decisions, avoid penalties, and maximize your retirement strategy.
You’re 49 ½! Let’s Celebrate!
Getting there is half the fun, and arriving with a larger income is even more satisfying.
At age 50, you have the opportunity to begin making catch-up contributions to your 401(k), IRAs, and other qualified retirement plans. This allows you to accelerate your retirement savings and potentially retire with significantly more income, setting you up for a more secure financial future.
Celebrate your "half-birthday" by planning for a brighter retirement! Let’s make the next six months count.
Call us today to discuss how this milestone can become a step toward a more prosperous future.
It’s Your 54 ½ Birthday!
Best wishes for your upcoming half-birthday! Even if you’ve stopped celebrating "half" birthdays, this one is important—especially for your financial plan.
At age 55, you may be eligible to withdraw penalty-free from your 401(k), but you must meet two important criteria to avoid tax consequences.
Let’s review whether withdrawing from your 401(k) at this point is a smart strategy for you.
At Age 59 ½
Reaching 59 ½ is a significant milestone in retirement planning. You may now be eligible for in-service withdrawals from your current qualified retirement plan into an Individual IRA—without early withdrawal penalties.
Whether you’re exploring rollovers, managing portfolio risk, or planning for sustainable retirement income, now is a great time to align your strategy with your goals.
At Age 73 – Required Minimum Distributions (RMDs):
The SECURE Act 2.0 changed the rules around RMDs. Here's what you need to know:
Who Needs to Take RMD
- If you turn 73 in 2024, you must take your first Required Minimum Distribution from your retirement accounts (e.g., Traditional IRAs, 401(k)s) by April 1, 2025.
- If you turned 73 in 2023, your first RMD was due by April 1, 2024, and your second by December 31, 2024.
How RMDs Are Calculated
Your RMD amount is based on your account balance as of December 31 of the previous year, divided by a life expectancy factor from the IRS Uniform Lifetime Table.
Penalties for Missing RMDs
If you miss your RMD deadline, the penalty is 25% of the amount not withdrawn—down from 50% under previous law. If corrected within two years, the penalty may be reduced to 10%.
Important Notes:
Roth IRAs: No RMDs are required during your lifetime. However, beneficiaries of inherited Roth IRAs must follow RMD rules.
Inherited IRAs: If the original account holder passed after 2019, most non-spouse beneficiaries must withdraw the full balance within 10 years—with some exceptions (e.g., surviving spouses, minor children, or disabled individuals).
Need Help with RMDs, an Inherited IRA, or a 401(k)/IRA Rollover?
These milestones are too important to navigate alone. If you need help calculating your RMD, managing an inherited IRA, or reviewing rollover options, we’re here to help you every step of the way.
Wondering How This Applies to You?
Every situation is different. Sometimes a simple conversation can help bring clarity to the next step.
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DISCLOSURE
This article is provided for informational and educational purposes only and should not be construed as investment, tax, legal, accounting, or insurance advice. The views expressed are general in nature and may not be applicable to all individuals or situations. Individuals should consult with their own qualified professionals regarding their specific circumstances before making financial decisions.
Educational conversations referenced in this article are intended for informational purposes only and do not constitute investment advice, recommendations, or the establishment of an advisory relationship.
Securities and investment advisory services offered through Osaic Wealth, Inc., member FINRA/SIPC. Osaic Wealth, Inc. is separately owned, and other entities and/or marketing names, products, or services referenced herein are independent of Osaic Wealth, Inc.
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