Ages and Stages
September 23, 2020
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After decades of working and saving, your clients are finally preparing to live out their golden years doing more of what they love.


They may want to relocate, spend more time with loved ones, or maybe make good on travel plans—but they also may be experiencing lingering anxiety about the many unknowns that accompany retirement.

As the retirement-planning landscape changes with the implementation of new legislation such as the Setting Every Community Up for Retirement Enhancement (SECURE) Act passed in 2019, it can be difficult for clients to keep track of various age-based requirements and opportunities. For instance, they may not know that the SECURE Act changed the required minimum distribution age from 70½ to 72. Be sure to communicate these important ages to your clients to maximize their benefits and prevent costly missed opportunities.

Age 50

Your clients can save extra money in 401(k)s and IRAs as they age by utilizing catch-up contributions. Make sure your clients know that workers age 50 and older can defer taxes on as much as $26,000 in 401(k), 403(b), and 457 plans as well as $7,000 in IRAs in 2020—$6,500 and $1,000 more, respectively, than younger employees.

Age 55

Your clients have the option to take 401(k) withdrawals from a retirement account associated with their latest job without having to pay the 10% early withdrawal charge if they retire, quit, or are laid off from that job during the year they turn age 55 or later. The same rule applies to public-safety retirees as early as age 50.

Age 591/2

Your clients no longer will need to pay the 10% early withdrawal charge when they reach age 59½. Remember to advise them that income tax still will be due on any traditional 401(k) and IRA withdrawals.

Age 62

Though your clients can begin collecting Social Security retirement benefits at age 62, it is important to remind them that collecting at this age will permanently reduce their payments by as much as 30%. Additionally, be sure to tailor your clients’ Social Security strategies with their work plans. Continuing to work while collecting Social Security benefits can result in the temporary withholding of part or all of their current payments.

Source: U.S. News & World Report, “12 Important Retirement Planning Deadlines” by Emily Brandon, staff writer. May 6, 2013.
Tags: Medicare, 401(k)s, retirement, Social Security, IRAs


Age 65

Be sure your clients are well-versed in eligibility requirements for Medicare. Once they become eligible at age 65, they have a seven-month window (starting three months before their 65th birthday) to sign up for Medicare. After that window passes, clients run the risk of higher Medicare Parts B and D premiums or the denial of supplemental coverage. For example, Medicare Part B enrollment incurs a 10% late enrollment penalty for every 12-month period your client goes without signing up when they should have.

Age 66

For clients born between 1943 and 1954, this is the full retirement age, which is the age at which they are eligible to collect their full Social Security benefits. This full retirement age gradually increases from 66 and two months for clients born in 1955 to 66 and 10 months for those born in 1959. Additionally, your clients who have reached full retirement age no longer have to worry about penalties associated with simultaneously working and collecting Social Security benefits.

Age 67

For clients born in 1960 or later, the full retirement age is 67. Advise your clients that they can avoid earnings limits on payments by waiting to collect Social Security benefits until full retirement age or later.

Age 70

For an extra boost in Social Security income, advise clients that their payments increase by 8% for every year they delay signing up for Social Security benefits until age 70. Remind them not to wait longer than age 70, as there is no additional benefit to further postponing Social Security payments.

Age 72

Your clients must begin taking taxable required minimum distributions (RMDs) on funds from 401(k) accounts and traditional IRAs at age 72. Be sure to clarify that failure to take RMDs can lead to a 50% tax on the amount that should have been withdrawn. Keep in mind that clients who remain employed after their 72nd birthdays also may delay RMDs on 401(k) accounts only until April 1 of the year after they retire.

Your clients also may need guidance to navigate the various date-based retirement deadlines and cutoffs. Keeping these dates in mind as clients approach retirement can help them avoid penalties, fees, and missed tax opportunities. Make sure you consider these dates as you build your clients’ retirement strategies.

December 1

As a general rule of thumb, advise your clients that any 401(k) contributions must be made and annual RMDs should be taken by December 31 each year. However, make sure they remember that this rule does not apply to the first RMD they take.

April 1 

Your clients must take their first RMD from 401(k) accounts or IRAs by April 1, but you should advise clients that pushing the first distribution until April could result in a much higher tax bill than if they take only one payment per tax year.

April 15

Clients of any age with earned income have until April 15 to make IRA contributions that will count for the previous year’s tax return. Not only will they be saving for their futures, but they also may receive an immediate tax deduction for that year’s return.


For more information on retirement-planning strategies, please contact the Retirement Strategies Group at (800) 722-2333, or email us at




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