Five important ages for retirement planning
When your employees are in their 20’s, retirement can seem extremely far away. As they approach their 40’s, however, they should begin to view retirement and retirement planning in a different light. As a matter of fact, there are certain considerations they should make at age 50, 59 ½, 65, 66, and 70 ½ to ensure they enjoy the retirement life they envision and avoid costly penalties.
Continue reading to learn more about some of the most important ages your employees should pay attention to for retirement planning. Click each link within the section to watch a short video on the associated age.
At age 50, your employees will become eligible to save more the standard amount in their 401(k) and IRA accounts, which qualifies them for a larger tax deduction.
Watch The Most Important Ages for Retirement Planning: Age 50 video to learn more about how turning 50 can impact your employee’s retirement savings
Age 59 ½
Traditional retirement accounts like IRAs and 401(k)s have a 10% early withdrawal penalty if your employees take a distribution before age 59 ½ in addition to any income tax due. By waiting until the age of 59 ½ to take a withdrawal, your employees will get to keep an additional 10% of their money.
Watch The Most Important Ages for Retirement Planning: Age 59 ½ video to learn more about withdrawal penalties and withdrawal penalty exceptions
Your employees will be able to sign up for Medicare during a seven-month period starting three months prior to their 65th birthday. It’s important they sign up for Medicare on time to avoid any late enrollment penalties that could be permanently applied to premiums.
Watch The Most Important Ages for Retirement Planning: Age 65 video to learn more about the healthcare services, penalties and eligibility.
Baby boomers born between 1943 and 1954 will be eligible to begin claiming the full Social Security benefit they’ve earned at age 66. However, if someone starts prior to or after age 66, their benefit could be less or more than the full amount – respectively.
Watch The Most Important Ages for Retirement Planning: Age 66 video to learn more about Social Security benefits.
Age 70 ½
Your employees have worked hard saving for quite some time, and now it’s time for them to enjoy their retirement. Whether it’s needed or not, they’ll be required to take distributions from their traditional IRAs, traditional 401(k)s and Roth 401(k)s after age 70 ½,.
Watch The Most Important Ages for Retirement Planning: Age 70 ½ video to learn more about Minimum Required Distributions.
Contact your Voya representative to learn more about ways you can help your employees plan for retirement.
This video is an editorial product of U.S. News & World Report, L.P. Voya Financial was not involved with the preparation of the content of this video.