Retirement, Social Security

Will You Have a Milestone Birthday This Year?

013015-birthday65-balloonBirthdays are usually nice, but some are nicer than others. You’ll receive far more than a birthday cake when you reach certain milestone years. In fact, 2015 could be big step forward in your financial fitness.

Our 2015 Key Birthday reference card has a handy list. Click here to download your complimentary copy – and read on for additional good news.

If you were born in 1965, you’ll turn 50 this year. That means you can start making additional “catch-up” contributions to your IRA, Roth IRA, 401k and other qualified retirement accounts.

For Traditional IRAs and Roth IRAs, you can set aside an additional $1,000 on top of the $5,500 allowed to younger taxpayers. If you have a 401k, 403b, 457b or Roth 401k, you can save an additional $6,000 as well as the $18,000 standard allowance.

If you were born in 1960, you’ll turn 55 this year. If you have a workplace retirement plan and you separate from the employer this year or after, you take the distribution as a lump sum and not pay the normal 10% withdrawal penalty. You will have to pay income on the distribution, however, so we don’t often recommend this course. Nevertheless, the option is available to you now.

If you were born between July 1, 1955 and June 30, 1956, you’ll turn 59½ this year. Congratulations! You can start taking penalty-free distributions from your IRA and qualified retirement plan accounts. You can do the same from Roth IRAs if you opened the account at least five years ago.

This doesn’t mean you should start taking such withdrawals. Generally, you want to delay withdrawing and defer taxes on the growth as long as possible. It’s a good idea to talk to your financial advisor and a tax professional before you make this decision.

If you were born anytime in 1955 and you are a widow or widower, reaching age 60 enables you to apply for early Social Security benefits under your deceased spouse’s earnings record.

If you were born in 1953, you’ll turn 62 this year. That means you can apply for early Social Security benefits. You’re monthly benefits will be lower than if you wait for full retirement age or later, but it can make sense in some situations. Contact Republic Wealth and we’ll help you make your decision.

If you were born in 1950, your 65th birthday comes up this year. Time to retire? Not if you want full Social Security benefits, but you can still sign up for Medicare benefits unless you have health coverage through a group plan. You should do this within three months of turning 65 or your Medicare premium costs could be higher.

If you were born in 1949, you’ll turn 66 this year. Congratulations! You can now claim full Social Security benefits and officially retire. Should you retire? Maybe not. You may not want to retire yet if you’re healthy and enjoy your work. You can also enhance your eventual benefit amount by waiting a few more years.

If you’re wondering when you will reach retirement age, the answer is somewhere between age 66 and age 67, depending what year you were born. It used to be age 65 but that’s no longer true for people born in 1938 or later. Visit Social Security’s Retirement Age Calculator to learn more.

If you were born in 1945, you’ll turn 70 this year. If you haven’t already applied to start Social Security, you should do it now. Waiting any longer won’t earn you any additional benefits.

If you were born before July 1, 1944, you are now age 70½ or older. This birthday isn’t exactly good news, because it means you have to start taking Required Minimum Distributions from your retirement plans, paying taxes on the money whether you need it or not.

On the bright side, if you have to take an RMD, it means you reached your seventies and you still have money in the bank. You worked hard, made the right choices and now you enjoy the rewards.

As you reach these or other milestones in your personal and professional life, Republic Wealth is always available to help. We hope you have many wonderful birthdays ahead.


IMPORTANT DISCLOSURE INFORMATION: Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by Republic Wealth Advisors), or any non-investment related content, made reference to directly or indirectly in this blog will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this blog serves as the receipt of, or as a substitute for, personalized investment advice from Republic Wealth Advisors. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. Republic Wealth Advisors is neither a law firm nor a certified public accounting firm and no portion of this blog content should be construed as legal or accounting advice. If you are a Republic Wealth Advisors client, please remember to contact Republic Wealth Advisors, in writing, if there are any changes in your personal/financial situation or investment objectives for the purpose of reviewing/evaluating/revising our previous recommendations and/or services. A copy of the Republic Wealth Advisors’ current written disclosure statement discussing our advisory services and fees is available upon request.

Related Posts